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LEASES | 12 Months Ended
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Dec. 31, 2022
Leases [Abstract] |
LEASES | LEASESOur leases consist primarily of operating real estate leases for office space and data centers in the markets in which we conduct business. We also have operating and finance leases for computer and other equipment. Many of our leases include escalating rental payments and incentives, as well as termination and renewal options. Certain of our lease agreements provide that we pay the cost of property taxes, insurance and maintenance. As of December 31, 2022 and 2021, right-of-use assets and lease liabilities consisted of the following:
|  | Balance Sheet Location(2) |  | December 31, 2022 |  | December 31, 2021
|  |  |  | (in thousands)
Assets: |  |  |  |  |  |
Operating lease right-of-use assets: |  |  |  |  |  |
Real estate |  | Other noncurrent assets |  | $ | 336,993 |  |  | $ | 404,453 |
Computer equipment |  | Other noncurrent assets |  | 22,763 |  |  | 88,431 |
Other |  | Other noncurrent assets |  | 727 |  |  | 1,198 |
Total operating lease right-of-use-assets |  |  |  | $ | 360,483 |  |  | $ | 494,082 |
Finance lease right-of-use assets: |  |  |  |  |  |
Computer equipment |  | Property and equipment, net |  | $ | 7,280 |  |  | $ | 24,720 |
Other equipment |  | Property and equipment, net |  | 53,410 |  |  | 55,953 |
Other |  | Property and equipment, net |  | 6,090 |  |  | 4,608 |
|  |  |  | 66,780 |  |  | 85,281 |
Less accumulated depreciation: |  |  |  |  |  |
Computer equipment |  | Property and equipment, net |  | (3,331) |  |  | (11,107) |
Other equipment |  | Property and equipment, net |  | (29,052) |  |  | (19,914) |
Other |  | Property and equipment, net |  | (2,884) |  |  | (344) |
Total accumulated depreciation |  |  |  | (35,267) |  |  | (31,365) |
Total finance lease right-of-use assets |  |  |  | 31,513 |  |  | 53,916 |
Total right-of-use assets(1) |  |  |  | $ | 391,996 |  |  | $ | 547,998 |
Liabilities: |  |  |  |  |  |
Operating lease liabilities (current) |  | Accounts payable and accrued liabilities |  | $ | 80,208 |  |  | $ | 103,554 |
Operating lease liabilities (noncurrent) |  | Other noncurrent liabilities |  | 439,580 |  |  | 550,726 |
Finance lease liabilities (current) |  | Current portion of long-term debt |  | 12,883 |  |  | 19,905 |
Finance lease liabilities (noncurrent) |  | Long-term debt |  | 19,552 |  |  | 44,516 |
Total lease liabilities |  |  |  | $ | 552,223 |  |  | $ | 718,701 |
(1) As of December 31, 2022 and 2021, approximately 73% and 75% of our right-of-use assets were located in the United States. (2) As of December 31, 2022, operating lease assets and liabilities of approximately $4.9 million and $5.0 million have been classified as assets held for sale in connection with the presentation of the consumer and gaming businesses as held for sale. See “Note 3—Business Dispositions” for further discussion. The weighted-average remaining lease term for operating and finance leases at December 31, 2022 was 8.8 years and 2.7 years, respectively. The weighted-average remaining lease term for operating and finance leases at December 31, 2021 was 8.4 years and 3.2 years, respectively. As of December 31, 2022, the weighted-average discount rate used in the measurement of operating and finance lease liabilities was 3.3% and 3.4%, respectively. As of December 31, 2021, the weighted-average discount rate used in the measurement of operating and finance lease liabilities was 3.2% and 3.2%, respectively. As of December 31, 2022, maturities of lease liabilities were as follows:
|  | Operating Leases |  | Finance Leases
|  | (in thousands)
Year ending December 31, |  |  |  |
2023 |  | $ | 95,127 |  |  | $ | 13,729 |
2024 |  | 88,931 |  |  | 11,522 |
2025 |  | 73,424 |  |  | 6,269 |
2026 |  | 63,463 |  |  | 1,820 |
2027 |  | 47,605 |  |  | 473 |
2028 and thereafter |  | 243,059 |  |  | — |
Total lease payments(1) |  | 611,609 |  |  | 33,813 |
Imputed interest |  | (91,821) |  |  | (1,378) |
Total lease liabilities |  | $ | 519,788 |  |  | $ | 32,435 |
(1) Total operating lease payments do not include approximately $4.3 million for operating leases that had not yet commenced at December 31, 2022. Operating lease costs in our consolidated statement of income for the year ended December 31, 2022 were $137.8 million, including $105.7 million in selling, general and administrative expenses and $32.1 million in cost of services. Total lease costs for the year ended December 31, 2022 include variable lease costs of $21.0 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2022 were $18.1 million, including $16.7 million of amortization on right-of use assets and $1.4 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2022. Operating lease costs in our consolidated statement of income for the year ended December 31, 2021 were $195.6 million, including $157.4 million in selling, general and administrative expenses and $38.2 million in cost of services. Total lease costs for the year ended December 31, 2021 include variable lease costs of $18.1 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2021 wer e $20.5 million, including $18.4 million of amortization on right-of use assets and $2.2 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2021. Operating lease costs in our consolidated statement of income for the year ended December 31, 2020 were $147.0 million, including $108.4 million in selling, general and administrative expenses and $38.6 million in cost of services. Total