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Leases

3 Months Ended

Mar. 31, 2019

Lessee Disclosures

Our operating leases consist primarily of leases for office space, data centers and satellite ground facilities. We recognized right-of-use assets and lease liabilities for such leases in connection with our adoption of ASC 842 as of January 1, 2019 (see Note 2). We report operating lease right-of-use assets in Operating lease right-of-use assets and we report the current and noncurrent portions of our operating lease liabilities in Accrued expenses and other and Operating lease liabilities, respectively. Our finance leases consist primarily of leases of satellite capacity. We report finance lease right-of-use assets in Property and equipment, net and we report the current and noncurrent portions of our finance lease liabilities in Current portion of long-term debt and finance lease obligations and Long-term debt and finance lease obligations, respectively. Our consolidated balance sheet includes the following amounts for right-of-use assets and lease liabilities as of March 31, 2019 (in thousands):



Right-of-use assets:
Operating	$	115,647
Finance	563,350
Total right-of-use assets	$	678,997

Lease liabilities:
Current:
Operating	$	17,453
Finance	41,651
Noncurrent:
Operating	95,215
Finance	177,293
Total lease liabilities	$	331,612

Finance lease assets are reported net of accumulated amortization of $490 million as of March 31, 2019.

The following table details components of lease cost, weighted average lease terms and discount rates, and cash flows for operating leases and finance leases:



	For the three months ended March 31, 2019
	(In thousands)
Lease cost
Operating lease cost	$	5,867
Finance lease cost:
Amortization of right-of-use assets	20,666
Interest on lease liabilities	6,018
Short-term lease cost	120
Variable lease cost	1,970
Total lease cost	$	34,641



	As of
	March 31, 2019
	(In thousands)
Lease term and discount rate
Weighted average remaining lease term (in years):
Finance leases	4.82
Operating leases	10.27

Weighted average discount rate:
Finance leases	10.75	%
Operating leases	6.19	%



	For the three months ended March 31, 2019
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	5,371
Operating cash flows from finance leases	$	6,018
Financing cash flows from finance leases	$	9,758

We obtained right-of-use assets in exchange for lease liabilities of $1 million upon commencement of operating leases for the three months ended March 31, 2019.

The following table presents maturities of our lease liabilities as of March 31, 2019:



Maturity of lease liabilities	Operating leases			Finance leases			Total
	(In thousands)
Year ending December 31,
2019 (remainder)	$	17,322		$	47,400		$	64,722
2020	18,962			63,266			82,228
2021	15,817			59,692			75,509
2022	13,923			41,040			54,963
2023	13,341			40,942			54,283
After 2023	75,274			30,707			105,981
Total lease payments	154,639			283,047			437,686
Less interest	(41,972		)	(64,102		)	(106,074		)
Present value of lease liabilities	$	112,667		$	218,945		$	331,612

As of December 31, 2018, our future minimum rental payments under noncancelable operating leases were as follows:



Year ending December 31,	(In thousands)
2019	$	21,146
2020	18,081
2021	13,873
2022	10,118
2023	8,814
Thereafter	21,886
Total	$	93,918

Lessor Disclosures

We report revenue from sales-type leases at the commencement date in Equipment revenue and we report periodic interest income on sales-type lease receivables in Services and other revenue. We report operating lease revenue in Services and other revenue. The following table details our lease revenue for the three months ended March 31, 2019 (in thousands):



Sales-type lease revenue:
Revenue at lease commencement	$	688
Interest income	252
Operating lease revenue	92,857
Total lease revenue	$	93,797

Substantially all of our net investment in sales-type leases consisted of lease receivables totaling $3 million as of March 31, 2019.

The following table presents maturities of our operating lease payments as of March 31, 2019:



	Operating leases
Year ending December 31,	(In thousands)
2019 (remainder)	$	242,239
2020	260,033
2021	231,790
2022	150,233
2023	40,327
After 2023	194,679
Total lease payments	$	1,119,301

Property and equipment, net as of March 31, 2019 and Depreciation and amortization for the three months then ended included the following amounts for assets subject to operating leases:



			Accumulated		Depreciation
	Cost		depreciation		expense
	(in thousands)
Customer premises equipment	$	1,210,850	$	905,731	$	45,812
Satellites	1,552,245		847,160		32,601
Real estate	100,037		30,278		558
Total	$	2,863,132	$	1,783,169	$	78,971

LEASES

Lessee Disclosures



Right-of-use assets:
Operating	$	115,647
Finance	563,350
Total right-of-use assets	$	678,997

Lease liabilities:
Current:
Operating	$	17,453
Finance	41,651
Noncurrent:
Operating	95,215
Finance	177,293
Total lease liabilities	$	331,612

Finance lease assets are reported net of accumulated amortization of $490 million as of March 31, 2019.

