Leases

12 Months Ended

Jun. 30, 2024

The following table summarizes the ROU assets and lease liabilities recorded on the Company’s consolidated balance sheets as of June 30, 2024 and 2023:


	As of
	June 30, 2024		June 30, 2023
ROU assets	$	106,468	$	84,912
Lease liabilities:
Operating leases, current	18,548		10,127
Operating leases, non-current	128,022		110,259
Total lease liabilities	$	146,570	$	120,386

The following table summarizes the activity recorded within the Company’s consolidated statements of operations for Fiscal Years 2024, 2023 and 2022:


	Line Item in the Company’s Consolidated Statements of Operations	Years Ended June 30,
		2024		2023		2022
Operating lease cost	Direct operating expenses	$	3,984	$	1,676	$	1,287
Operating lease cost	Selling, general and administrative expenses	14,549		15,925		16,977


Variable lease cost	Direct operating expenses	1,740		—		—
Variable lease cost	Selling, general and administrative expenses	28		1		20
Total lease cost		$	20,301	$	17,602	$	18,284

The Company excluded its ground lease with a subsidiary of Venetian Venue Propco, LLC (“The Venetian”) associated with Sphere in Las Vegas from its ROU assets and lease liabilities balances as the ground lease will not have any fixed rent. If certain return objectives are achieved, The Venetian will receive 25% of the after-tax cash flow in excess of such objectives in the form of variable rent. The Venetian paid the Company $75,000 to help fund the construction costs, including the cost of a pedestrian bridge that links Sphere to The Venetian Expo. The 50-year fixed term commenced on July 14, 2023.

Supplemental cash flow information related to operating leases is as follows:


	Years Ended June 30,
	2024		2023		2022
Cash paid for amounts included in the measurement of operating lease liabilities	$	19,000	$	12,332	$	14,400
Lease assets obtained in exchange for new lease obligations	33,900		6,435		43,834

For Fiscal Years 2024 and 2022, the Company received $5,833 and $17,697, respectively, of tenant incentives from a landlord for capital expenditures on behalf of the Company. There were no tenant incentives received in Fiscal Year 2023.

Maturities of operating lease liabilities are as follows:


	As of June 30, 2024
Fiscal year ending June 30, 2025	$	19,555
Fiscal year ending June 30, 2026	19,438
Fiscal year ending June 30, 2027	15,866
Fiscal year ending June 30, 2028	16,020
Fiscal year ending June 30, 2029	16,574
Thereafter	118,613
Total lease payments	206,066
Less imputed interest	59,496
Total lease liabilities	$	146,570

The weighted average remaining lease term and weighted average discount rate for our operating leases as of June 30, 2024 and 2023 were as follows:


	As of
	June 30, 2024		June 30, 2023
Weighted average remaining lease term (in years)	11.4		12.1
Weighted average discount rate	5.89	%	5.38	%

As of June 30, 2024, the Company’s existing operating leases, which are recorded on the accompanying financial statements, have remaining lease terms ranging from 0.2 years to 17.6 years.

Lessor Arrangements

The Company has sublease arrangements for office and storage spaces where the operating lease revenue is recognized on a straight-line basis over the lease term. The following table summarizes the Company’s sublease revenues for Fiscal Years 2024, 2023 and 2022:


	Years Ended June 30,
	2024		2023		2022
Sublease arrangements	$	3,028	$	2,610	$	1,900

The maturities of operating lease cash flows to be received on an undiscounted basis for non-cancelable subleases are as follows:




	As of June 30, 2024
Fiscal year ending June 30, 2025	$	2,813
Fiscal year ending June 30, 2026	2,084




Total future minimum receipts	$	4,897