lease costs for the year ended December 31, 2020 include variable lease costs of $17.9 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. F inance lease costs for the year ended December 31, 2020 were $16.3 million, including $14.6 million of amortization on right-of use assets and $1.6 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2020. Opportunities were identified during the years ended December 31, 2022 and 2021 to reduce our facility footprint in certain markets around the world. In conjunction with the actions taken to exit certain leased facilities, we assessed the respective asset groups for impairment by comparing the carrying amount of the assets associated with the leased facilities to the discounted cash flows from estimated sublease payments. As a result, we recognized charges of $22.9 million and $42.1 million in selling, general and administrative expenses in our consolidated statement of income for the years ended December 31, 2022 and 2021, respectively. Cash paid for amounts included in the measurement of operating lease liabilities for the years ended December 31, 2022, 2021 and 2020 w as $120.7 million, $123.6 million and $117.7 million, respectively, which are included as a component of cash provided by operating activities in the consolidated statement of cash flows. Operating lease liabilities arising from obtaining new or modified right-of-use assets, net of reductions resulting from certain lease modifications, were $25.8 million, $200.1 million and $158.6 million for the years ended December 31, 2022, 2021 and 2020, respectively. Cash paid for amounts included in the measurement of finance lease liabilities that is included as a component of cash used in financing activities in the consolidated statement of cash flows was $21.2 million, $22.6 million and $11.2 million for the years ended December 31, 2022, 2021 and 2020, respectively. Finance lease liabilities arising from obtaining new or modified right-of-use assets, net of reductions resulting from certain lease modifications, were $8.2 million, $7.9 million and $51.3 million for the years ended December 31, 2022, 2021 and 2020, respectively. In connection with acquisitions completed during the year ended December 31, 2021, we acquired right-of-use assets and assumed lease liabilities for operating and finance leases of $8.8 million and $5.8 million, respectively. During the year ended December 31, 2022, we entered into a new agreement to acquire hardware, software and related services, including the purchase of certain assets previously leased. The reduction in operating and finance lease liabilities arising from the termination of the related right-of-use assets was $44.2 million and $9.7 million, respectively.
LEASES | LEASESOur leases consist primarily of operating real estate leases for office space and data centers in the markets in which we conduct business. We also have operating and finance leases for computer and other equipment. Many of our leases include escalating rental payments and incentives, as well as termination and renewal options. Certain of our lease agreements provide that we pay the cost of property taxes, insurance and maintenance. As of December 31, 2022 and 2021, right-of-use assets and lease liabilities consisted of the following:
|  | Balance Sheet Location(2) |  | December 31, 2022 |  | December 31, 2021
|  |  |  | (in thousands)
Assets: |  |  |  |  |  |
Operating lease right-of-use assets: |  |  |  |  |  |
Real estate |  | Other noncurrent assets |  | $ | 336,993 |  |  | $ | 404,453 |
Computer equipment |  | Other noncurrent assets |  | 22,763 |  |  | 88,431 |
Other |  | Other noncurrent assets |  | 727 |  |  | 1,198 |
Total operating lease right-of-use-assets |  |  |  | $ | 360,483 |  |  | $ | 494,082 |
Finance lease right-of-use assets: |  |  |  |  |  |
Computer equipment |  | Property and equipment, net |  | $ | 7,280 |  |  | $ | 24,720 |
Other equipment |  | Property and equipment, net |  | 53,410 |  |  | 55,953 |
Other |  | Property and equipment, net |  | 6,090 |  |  | 4,608 |
|  |  |  | 66,780 |  |  | 85,281 |
Less accumulated depreciation: |  |  |  |  |  |
Computer equipment |  | Property and equipment, net |  | (3,331) |  |  | (11,107) |
Other equipment |  | Property and equipment, net |  | (29,052) |  |  | (19,914) |
Other |  | Property and equipment, net |  | (2,884) |  |  | (344) |
Total accumulated depreciation |  |  |  | (35,267) |  |  | (31,365) |
Total finance lease right-of-use assets |  |  |  | 31,513 |  |  | 53,916 |
Total right-of-use assets(1) |  |  |  | $ | 391,996 |  |  | $ | 547,998 |
Liabilities: |  |  |  |  |  |
Operating lease liabilities (current) |  | Accounts payable and accrued liabilities |  | $ | 80,208 |  |  | $ | 103,554 |
Operating lease liabilities (noncurrent) |  | Other noncurrent liabilities |  | 439,580 |  |  | 550,726 |
Finance lease liabilities (current) |  | Current portion of long-term debt |  | 12,883 |  |  | 19,905 |
Finance lease liabilities (noncurrent) |  | Long-term debt |  | 19,552 |  |  | 44,516 |
Total lease liabilities |  |  |  | $ | 552,223 |  |  | $ | 718,701 |