The following table details components of lease cost, weighted average lease terms and discount rates, and cash flows for operating leases and finance leases:



	For the three months ended March 31, 2019
	(In thousands)
Lease cost
Operating lease cost	$	5,867
Finance lease cost:
Amortization of right-of-use assets	20,666
Interest on lease liabilities	6,018
Short-term lease cost	120
Variable lease cost	1,970
Total lease cost	$	34,641



	As of
	March 31, 2019
	(In thousands)
Lease term and discount rate
Weighted average remaining lease term (in years):
Finance leases	4.82
Operating leases	10.27

Weighted average discount rate:
Finance leases	10.75	%
Operating leases	6.19	%



	For the three months ended March 31, 2019
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	5,371
Operating cash flows from finance leases	$	6,018
Financing cash flows from finance leases	$	9,758

We obtained right-of-use assets in exchange for lease liabilities of $1 million upon commencement of operating leases for the three months ended March 31, 2019.

The following table presents maturities of our lease liabilities as of March 31, 2019:



Maturity of lease liabilities	Operating leases			Finance leases			Total
	(In thousands)
Year ending December 31,
2019 (remainder)	$	17,322		$	47,400		$	64,722
2020	18,962			63,266			82,228
2021	15,817			59,692			75,509
2022	13,923			41,040			54,963
2023	13,341			40,942			54,283
After 2023	75,274			30,707			105,981
Total lease payments	154,639			283,047			437,686
Less interest	(41,972		)	(64,102		)	(106,074		)
Present value of lease liabilities	$	112,667		$	218,945		$	331,612

As of December 31, 2018, our future minimum rental payments under noncancelable operating leases were as follows:



Year ending December 31,	(In thousands)
2019	$	21,146
2020	18,081
2021	13,873
2022	10,118
2023	8,814
Thereafter	21,886
Total	$	93,918

Lessor Disclosures



Sales-type lease revenue:
Revenue at lease commencement	$	688
Interest income	252
Operating lease revenue	92,857
Total lease revenue	$	93,797

Substantially all of our net investment in sales-type leases consisted of lease receivables totaling $3 million as of March 31, 2019.

The following table presents maturities of our operating lease payments as of March 31, 2019:



	Operating leases
Year ending December 31,	(In thousands)
2019 (remainder)	$	242,239
2020	260,033
2021	231,790
2022	150,233
2023	40,327
After 2023	194,679
Total lease payments	$	1,119,301

Property and equipment, net as of March 31, 2019 and Depreciation and amortization for the three months then ended included the following amounts for assets subject to operating leases:



			Accumulated		Depreciation
	Cost		depreciation		expense
	(in thousands)
Customer premises equipment	$	1,210,850	$	905,731	$	45,812
Satellites	1,552,245		847,160		32,601
Real estate	100,037		30,278		558
Total	$	2,863,132	$	1,783,169	$	78,971

LEASES

Lessee Disclosures



Right-of-use assets:
Operating	$	115,647
Finance	563,350
Total right-of-use assets	$	678,997

Lease liabilities:
Current:
Operating	$	17,453
Finance	41,651
Noncurrent:
Operating	95,215
Finance	177,293
Total lease liabilities	$	331,612

Finance lease assets are reported net of accumulated amortization of $490 million as of March 31, 2019.

The following table details components of lease cost, weighted average lease terms and discount rates, and cash flows for operating leases and finance leases:



	For the three months ended March 31, 2019
	(In thousands)
Lease cost
Operating lease cost	$	5,867
Finance lease cost:
Amortization of right-of-use assets	20,666
Interest on lease liabilities	6,018
Short-term lease cost	120
Variable lease cost	1,970
Total lease cost	$	34,641



	As of
	March 31, 2019
	(In thousands)
Lease term and discount rate
Weighted average remaining lease term (in years):
Finance leases	4.82
Operating leases	10.27

Weighted average discount rate:
Finance leases	10.75	%
Operating leases	6.19	%



	For the three months ended March 31, 2019
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	5,371
Operating cash flows from finance leases	$	6,018
Financing cash flows from finance leases	$	9,758

We obtained right-of-use assets in exchange for lease liabilities of $1 million upon commencement of operating leases for the three months ended March 31, 2019.

