Leases

3 Months Ended

Apr. 04, 2020

Leases [Abstract]

Leases

LeasesThe Company leases its principal facilities located in San Francisco, California. The Company also leases office space in various locations. Both the Company’s principal facilities and leases in various locations have expiration dates between 2020 and 2024. The lease agreements often include leasehold improvement incentives, escalating lease payments, renewal provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs or defined rent increases. The Company’s leases are primarily accounted for as operating leases. Operating lease ROU assets and short-term and long-term operating lease liabilities are included on the face of the condensed consolidated balance sheet. Finance lease ROU assets are presented within other assets, and finance lease liabilities are presented within accrued liabilities. The Company has no leases that have not yet commenced as of April 4, 2020.

Total lease cost consists of the following (in thousands):

	Three Months Ended
	April 4, 2020		March 30, 2019
Finance lease costs:
Amortization of ROU assets	$	169	$	573
Interest on lease liabilities	—		—
Operating lease costs(1)	6,643		7,574
Variable lease costs	891		1,315
Sublease income	(598)		(1,966)
Total lease costs	$	7,105	$	7,496

⁽¹⁾ includes short-term leases, which are immaterial.

Supplemental cash flow information related to leases was as follows (in thousands):

	Three Months Ended
	April 4, 2020		March 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows from finance leases	$	—	$	597
Operating cash flows from finance leases	—		—
Operating cash flows from operating leases	6,539		5,512
ROU assets obtained in exchange for lease obligations:
Finance lease liabilities	$	1,384	$	—
Operating lease liabilities	4,497		288

Supplemental balance sheet information related to leases was as follows (in thousands):

	April 4, 2020		December 31, 2019
Finance leases:
Other assets	$	1,215	$	1,384
Accrued liabilities	$	1,384	$	1,384
Operating leases:
Operating lease ROU assets	$	70,137	$	70,225
Operating lease liabilities	$	21,832	$	23,511
Long-term operating lease liabilities	66,234		67,902
Total operating lease liabilities	$	88,066	$	91,413

Weighted-average lease terms and discount rates are as follows:

	April 4, 2020		December 31, 2019
Weighted-average remaining lease terms (in years):
Finance leases	0.3		0.5
Operating leases	4.0		4.2
Weighted-average discount rates:
Finance leases	—	%	—	%
Operating leases	5.5	%	5.5	%

Maturities of lease liabilities as of April 4, 2020 were as follow (in thousands):

	Finance Leases		Operating Leases
Remaining 2020	$	1,384	$	25,262
2021	—		24,894
2022	—		24,390
2023	—		21,769
2024	—		9,525
Thereafter	—		—
Total minimum lease payments	$	1,384	$	105,840
Less: amount representing interest	—		(17,774)
Total lease liabilities	$	1,384	$	88,066

Leases

LeasesThe Company leases its principal facilities located in San Francisco, California. The Company also leases office space in various locations. Both the Company’s principal facilities and leases in various locations have expiration dates between 2020 and 2024. The lease agreements often include leasehold improvement incentives, escalating lease payments, renewal provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs or defined rent increases. The Company’s leases are primarily accounted for as operating leases. Operating lease ROU assets and short-term and long-term operating lease liabilities are included on the face of the condensed consolidated balance sheet. Finance lease ROU assets are presented within other assets, and finance lease liabilities are presented within accrued liabilities. The Company has no leases that have not yet commenced as of April 4, 2020.

Total lease cost consists of the following (in thousands):

	Three Months Ended
	April 4, 2020		March 30, 2019
Finance lease costs:
Amortization of ROU assets	$	169	$	573
Interest on lease liabilities	—		—
Operating lease costs(1)	6,643		7,574
Variable lease costs	891		1,315
Sublease income	(598)		(1,966)
Total lease costs	$	7,105	$	7,496

⁽¹⁾ includes short-term leases, which are immaterial.

Supplemental cash flow information related to leases was as follows (in thousands):

	Three Months Ended
	April 4, 2020		March 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows from finance leases	$	—	$	597
Operating cash flows from finance leases	—		—
Operating cash flows from operating leases	6,539		5,512
ROU assets obtained in exchange for lease obligations:
Finance lease liabilities	$	1,384	$	—
Operating lease liabilities	4,497		288

Supplemental balance sheet information related to leases was as follows (in thousands):

	April 4, 2020		December 31, 2019
Finance leases:
Other assets	$	1,215	$	1,384
Accrued liabilities	$	1,384	$	1,384
Operating leases:
Operating lease ROU assets	$	70,137	$	70,225
Operating lease liabilities	$	21,832	$	23,511
Long-term operating lease liabilities	66,234		67,902
Total operating lease liabilities	$	88,066	$	91,413

Weighted-average lease terms and discount rates are as follows:

	April 4, 2020		December 31, 2019
Weighted-average remaining lease terms (in years):
Finance leases	0.3		0.5
Operating leases	4.0		4.2
Weighted-average discount rates:
Finance leases	—	%	—	%
Operating leases	5.5	%	5.5	%

Maturities of lease liabilities as of April 4, 2020 were as follow (in thousands):

	Finance Leases		Operating Leases
Remaining 2020	$	1,384	$	25,262
2021	—		24,894
2022	—		24,390
2023	—		21,769
2024	—		9,525
Thereafter	—		—
Total minimum lease payments	$	1,384	$	105,840
Less: amount representing interest	—		(17,774)
Total lease liabilities	$	1,384	$	88,066