Leases

3 Months Ended

Mar. 31, 2026

Note 9. Leases

The Company leases real estate from unrelated parties under operating lease agreements that have initial terms ranging from one year to nine years. Some leases include one or more options to renew, generally at our sole discretion, of five additional years each.

The components of lease expense are as follows:


	Three months ended March 31,
		2026		2025
		(in thousands)

Operating lease cost		$	1,065	$	854
Variable lease cost		408		506
Short-term lease cost		70		77
Total lease cost		$	1,543	$	1,437

The Company ceased use of certain leased premises and subleased certain facilities resulting in impairment charges of $0.1 million during the three months ended March 31, 2026 to impair the right-of-use lease assets to their fair value, which are included in loss on sale and impairments on our unaudited condensed consolidated statement of operations and comprehensive income (loss).

Supplemental cash flow information related to leases is as follows:


	Three months ended March 31,
		2026		2025
		(in thousands)

Cash paid for operating lease liabilities		$	1,137	$	1,130

Operating lease assets obtained in exchange for operating lease liabilities		$	506	$	199

Supplemental balance sheet information, included in other non-current assets, accrued expenses and other and other non-current liabilities on the unaudited condensed consolidated balance sheets, related to leases is as follows:


	March 31,		December 31,
	2026		2025
	(in thousands)

Operating lease right-of-use assets	$	7,884	$	8,280

Current operating lease liabilities	3,890		3,850
Long-term operating lease liabilities	9,484		9,963
Total operating lease liabilities	$	13,374	$	13,813

At March 31, 2026 and December 31, 2025, the weighted average remaining lease term for operating leases was 3.94 years and 4.16 years, respectively, and the weighted average discount rate was 5.3% and 5.2%, respectively.

Future undiscounted cash flows for each of the next five years and thereafter and reconciliation to the lease liabilities recognized on the balance sheet as of March 31, 2026 is as follows (in thousands):


Year ended December 31,
2026 (remainder of year)	$	3,360
2027	3,716
2028	2,913
2029	2,551
2030	2,254
Thereafter	—
Total lease payments	14,794
Less: imputed interest	1,420
Total present value of lease liabilities	$	13,374