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Leases | 12 Months Ended
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Dec. 31, 2024
Leases [Abstract] |
Leases | LEASES: Quanta primarily leases land, buildings, vehicles, construction equipment and office equipment. As of December 31, 2024, the majority of Quanta’s leases had remaining lease terms of less than 13 years. Certain leases include options to extend their terms in increments of up to five years and/or options to terminate. The components of lease costs in the accompanying consolidated statements of operations are as follows (in thousands):
|  |  | Year Ended December 31,
Lease and lease financing cost | Classification |  | 2024 |  | 2023 |  | 2022
Finance lease cost: |  |  |  |  |  |  |
Amortization of lease assets | Depreciation (1) |  | $ | 11,462 |  |  | $ | 4,944 |  |  | $ | 1,540 |
Interest on lease liabilities | Interest and other financing expenses |  | 2,798 |  |  | 1,463 |  |  | 108 |
Lease financing transactions:(2) |  |  |  |  |  |  |
Depreciation | Depreciation (1) |  | 10,396 |  |  | 7,698 |  |  | 5,303 |
Interest | Interest and other financing expenses |  | 17,600 |  |  | 12,992 |  |  | 8,405 |
Operating lease cost | Cost of services and Selling, general and administrative expenses |  | 108,879 |  |  | 93,133 |  |  | 93,539 |
Short-term and variable lease cost (3) | Cost of services and Selling, general and administrative expenses |  | 1,245,011 |  |  | 1,106,454 |  |  | 953,721 |
Total lease and lease financing cost |  |  | $ | 1,396,146 |  |  | $ | 1,226,684 |  |  | $ | 1,062,616 |
(1) Depreciation is included within “Cost of services” and “Selling, general and administrative expenses” in the accompanying consolidated statements of operations. (2) Certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. When these purchase options are exercised by a third-party lessor on behalf of Quanta, the transaction is deemed to be a financing transaction for accounting purposes, which results in the recognition of an asset equal to the purchase price and a corresponding liability. (3) Short-term lease cost includes both leases and rentals with initial terms of one year or less. Variable lease cost is insignificant. Quanta has entered into arrangements with certain related parties to lease real and personal property and facilities. Typically, the parties are employees of Quanta who are also the former owners of businesses acquired by Quanta, and the real property and facilities continue to be utilized by Quanta subsequent to the acquisitions. Quanta utilizes third-party market valuations to evaluate rental rates for these properties and facilities, and the lease agreements generally have remaining lease terms of up to ten years, subject to renewal options. Related party lease expense was $18.7 million, $16.5 million and $14.7 million for the years ended December 31, 2024, 2023 and 2022. The components of leases in the accompanying consolidated balance sheets were as follows (in thousands):
|  |  | December 31, |  |
Lease type | Classification |  | 2024 |  | 2023 |  |
Assets: |  |  |  |  |  |  |
Operating lease right-of-use assets | Operating lease right-of-use assets |  | $ | 299,895 |  |  | $ | 249,443 |  |  |
Finance lease assets | Property and equipment, net of accumulated depreciation |  | 43,018 |  |  | 35,770 |  |  |
Lease financing transaction assets | Property and equipment, net of accumulated depreciation |  | 155,548 |  |  | 102,955 |  |  |
Total lease and lease financing assets |  |  | $ | 498,461 |  |  | $ | 388,168 |  |  |
Liabilities: |  |  |  |  |  |  |
Current: |  |  |  |  |  |  |
Operating | Current portion of operating lease liabilities |  | $ | 94,162 |  |  | $ | 77,995 |  |  |
Finance | Current maturities of long-term debt and short-term debt |  | 11,641 |  |  | 7,767 |  |  |
Lease financing transaction liabilities | Current maturities of long-term debt and short-term debt |  | 11,307 |  |  | 7,345 |  |  |
Non-current: |  |  |  |  |  |  |
Operating | Operating lease liabilities, net of current portion |  | 222,359 |  |  | 186,996 |  |  |
Finance | Long-term debt, net of current maturities |  | 36,352 |  |  | 31,810 |  |  |
Lease financing transaction liabilities | Long-term debt, net of current maturities |  | 144,242 |  |  | 95,610 |  |  |
Total lease and lease financing liabilities |  |  | $ | 520,063 |  |  | $ | 407,523 |  |  |
