LEASES

6 Months Ended

Jun. 28, 2024

The components of lease expense are as follows:


	Three Months Ended				Six Months Ended
(in thousands)	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Operating lease cost	$	1,759	$	1,761	$	3,488	$	3,525
Variable lease cost	416		425		807		850
Total lease cost	$	2,175	$	2,186	$	4,295	$	4,375

Supplemental information related to leases are as follows:


	Three Months Ended				Six Months Ended
(in thousands)	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Cash paid for operating lease liabilities	$	1,773	$	1,778	$	3,568	$	3,606

In the second quarter of fiscal 2024, we reviewed the right-of-use lease assets and other fixed assets associated with our San Jose headquarters and our facilities in the United Kingdom (“UK”) for potential impairment due to an intended change in the use of these spaces. Following our analysis, we recorded total lease-related impairment and other charges of $9.0 million which primarily consisted of right-of-use asset impairment charges of $2.9 million, related leasehold improvement impairment charges of $4.2 million, and fair value of other unrecoverable facility costs of $1.9 million.

For asset groups where impairment was triggered, the Company utilized an income approach to value the asset groups by developing discounted cash flow models. The significant assumptions used in the discounted cash flow models for each of the asset groups included projected sublease income over the remaining lease terms, expected downtime prior to the commencement of future subleases, expected lease incentives offered to future tenants, and discount rates that reflected the level of risk associated with these future cash flows.