Note 11 - Leases

12 Months Ended

Dec. 31, 2024

Notes to Financial Statements

Lessee Operating and Finance Leases [Text Block]

11. LEASES

The Company leases various property and equipment under operating lease arrangements. The Company recognizes operating lease assets and liabilities on the balance sheet and discloses key information regarding leasing arrangements. The Company has elected to apply the short-term lease exception to all leases of one year or less.

 As of December 31, 2024, the right-of-use (“ROU”) asset had a balance of $13,841 which is included in the “Operating lease right-of-use assets” line item of these consolidated financial statements and current and non-current lease liabilities relating to the ROU asset of $2,115 and $13,799, respectively, and are included in the “Current portion of operating lease obligations” and “Long-term operating lease obligations, net of current portion” line items of these consolidated financial statements. As of December 31, 2023, the ROU asset had a balance of $15,593 and current and non-current lease liabilities relating to the ROU asset of $1,851 and $15,888, respectively. The discount rates used for leases accounted for under Topic 842 are based on an interest rate yield curve developed for the leases in the Company’s lease portfolio. 

Lease terms generally range from 3 to 15 years with renewal options for extended terms. Some of the Company’s facility leases include options to renew. The exercise of the renewal options is at the Company’s discretion. Therefore, the majority of renewals to extend the lease terms are not included in ROU assets and lease liabilities as they are not reasonably certain of exercise. The Company regularly evaluates the renewal options and includes them in the lease term when the Company is reasonably certain to exercise them. Certain leases contain rent escalation clauses that require additional rental payments in the later years of the term. Rent expense for these types of leases is recognized on a straight-line basis over the lease term. Operating rental expense for the years ended December 31, 2024 and 2023 was $4,208 and $4,201, respectively.

In addition, the Company has entered into finance lease arrangements to finance property and equipment and assumed finance lease obligations in connection with certain acquisitions. The related assets are included in the “Property and equipment, net” line item of these consolidated financial statements and the liabilities are included in the “Current portion of finance lease obligations” line item and “Long-term finance lease obligations, net of current portion” line item of these consolidated financial statements. Finance lease cost for the years ended December 31, 2024 and 2023 was $1,946 and $1,790, respectively.

Amortization expense recorded in connection with assets recorded under finance leases was $1,473 and $1,263 for the years ended December 31, 2024 and 2023, respectively.

Quantitative information regarding the Company’s leases is as follows:

	Year Ended December 31,
	2024			2023
Components of lease cost
Finance lease cost components:
Amortization of finance lease assets	$	1,473		$	1,263
Interest on finance lease liabilities		473			527
Total finance lease costs		1,946			1,790
Operating lease cost components:
Operating lease cost		2,694			2,792
Short-term lease cost		192			361
Variable lease cost (1)		1,524			1,260
Sublease income		(200	)		(212	)
Total operating lease costs		4,210			4,201
Total lease cost	$	6,156		$	5,991
Supplemental cash flow information related to our operating leases is as follows for the twelve months ended December 31, 2024 and 2023:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflow from operating leases	$	3,359		$	3,460
Right-of-use assets obtained in exchange for new
operating lease liabilities	$	29		$	983
Weighted-average remaining lease term-finance leases at end of period (in years)		2.8			3.2
Weighted-average remaining lease term-operating leases at end of period (in years)		6.2			7.1
Weighted-average discount rate-finance leases at end of period		5.3	%		6.1	%
Weighted-average discount rate-operating leases at end of period		8.9	%		8.5	%

(1) Variable lease costs consist primarily of taxes, insurance, utilities, and common area or other maintenance costs for the Company’s leased facilities and equipment.

Amortization associated with new right-of-use assets obtained in exchange for new operating lease liabilities is $4 and $5 for the years ended December 31, 2024 and 2023, respectively. 

As of December 31, 2024, future minimum lease payments under finance leases and operating leases were as follows:

	Finance			Operating
	Leases			Leases			Total
2025	$	2,581		$	3,455		$	6,036
2026		1,508			3,449			4,957
2027		1,212			3,151			4,363
2028		952			3,160			4,112
2029		526			3,187			3,713
2030 and thereafter		—			4,618			4,618
Total lease payments		6,779			21,020			27,799
Less—portion representing interest		(736	)		(5,106	)		(5,842	)
Present value of lease obligations		6,043			15,914			21,957
Less—current portion of lease obligations		(2,266	)		(2,115	)		(4,381	)
Long-term portion of lease obligations	$	3,777		$	13,799		$	17,576