The following table presents maturities of our lease liabilities as of March 31, 2019:



Maturity of lease liabilities	Operating leases			Finance leases			Total
	(In thousands)
Year ending December 31,
2019 (remainder)	$	17,322		$	47,400		$	64,722
2020	18,962			63,266			82,228
2021	15,817			59,692			75,509
2022	13,923			41,040			54,963
2023	13,341			40,942			54,283
After 2023	75,274			30,707			105,981
Total lease payments	154,639			283,047			437,686
Less interest	(41,972		)	(64,102		)	(106,074		)
Present value of lease liabilities	$	112,667		$	218,945		$	331,612

As of December 31, 2018, our future minimum rental payments under noncancelable operating leases were as follows:



Year ending December 31,	(In thousands)
2019	$	21,146
2020	18,081
2021	13,873
2022	10,118
2023	8,814
Thereafter	21,886
Total	$	93,918

Lessor Disclosures



Sales-type lease revenue:
Revenue at lease commencement	$	688
Interest income	252
Operating lease revenue	92,857
Total lease revenue	$	93,797

Substantially all of our net investment in sales-type leases consisted of lease receivables totaling $3 million as of March 31, 2019.

The following table presents maturities of our operating lease payments as of March 31, 2019:



	Operating leases
Year ending December 31,	(In thousands)
2019 (remainder)	$	242,239
2020	260,033
2021	231,790
2022	150,233
2023	40,327
After 2023	194,679
Total lease payments	$	1,119,301

Property and equipment, net as of March 31, 2019 and Depreciation and amortization for the three months then ended included the following amounts for assets subject to operating leases:



			Accumulated		Depreciation
	Cost		depreciation		expense
	(in thousands)
Customer premises equipment	$	1,210,850	$	905,731	$	45,812
Satellites	1,552,245		847,160		32,601
Real estate	100,037		30,278		558
Total	$	2,863,132	$	1,783,169	$	78,971

LEASES

Lessee Disclosures



Right-of-use assets:
Operating	$	115,647
Finance	563,350
Total right-of-use assets	$	678,997

Lease liabilities:
Current:
Operating	$	17,453
Finance	41,651
Noncurrent:
Operating	95,215
Finance	177,293
Total lease liabilities	$	331,612

Finance lease assets are reported net of accumulated amortization of $490 million as of March 31, 2019.

The following table details components of lease cost, weighted average lease terms and discount rates, and cash flows for operating leases and finance leases:



	For the three months ended March 31, 2019
	(In thousands)
Lease cost
Operating lease cost	$	5,867
Finance lease cost:
Amortization of right-of-use assets	20,666
Interest on lease liabilities	6,018
Short-term lease cost	120
Variable lease cost	1,970
Total lease cost	$	34,641



	As of
	March 31, 2019
	(In thousands)
Lease term and discount rate
Weighted average remaining lease term (in years):
Finance leases	4.82
Operating leases	10.27

Weighted average discount rate:
Finance leases	10.75	%
Operating leases	6.19	%



	For the three months ended March 31, 2019
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	5,371
Operating cash flows from finance leases	$	6,018
Financing cash flows from finance leases	$	9,758

We obtained right-of-use assets in exchange for lease liabilities of $1 million upon commencement of operating leases for the three months ended March 31, 2019.

The following table presents maturities of our lease liabilities as of March 31, 2019:



Maturity of lease liabilities	Operating leases			Finance leases			Total
	(In thousands)
Year ending December 31,
2019 (remainder)	$	17,322		$	47,400		$	64,722
2020	18,962			63,266			82,228
2021	15,817			59,692			75,509
2022	13,923			41,040			54,963
2023	13,341			40,942			54,283
After 2023	75,274			30,707			105,981
Total lease payments	154,639			283,047			437,686
Less interest	(41,972		)	(64,102		)	(106,074		)
Present value of lease liabilities	$	112,667		$	218,945		$	331,612

As of December 31, 2018, our future minimum rental payments under noncancelable operating leases were as follows:



Year ending December 31,	(In thousands)
2019	$	21,146
2020	18,081
2021	13,873
2022	10,118
2023	8,814
Thereafter	21,886
Total	$	93,918

Lessor Disclosures



Sales-type lease revenue:
Revenue at lease commencement	$	688
Interest income	252
Operating lease revenue	92,857
Total lease revenue	$	93,797

Substantially all of our net investment in sales-type leases consisted of lease receivables totaling $3 million as of March 31, 2019.

The following table presents maturities of our operating lease payments as of March 31, 2019:



	Operating leases
Year ending December 31,	(In thousands)
2019 (remainder)	$	242,239
2020	260,033
2021	231,790
2022	150,233
2023	40,327
After 2023	194,679
Total lease payments	$	1,119,301

Property and equipment, net as of March 31, 2019 and Depreciation and amortization for the three months then ended included the following amounts for assets subject to operating leases:



			Accumulated		Depreciation
	Cost		depreciation		expense
	(in thousands)
Customer premises equipment	$	1,210,850	$	905,731	$	45,812
Satellites	1,552,245		847,160		32,601
Real estate	100,037		30,278		558
Total	$	2,863,132	$	1,783,169	$	78,971