Leases (Tables)

12 Months Ended

Dec. 31, 2023

The components of lease costs in the accompanying consolidated statements of operations are as follows (in thousands):


		Year Ended December 31,
Lease and lease financing cost	Classification	2023		2022		2021
Finance lease cost:
Amortization of lease assets	Depreciation (1)	$	4,944	$	1,540	$	1,097
Interest on lease liabilities	Interest and other financing expenses	1,463		108		90
Lease financing transactions:(2)
Depreciation	Depreciation (1)	7,698		5,303		3,423
Interest	Interest and other financing expenses	12,992		8,405		5,472
Operating lease cost	Cost of services and Selling, general and administrative expenses	93,133		93,539		104,668
Short-term and variable lease cost (3)	Cost of services and Selling, general and administrative expenses	1,106,454		953,721		716,722
Total lease and lease financing transactions cost		$	1,226,684	$	1,062,616	$	831,472

(1) Depreciation is included within “Cost of services” and “Selling, general and administrative expenses” in the accompanying consolidated statements of operations.

(2) Certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. When these purchase options are exercised by a third-party lessor on behalf of Quanta, the transaction is deemed to be a financing transaction for accounting purposes, which results in the recognition of an asset equal to the purchase price and a corresponding liability.

(3) Short-term lease cost includes both leases and rentals with initial terms of one year or less. Variable lease cost is insignificant.

Components of Leases in the Balance Sheet

The components of leases in the accompanying consolidated balance sheets were as follows (in thousands):


		December 31,
Lease type	Classification	2023		2022
Assets:
Operating lease right-of-use assets	Operating lease right-of-use assets	$	249,443	$	229,691
Finance lease assets	Property and equipment, net of accumulated depreciation	35,770		3,238
Lease financing transaction assets	Property and equipment, net of accumulated depreciation	102,955		83,591
Total lease and lease financing assets		$	388,168	$	316,520
Liabilities:
Current:
Operating	Current portion of operating lease liabilities	$	77,995	$	74,052
Finance	Current maturities of long-term debt and short-term debt	7,767		1,433
Lease financing transaction liabilities	Current maturities of long-term debt and short-term debt	7,345		15,034

Non-current:
Operating	Operating lease liabilities, net of current portion	186,996		171,512
Finance	Long-term debt, net of current maturities	31,810		2,109
Lease financing transaction liabilities	Long-term debt, net of current maturities	95,610		68,557
Total lease and lease financing liabilities		$	407,523	$	332,697

Future Minimum Lease Payments - Operating Leases

Future minimum lease payments for operating leases, finance leases and lease financing transactions were as follows (in thousands):


	As of December 31, 2023
	Operating Leases		Finance Leases		Total
2024	$	87,354	$	8,869	$	96,223
2025	70,047		8,527		78,574
2026	52,359		8,277		60,636
2027	35,844		7,735		43,579
2028	20,782		7,418		28,200
Thereafter	24,856		6,003		30,859
Total future minimum payments related to operating leases, finance leases and lease financing transactions	291,242		46,829		338,071
Less imputed interest	(26,251)		(7,252)		(33,503)
Total	$	264,991	$	39,577	$	304,568

Future Minimum Lease Payments - Finance Leases and Equipment Lease Financing Transactions

Future minimum lease payments for operating leases, finance leases and lease financing transactions were as follows (in thousands):


	As of December 31, 2023
	Operating Leases		Finance Leases		Total
2024	$	87,354	$	8,869	$	96,223
2025	70,047		8,527		78,574
2026	52,359		8,277		60,636
2027	35,844		7,735		43,579
2028	20,782		7,418		28,200
Thereafter	24,856		6,003		30,859
Total future minimum payments related to operating leases, finance leases and lease financing transactions	291,242		46,829		338,071
Less imputed interest	(26,251)		(7,252)		(33,503)
Total	$	264,991	$	39,577	$	304,568

Other Information Related to Leases

The weighted average remaining lease terms and discount rates were as follows:


	As of December 31,
	2023		2022
Weighted average remaining lease term (in years):
Operating leases	4.34		4.39
Finance leases	5.69		2.93
Weighted average discount rate:
Operating leases	4.3	%	3.5	%
Finance leases	6.3	%	3.1	%