Leases

9 Months Ended

Sep. 30, 2023

At September 30, 2023 and December 31, 2022, the Company’s lease assets and lease liabilities, primarily for its studios and corporate offices, were as follows:


	September 30, 2023		December 31, 2022
Assets:
Operating leases	$	55,414	$	75,696
Finance leases		10		54
Total lease assets	$	55,424	$	75,750

Liabilities:
Current
Operating leases	$	9,804	$	17,955
Finance leases		9		31
Noncurrent
Operating leases		56,643		68,099
Finance leases		0		7
Total lease liabilities	$	66,456	$	86,092

For the three and nine months ended September 30, 2023 and October 1, 2022, the components of the Company’s lease expense were as follows:


	Three Months Ended						Nine Months Ended
	September 30,			October 1,			September 30,		October 1,
	2023			2022			2023		2022
Operating lease cost:
Fixed lease cost	$	4,312		$	9,071		$	17,423	$	24,974
Lease termination (benefit) cost		(538	)		(189	)		11,512		1,912
Variable lease cost		15			7			46		20
Total operating lease cost	$	3,789		$	8,889		$	28,981	$	26,906
Finance lease cost:
Amortization of leased assets		5			25		$	43	$	86
Interest on lease liabilities		0			4			1		6
Total finance lease cost	$	5		$	29		$	44	$	92
Total lease cost	$	3,794		$	8,918		$	29,025	$	26,998

As previously disclosed, in conjunction with the continued rationalization of its real estate portfolio, the Company entered into subleases with commencement dates in the first quarter of fiscal 2023. The Company recorded $931 and $2,455 of sublease income for the three and nine months ended September 30, 2023, respectively, as an offset to general and administrative expenses.

At September 30, 2023 and December 31, 2022, the Company’s weighted average remaining lease term and weighted average discount rates were as follows:


	September 30, 2023		December 31, 2022
Weighted Average Remaining Lease Term (years)
Operating leases		7.42		6.90
Finance leases		0.62		1.00

Weighted Average Discount Rate
Operating leases		7.48		7.03
Finance leases		3.91		3.52

The Company’s leases have remaining lease terms of 0 to 9 years with a weighted average lease term of 7.42 years as of September 30, 2023.

At September 30, 2023, the maturity of the Company’s lease liabilities in each of the next five fiscal years and thereafter were as follows:


	Operating Leases		Finance Leases		Total
Remainder of fiscal 2023	$	2,778	$	2	$	2,780
Fiscal 2024		15,307		7		15,314
Fiscal 2025		13,054		—		13,054
Fiscal 2026		10,056		—		10,056
Fiscal 2027		9,590		—		9,590
Fiscal 2028		9,277		—		9,277
Thereafter		26,919		—		26,919
Total lease payments	$	86,981	$	9	$	86,990
Less imputed interest		20,534		0		20,534
Present value of lease liabilities	$	66,447	$	9	$	66,456

Supplemental cash flow information related to leases for the nine months ended September 30, 2023 and October 1, 2022 were as follows:


	Nine Months Ended
	September 30,			October 1,
	2023			2022
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	17,826		$	24,244
Operating cash flows from finance leases	$	1		$	6
Financing cash flows from finance leases	$	43		$	86

Lease assets (modified) obtained in exchange for (modified) new operating lease liabilities	$	(6,683	)	$	11,160
Lease assets obtained in exchange for new finance lease liabilities	$	—		$	44