LEASES

12 Months Ended

Dec. 31, 2025

NOTE 4. LEASES

The components of lease expense are as follows:


		Year Ended December 31,
(in thousands)	2025		2024
Operating lease cost	$	6,812	$	6,943
Variable lease cost		1,228		1,537
Total lease cost	$	8,040	$	8,480

Supplemental cash flow information related to leases are as follows:


		Year Ended December 31,
(in thousands)	2025		2024
Cash paid for operating lease liabilities	$	6,166	$	7,163
Right-of-use assets obtained in exchange for operating lease obligations	$	5,028	$	489

During the year ended December 31, 2025, we recorded lease-related impairment and other charges of $1.6 million, which consisted of $0.4 million in right-of-use asset impairments, $0.3 million in leasehold improvement impairments, and $0.9 million related to the fair value of other unrecoverable facility costs.

During the year ended December 31, 2024, we recorded lease-related impairment and other charges of $10.9 million, which consisted of $3.9 million in right-of-use asset impairments, $4.3 million in leasehold improvement impairments, and $2.7 million related to the fair value of other unrecoverable facility costs.

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 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.

Other information related to leases are as follows:


	Year Ended December 31,
	2025		2024
Operating leases
Weighted-average remaining lease term (years)		4.3		5.0
Weighted-average discount rate		6.6%		6.5%

Future minimum lease payments under non-cancelable operating leases as of December 31, 2025 are as follows (in thousands):


Years ending December 31,
2026	$	6,665
2027		5,632
2028		4,567
2029		3,985
2030		1,851
Thereafter		1,267
Total future minimum lease payments	$	23,967
Less: imputed interest		(2,870)
Total lease liability balance	$	21,097