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Note 10 - Leases

12 Months Ended

Sep. 30, 2025

10. Leases

As Lessee

The Company has elected not to record operating right-of-use assets or operating lease liabilities on its consolidated balance sheet for leases having a minimum term of 12 months or less. Such leases are expensed on a straight-line basis over the lease term. Variable lease payments are excluded from the measurement of operating right-of-use assets and operating liabilities and recognized in the period in which the obligation for those payments is incurred. As of September 30, 2025, the Company has two operating right-of use assets related to leased facilities in Austin, Texas and Melbourne, Florida.

Maturities of the operating lease liabilities as of September 30, 2025 were as follows (in thousands):

For fiscal years ending September 30,
2026	$	465
2027		483
2028		90
Future minimum lease payments	$	1,038
Less interest		(64	)
Present value of minimum lease payments	$	974
Less current portion		(420	)
Long-term portion	$	554

Lease costs recognized in the consolidated statements of operations for the fiscal years ended September 30, 2025 and 2024 is as follows (in thousands):

	*YEAR ENDED SEPTEMBER 30,*
	*2025*		*2024*
Right-of-use operating lease costs	$	198	$	271
Short-term lease costs		121		123
Total	$	319	$	394

Right-of-use operating lease costs and short-term lease costs are included as a component of total operating expenses.

Other information related to operating leases is as follows (in thousands):

	*YEAR ENDED SEPTEMBER 30,*
	*2025*			*2024*
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	126		$	278

Weighted average remaining lease term	2.9 years			3.4 years
Weighted average discount rate		5.93	%		3.25	%

The discount rate used on the operating right-of-use assets represented the Company’s incremental borrowing rate at lease inception.

As Lessor

Equipment

The Company leases equipment to customers which generally range from daily rentals to minimum rental periods of up to one year. All of the Company's current leasing arrangements, with the Company acting as lessor, are classified as operating leases. The majority of the Company’s rental revenue is generated from its marine-based wireless seismic data acquisition system.

The Company regularly evaluates the collectability of its lease receivables on a lease-by-lease basis. The evaluation primarily consists of reviewing past due account balances and other factors such as the credit quality of the customer, historical trends of the customer and current economic conditions. The Company suspends revenue recognition when the collectability of amounts due are no longer probable and concurrently records a direct write-off of the lease receivable to rental revenue to limit rental revenue recognized to the cash collections received. As of September 30, 2025 and 2024, the Company’s trade accounts receivables included lease receivables of $1.0 million and $1.0 million, respectively.

Rental revenue related to leased equipment for fiscal years 2025 and 2024 were $6.3 million and $19.3 million, respectively.

Future minimum lease obligations due from the Company's leasing customers as of September 30, 2025 were $0.4 million, all of which is due within the next 12 months.

In November 2024, the Company entered into a sales-type lease with a customer on wireless seismic equipment from its rental fleet. The lease matures in October 2025. Interest income of $0.6 million was recognized on the lease for the fiscal year ended September 30, 2025. Ownership of the equipment will transfer to the customer at the end of the lease term. Also see Note 8.

Rental equipment consisted of the following (in thousands):

	*AS OF SEPTEMBER 30,*
	*2025*			*2024*
Rental equipment, primarily wireless recording equipment	$	45,289		$	63,111
Accumulated depreciation and impairment		(37,169	)		(48,925	)
	$	8,120		$	14,186

Rental equipment depreciation expense was $6.2 million and $10.9 million in fiscal years 2025 and 2024, respectively.

Property

During fiscal year 2022, the Company leased a portion of its property located in Calgary, Alberta, Canada and fully leased its warehouse in Bogotá, Colombia. The lease in Canada commenced in November 2021 and is for a five-year term. The lease on the warehouse in Bogotá commenced in December 2021 and is currently on a month-to-month basis.

Rental revenue related to these two properties for each of the fiscal years ended September 30, 2025 and 2024 was $0.3 million.

Future minimum lease payments due to the Company as of September 30, 2025 were as follows (in thousands):

For fiscal years ending September 30,
2026	$	132
2027		11
	$	143