Leases

6 Months Ended

Jun. 30, 2022

NOTE 14 – LEASES

The Company leases office and research facilities, data centers and office equipment under operating leases which expire through 2029. The Company’s leases have remaining lease terms of one year to eight years, some of which may include options to extend the leases for five years or longer, and some of which may include options to terminate the leases within the next 7 years or less. Leases with an initial term of 12 months or less are not recorded on the balance sheets; expense for these leases is recognized on a straight-line basis over the lease term. Variable lease payments are expensed as incurred and are not included within the lease liability and right-of-use assets calculation. As a practical expedient, the Company elected, for all office and facility leases, not to separate non-lease components (e.g., common-area maintenance costs) from lease components (e.g., fixed payments including rent) and instead to account for each separate lease component and its associated non-lease components as a single lease component. As most of the leases do not provide an implicit rate, the Company generally, for purposes of discounting lease payments, uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date.

The Company subleases certain real estate to third parties. The sublease portfolio consists of operating leases for previously exited office space. Certain subleases include variable payments for operating costs. The subleases are generally co-terminus with the head lease, or shorter. Subleases do not include any residual value guarantees or restrictions or covenants imposed by the leases. Income from subleases is recognized as a reduction to selling, general and administrative expenses.

The components of operating lease costs were as follows (in thousands):


	Three Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2022			2021
Fixed lease cost (1)	$	5,463		$	5,528		$	10,989		$	10,994
Variable lease cost		1,506			1,187			2,780			2,552
Less: sublease income		(2,705	)		(3,157	)		(4,811	)		(5,346	)
Total operating lease cost	$	4,264		$	3,558		$	8,958		$	8,200

(1) Includes short-term leases, which were immaterial.

Other information related to leases was as follows (in thousands, except lease term and discount rate):


	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,439	$	5,761	$	11,024	$	11,316
ROU assets obtained in exchange for new lease liabilities:
Operating leases	$	1,195	$	3,478	$	3,103	$	3,478


	June 30, 2022			December 31, 2021
Weighted-average remaining lease term (years):
Operating leases		4.0			4.4
Weighted-average discount rate:
Operating leases		4.9	%		5.0	%

Future minimum lease payments and related lease liabilities as of June 30, 2022 were as follows (in thousands):


	Operating Lease Payments (1)			Sublease Income			Net Operating Lease Payments
2022 (remaining 6 months)	$	9,313		$	(3,735	)	$	5,578
2023		19,585			(7,618	)	$	11,967
2024		17,681			(7,610	)	$	10,071
2025		15,516			(7,386	)	$	8,130
2026		6,586			(935	)	$	5,651
Thereafter		3,182			—		$	3,182
Total lease payments		71,863			(27,284	)		44,579
Less: imputed interest		(7,092	)		—			(7,092	)
Present value of lease liabilities:	$	64,771		$	(27,284	)	$	37,487

Less: current obligations under leases (accrued liabilities)		16,319
Noncurrent operating lease liabilities	$	48,452

(1) Future minimum lease payments exclude short-term leases as well as payments to landlords for variable common area maintenance, insurance and real estate taxes.