Future minimum lease payments for operating leases and finance leases were as follows (in thousands):
|  | As of December 31, 2024
|  | Operating Leases |  | Finance Leases |  | Total
2025 |  | $ | 107,468 |  |  | $ | 13,225 |  |  | $ | 120,693 |
2026 |  | 86,518 |  |  | 12,244 |  |  | 98,762 |
2027 |  | 62,115 |  |  | 10,847 |  |  | 72,962 |
2028 |  | 40,801 |  |  | 8,707 |  |  | 49,508 |
2029 |  | 18,475 |  |  | 7,291 |  |  | 25,766 |
Thereafter |  | 39,456 |  |  | 2,737 |  |  | 42,193 |
Total future minimum payments related to operating leases and finance leases |  | 354,833 |  |  | 55,051 |  |  | 409,884 |
Less imputed interest |  | (38,312) |  |  | (7,058) |  |  | (45,370) |
Total |  | $ | 316,521 |  |  | $ | 47,993 |  |  | $ | 364,514 |
Future minimum lease payments for short-term leases were $27.3 million as of December 31, 2024. Additionally, as described above, certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. The future payments related to these lease financing transactions totaled $120.5 million and comprise principal and interest payments. The principal payments related to lease financing transactions required to be made during the next five years are included in the debt maturity table in Note 10. The weighted average remaining lease terms (other than for short-term leases) and discount rates were as follows:
|  | As of December 31,
|  | 2024 |  | 2023
Weighted average remaining lease term (in years): |  |  |  |
Operating leases |  | 4.48 |  | 4.34
Finance leases |  | 4.35 |  | 5.69
Weighted average discount rate: |  |  |  |
Operating leases |  | 5.1 | % |  | 4.3 | %
Finance leases |  | 6.1 | % |  | 6.3 | %
Quanta has also guaranteed the residual value under certain of its equipment operating leases and real estate finance leases, agreeing to pay any difference between the residual value and the fair market value of the underlying asset at the date of lease termination. Historically, the fair value of the assets at the time of lease termination generally has approximated or exceeded the residual value guarantees, and therefore such guarantees are not expected to result in significant payments.
Leases | LEASES: Quanta primarily leases land, buildings, vehicles, construction equipment and office equipment. As of December 31, 2024, the majority of Quanta’s leases had remaining lease terms of less than 13 years. Certain leases include options to extend their terms in increments of up to five years and/or options to terminate. The components of lease costs in the accompanying consolidated statements of operations are as follows (in thousands):
|  |  | Year Ended December 31,
Lease and lease financing cost | Classification |  | 2024 |  | 2023 |  | 2022
Finance lease cost: |  |  |  |  |  |  |
Amortization of lease assets | Depreciation (1) |  | $ | 11,462 |  |  | $ | 4,944 |  |  | $ | 1,540 |
Interest on lease liabilities | Interest and other financing expenses |  | 2,798 |  |  | 1,463 |  |  | 108 |
Lease financing transactions:(2) |  |  |  |  |  |  |
Depreciation | Depreciation (1) |  | 10,396 |  |  | 7,698 |  |  | 5,303 |
Interest | Interest and other financing expenses |  | 17,600 |  |  | 12,992 |  |  | 8,405 |
Operating lease cost | Cost of services and Selling, general and administrative expenses |  | 108,879 |  |  | 93,133 |  |  | 93,539 |
Short-term and variable lease cost (3) | Cost of services and Selling, general and administrative expenses |  | 1,245,011 |  |  | 1,106,454 |  |  | 953,721 |
Total lease and lease financing cost |  |  | $ | 1,396,146 |  |  | $ | 1,226,684 |  |  | $ | 1,062,616 |
(1) Depreciation is included within “Cost of services” and “Selling, general and administrative expenses” in the accompanying consolidated statements of operations. (2) Certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. When these purchase options are exercised by a third-party lessor on behalf of Quanta, the transaction is deemed to be a financing transaction for accounting purposes, which results in the recognition of an asset equal to the purchase price and a corresponding liability. (3) Short-term lease cost includes both leases and rentals with initial terms of one year or less. Variable lease cost is insignificant. Quanta has entered into arrangements with certain related parties to lease real and personal property and facilities. Typically, the parties are employees of Quanta who are also the former owners of businesses acquired by Quanta, and the real property and facilities continue to be utilized by Quanta subsequent to the acquisitions. Quanta utilizes third-party market valuations to evaluate rental rates for these properties and facilities, and the lease agreements generally have remaining lease terms of up to ten years, subject to renewal options. Related party lease expense was $18.7 million, $16.5 million and $14.7 million for the years ended December 31, 2024, 2023 and 2022. The components of leases in the accompanying consolidated balance sheets were as follows (in thousands):
