Leases

9 Months Ended

Dec. 31, 2024

The Company has entered into operating leases for its corporate offices and storage spaces, with remaining contractual periods ranging from 1.0 year to 6.6 years. For the Company’s facility in Sunnyvale, California (the “Sunnyvale facility”), there is an option to extend the lease for a period of seven years. The Company is not reasonably certain that it will exercise this option and therefore it is not included in its ROU assets and lease liabilities as of December 31, 2024. The Company did not have any finance leases for the periods presented.

In connection with the November 2024 Reduction Plan, the Company abandoned the South San Francisco Facility in December 2024. See Note 3, “Discontinued Operations,” for details.

On September 16, 2024, the Company entered into an agreement with a third party to sublease 17,312 square feet of the Sunnyvale facility. The total rental commitment over the four-year term of the sublease is $3.2 million. The Company’s sublease agreement: (i) includes renewal and termination options; (ii) provides for customary escalations of lease payments in the normal course of business; (iii) grants the subtenant free rent for specific months during term; (iv) requires variable payments that are dependent on usage, output, or may vary for other reasons, such as insurance and tax payments; and (v) grants the subtenant title of furniture if it extends the lease. The sublease is classified as operating leases

whereby sublease income is recognized on a straight-line basis over the sublease term that expires in 2028. Sublease income was $0.3 million for both the three and nine months ended December 31, 2024. There was no sublease income recognized during the three and nine months ended December 31, 2023.

For continuing operations for the three months ended December 31, 2024 and 2023, the Company recorded operating lease costs of $2.2 million and $2.3 million, respectively, and variable operating lease costs of $0.7 million and $1.3 million, respectively. For continuing operations for the nine months ended December 31, 2024 and 2023, the Company recorded operating lease costs of $6.8 million and $7.0 million, respectively, and variable operating lease costs of $3.1 million and $3.4 million, respectively.

As of December 31, 2024, the future minimum lease payments included in the measurement of the Company’s operating lease liabilities from continuing operations were as follows:


	December 31, 2024
	(in thousands)
Fiscal years ending March 31,
Remainder of 2025 (Remaining three months)	$	1,878
2026	11,355
2027	11,536
2028	11,666
2029	12,016
Thereafter	29,413
Total future operating lease payments	77,864
Less: imputed interest	(17,320)
Total operating lease liabilities	$	60,544