LEASES

9 Months Ended

Sep. 30, 2019

We have commitments under lease arrangements for data centers, office space, partner sites and equipment. Our leases have initial lease terms ranging from 2 years to 34 years, most of which include options to extend or renew the leases for 5 to 15 years, and some of which may include options to terminate the leases within 4 to 120 months.

At contract inception, we evaluate whether an arrangement is or contains a lease for which we are the lessee (that is, arrangements which provide us with the right to control a physical asset for a period of time). Operating leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Operating lease right-of-use assets" and lease liabilities recognized in "Short-term operating lease liabilities" and "Operating lease liabilities." Finance leases are accounted for on the condensed consolidated balance sheets with ROU assets being recognized in "Finance lease right-of-use assets" and lease liabilities recognized in "Short-term finance lease liabilities" and "Finance lease liabilities."

All lease liabilities are measured at the present value of the unpaid lease payments, discounted using our incremental borrowing rate based on the information available at commencement date or modification date of the lease. ROU assets, for both operating and finance leases, are initially measured based on the lease liability, adjusted for initial direct costs, prepaid rent, and lease incentives received. The operating lease ROU assets are subsequently measured at the carrying amount of the lease liability adjusted for initial direct costs, prepaid or accrued lease payments and lease incentives. The finance lease ROU assets are subsequently amortized using the straight-line method.

Operating lease expenses are recognized on a straight-line basis over the lease term. With respect to finance leases, amortization of the ROU asset is presented separately from interest expense related to the finance lease liability.

We have elected to combine lease and non-lease components for all lease contracts where we are the lessee. Additionally, for arrangements with lease terms of 12 months or less, we do not recognize ROU assets and lease liabilities and lease payments are recognized on a straight-line basis over the lease term with variable lease payments recognized in the period in which the obligation is incurred.

Lease-related costs for the three and nine months ended September 30, 2019 are as follows (in thousands):



	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Finance lease cost
Amortization of right-of-use assets		$	3,861	$	12,384
Interest on lease liabilities		7,445		22,124
Finance lease cost		$	11,306	$	34,508

Operating lease cost		$	2,269	$	5,964
Short-term lease cost		1,106		4,302
Total lease cost		$	14,681	$	44,774

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):



	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090

Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2019 (in thousands):



Operating Leases
Operating cash paid to settle operating lease liabilities	$	5,913

Right-of-use assets obtained in exchange for lease liabilities	921

Finance Leases
Operating cash paid for interest	$	17,577

Right-of-use assets obtained in exchange for lease liabilities	1,639

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):



	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

As of September 30, 2019, we did not have additional operating and finance leases that have not yet commenced.

LEASES

Lease-related costs for the three and nine months ended September 30, 2019 are as follows (in thousands):



	Three Months Ended September 30, 2019			Nine Months Ended September 30, 2019
Finance lease cost
Amortization of right-of-use assets		$	3,861	$	12,384
Interest on lease liabilities		7,445		22,124
Finance lease cost		$	11,306	$	34,508

Operating lease cost		$	2,269	$	5,964
Short-term lease cost		1,106		4,302
Total lease cost		$	14,681	$	44,774

Other information related to leases as of September 30, 2019 is as follows (in thousands, except lease term and rate):



	Operating Leases			Finance Leases
Right-of-use assets	$	33,723		$	226,619
Lease liabilities	37,068			270,090

Weighted-average remaining lease term (years)	5.26			19.05
Weighted-average discount rate	7.25		%	13.80		%

The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2019 (in thousands):



Operating Leases
Operating cash paid to settle operating lease liabilities	$	5,913

Right-of-use assets obtained in exchange for lease liabilities	921

Finance Leases
Operating cash paid for interest	$	17,577

Right-of-use assets obtained in exchange for lease liabilities	1,639

Future minimum lease payments under non-cancellable leases as of September 30, 2019 are as follows (in thousands):



	Operating Leases			Finance Leases
2019 (excluding the nine months ended September 30, 2019)		$	2,270		$	8,412
2020		9,073			33,406
2021		9,098			35,243
2022		8,519			33,995
2023		7,541			33,244
Thereafter		8,698			633,139
Total undiscounted lease payments		$	45,199		$	777,439
Less: Imputed interest		8,131			507,349
Total lease liabilities		$	37,068		$	270,090

As of September 30, 2019, we did not have additional operating and finance leases that have not yet commenced.