|  |  | December 31, |  |
Lease type | Classification |  | 2024 |  | 2023 |  |
Assets: |  |  |  |  |  |  |
Operating lease right-of-use assets | Operating lease right-of-use assets |  | $ | 299,895 |  |  | $ | 249,443 |  |  |
Finance lease assets | Property and equipment, net of accumulated depreciation |  | 43,018 |  |  | 35,770 |  |  |
Lease financing transaction assets | Property and equipment, net of accumulated depreciation |  | 155,548 |  |  | 102,955 |  |  |
Total lease and lease financing assets |  |  | $ | 498,461 |  |  | $ | 388,168 |  |  |
Liabilities: |  |  |  |  |  |  |
Current: |  |  |  |  |  |  |
Operating | Current portion of operating lease liabilities |  | $ | 94,162 |  |  | $ | 77,995 |  |  |
Finance | Current maturities of long-term debt and short-term debt |  | 11,641 |  |  | 7,767 |  |  |
Lease financing transaction liabilities | Current maturities of long-term debt and short-term debt |  | 11,307 |  |  | 7,345 |  |  |
Non-current: |  |  |  |  |  |  |
Operating | Operating lease liabilities, net of current portion |  | 222,359 |  |  | 186,996 |  |  |
Finance | Long-term debt, net of current maturities |  | 36,352 |  |  | 31,810 |  |  |
Lease financing transaction liabilities | Long-term debt, net of current maturities |  | 144,242 |  |  | 95,610 |  |  |
Total lease and lease financing liabilities |  |  | $ | 520,063 |  |  | $ | 407,523 |  |  |
Future minimum lease payments for operating leases and finance leases were as follows (in thousands):
|  | As of December 31, 2024
|  | Operating Leases |  | Finance Leases |  | Total
2025 |  | $ | 107,468 |  |  | $ | 13,225 |  |  | $ | 120,693 |
2026 |  | 86,518 |  |  | 12,244 |  |  | 98,762 |
2027 |  | 62,115 |  |  | 10,847 |  |  | 72,962 |
2028 |  | 40,801 |  |  | 8,707 |  |  | 49,508 |
2029 |  | 18,475 |  |  | 7,291 |  |  | 25,766 |
Thereafter |  | 39,456 |  |  | 2,737 |  |  | 42,193 |
Total future minimum payments related to operating leases and finance leases |  | 354,833 |  |  | 55,051 |  |  | 409,884 |
Less imputed interest |  | (38,312) |  |  | (7,058) |  |  | (45,370) |
Total |  | $ | 316,521 |  |  | $ | 47,993 |  |  | $ | 364,514 |
Future minimum lease payments for short-term leases were $27.3 million as of December 31, 2024. Additionally, as described above, certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. The future payments related to these lease financing transactions totaled $120.5 million and comprise principal and interest payments. The principal payments related to lease financing transactions required to be made during the next five years are included in the debt maturity table in Note 10. The weighted average remaining lease terms (other than for short-term leases) and discount rates were as follows:
|  | As of December 31,
|  | 2024 |  | 2023
Weighted average remaining lease term (in years): |  |  |  |
Operating leases |  | 4.48 |  | 4.34
Finance leases |  | 4.35 |  | 5.69
Weighted average discount rate: |  |  |  |
Operating leases |  | 5.1 | % |  | 4.3 | %
Finance leases |  | 6.1 | % |  | 6.3 | %
Quanta has also guaranteed the residual value under certain of its equipment operating leases and real estate finance leases, agreeing to pay any difference between the residual value and the fair market value of the underlying asset at the date of lease termination. Historically, the fair value of the assets at the time of lease termination generally has approximated or exceeded the residual value guarantees, and therefore such guarantees are not expected to result in significant payments.

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- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/842-20/tableOfContent + Details
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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 842 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/842-20/tableOfContent + Details
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