(1) As of December 31, 2022 and 2021, approximately 73% and 75% of our right-of-use assets were located in the United States. (2) As of December 31, 2022, operating lease assets and liabilities of approximately $4.9 million and $5.0 million have been classified as assets held for sale in connection with the presentation of the consumer and gaming businesses as held for sale. See “Note 3—Business Dispositions” for further discussion. The weighted-average remaining lease term for operating and finance leases at December 31, 2022 was 8.8 years and 2.7 years, respectively. The weighted-average remaining lease term for operating and finance leases at December 31, 2021 was 8.4 years and 3.2 years, respectively. As of December 31, 2022, the weighted-average discount rate used in the measurement of operating and finance lease liabilities was 3.3% and 3.4%, respectively. As of December 31, 2021, the weighted-average discount rate used in the measurement of operating and finance lease liabilities was 3.2% and 3.2%, respectively. As of December 31, 2022, maturities of lease liabilities were as follows:
|  | Operating Leases |  | Finance Leases
|  | (in thousands)
Year ending December 31, |  |  |  |
2023 |  | $ | 95,127 |  |  | $ | 13,729 |
2024 |  | 88,931 |  |  | 11,522 |
2025 |  | 73,424 |  |  | 6,269 |
2026 |  | 63,463 |  |  | 1,820 |
2027 |  | 47,605 |  |  | 473 |
2028 and thereafter |  | 243,059 |  |  | — |
Total lease payments(1) |  | 611,609 |  |  | 33,813 |
Imputed interest |  | (91,821) |  |  | (1,378) |
Total lease liabilities |  | $ | 519,788 |  |  | $ | 32,435 |
(1) Total operating lease payments do not include approximately $4.3 million for operating leases that had not yet commenced at December 31, 2022. Operating lease costs in our consolidated statement of income for the year ended December 31, 2022 were $137.8 million, including $105.7 million in selling, general and administrative expenses and $32.1 million in cost of services. Total lease costs for the year ended December 31, 2022 include variable lease costs of $21.0 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2022 were $18.1 million, including $16.7 million of amortization on right-of use assets and $1.4 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2022. Operating lease costs in our consolidated statement of income for the year ended December 31, 2021 were $195.6 million, including $157.4 million in selling, general and administrative expenses and $38.2 million in cost of services. Total lease costs for the year ended December 31, 2021 include variable lease costs of $18.1 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. Finance lease costs for the year ended December 31, 2021 wer e $20.5 million, including $18.4 million of amortization on right-of use assets and $2.2 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2021. Operating lease costs in our consolidated statement of income for the year ended December 31, 2020 were $147.0 million, including $108.4 million in selling, general and administrative expenses and $38.6 million in cost of services. Total lease costs for the year ended December 31, 2020 include variable lease costs of $17.9 million, which are primarily comprised of the cost of property taxes, insurance and maintenance. F inance lease costs for the year ended December 31, 2020 were $16.3 million, including $14.6 million of amortization on right-of use assets and $1.6 million of interest on lease liabilities. Lease costs for leases with a term of less than 12 months were not material for the year ended December 31, 2020. Opportunities were identified during the years ended December 31, 2022 and 2021 to reduce our facility footprint in certain markets around the world. In conjunction with the actions taken to exit certain leased facilities, we assessed the respective asset groups for impairment by comparing the carrying amount of the assets associated with the leased facilities to the discounted cash flows from estimated sublease payments. As a result, we recognized charges of $22.9 million and $42.1 million in selling, general and administrative expenses in our consolidated statement of income for the years ended December 31, 2022 and 2021, respectively. Cash paid for amounts included in the measurement of operating lease liabilities for the years ended December 31, 2022, 2021 and 2020 w as $120.7 million, $123.6 million and $117.7 million, respectively, which are included as a component of cash provided by operating activities in the consolidated statement of cash flows. Operating lease liabilities arising from obtaining new or modified right-of-use assets, net of reductions resulting from certain lease modifications, were $25.8 million, $200.1 million and $158.6 million for the years ended December 31, 2022, 2021 and 2020, respectively. Cash paid for amounts included in the measurement of finance lease liabilities that is included as a component of cash used in financing activities in the consolidated statement of cash flows was $21.2 million, $22.6 million and $11.2 million for the years ended December 31, 2022, 2021 and 2020, respectively. Finance lease liabilities arising from obtaining new or modified right-of-use assets, net of reductions resulting from certain lease modifications, were $8.2 million, $7.9 million and $51.3 million for the years ended December 31, 2022, 2021 and 2020, respectively. In connection with acquisitions completed during the year ended December 31, 2021, we acquired right-of-use assets and assumed lease liabilities for operating and finance leases of $8.8 million and $5.8 million, respectively. During the year ended December 31, 2022, we entered into a new agreement to acquire hardware, software and related services, including the purchase of certain assets previously leased. The reduction in operating and finance lease liabilities arising from the termination of the related right-of-use assets was $44.2 million and $9.7 million, respectively.

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