The Company has operating leases related to office space and manufacturing facilities. The Company has finance leases related to vehicles, tractors, and trailers. The Company’s office space leases have a remaining lease term of three to 87 months as of December 31, 2025. The Company’s finance leases have remaining lease terms ranging from one to 84 months as of December 31, 2025. Certain leases include one or more options to renew, with renewal terms that can extend the lease term from one to seven years. The exercise of lease renewal options is typically at our discretion. The measurement of the lease term includes options to extend or renew the lease when it is reasonably certain that we will exercise those options.

Lease terms are negotiated on an individual basis and may contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes.

Leases are recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Company.

The consolidated balance sheets consist of the following amounts relating to operating and finance leases (in thousands):


	As of December 31,
	2025		2024
Operating right-of-use assets
Real property	$	17,556	$	19,480
	$	17,556	$	19,480
Operating lease liabilities
Current	$	8,004	$	6,809
Non-current		9,783		12,739
	$	17,787	$	19,548


	As of December 31,
	2025		2024
Finance right-of-use assets
Vehicles	$	25,861	$	21,871
	$	25,861	$	21,871
Finance lease liabilities
Current	$	12,895	$	7,837
Non-current		10,862		13,389
	$	23,757	$	21,226

Additions to operating right-of-use assets during 2025 and 2024 were approximately $5.3 million and $5.5 million, respectively. Disposals to operating right-of-use assets during 2025 and 2024 were approximately $4.2 million and $0.6 million, respectively.

Additions to finance right-of-use assets during 2025 and 2024 were approximately $17.9 million and $8.4 million, respectively. Disposals to finance right-of-use assets during 2025 and 2024 were approximately $5.1 million and $0.1 million, respectively.

The weighted average lessee’s incremental borrowing rate applied to the operating and finance lease liabilities on December 31, 2025 was 6.6% and 6.9%, respectively. The weighted average lessee's incremental borrowing rate applied to the operating and finance lease liabilities on December 31, 2024 was 6.7% and 8.0%, respectively. The weighted average remaining lease term for operating and finance lease on December 31, 2025 was 2.80 years and 2.68 years, respectively. The weighted average remaining lease term for operating and finance lease on December 31, 2024 was 3.77 years and 2.10 years, respectively.

The consolidated statements of operations consist of the following amounts relating to leases (in thousands):


	Year Ended December 31,
	2025		2024		2023
Amortization of real property operating right-of-use assets
(included in general and administrative expenses)	$	9,827	$	4,326	$	508
Interest expense (recovery) of vehicles finance right-of-use assets
(included in interest expense)	$	1,820	$	909	$	530
Depreciation of vehicles finance right-of-use assets
(included in depreciation and amortization)	$	12,414	$	6,113	$	995

Variable lease expense	$	—	$	—	$	—
Short-term lease expense	$	1,628	$	331	$	—

The below table shows the total cash outflows for leases for the periods presented (in thousands):


	Year Ended December 31,
	2025		2024		2023
Operating cash flows from operating leases	$	9,913	$	4,246	$	508
Financing cash flows from finance leases		14,965		7,503		1,525
Total cash outflows for leases	$	24,878	$	11,749	$	2,033

The table below reconciles the undiscounted future minimum operating and finance lease payments to the operating and finance lease liabilities recorded on the balance sheet as of December 31, 2025 (in thousands):


	Operating Lease			Finance Lease
2026	$	8,878		$	13,993
2027		5,256			8,306
2028		2,607			2,452
2029		1,452			380
2030		895			157
Thereafter		645			31
Total future minimum lease payments		19,733			25,319
Less: Amount of lease payments representing interest		(1,946	)		(1,562	)
Present values of future minimum lease payments	$	17,787		$	23,757

Rental agreements are for the rental of our compressor units to customers. Rental revenue for the years ended December 31, 2025, 2024 and 2023 were approximately $418.0 million, $276.7 million, and $168.8 million, respectively. Revenue related to these rental agreements is reflected as rental revenue in the consolidated statements of operations.

Scheduled future minimum lease payments to be received by the Company as of December 31, 2025 for each of the next five years is as follows (in thousands):


	Amount
2026	$	161,481
2027		68,650
2028		13,328
2029		1,193
2030		—
Thereafter		—
Total	$	244,652