Leases

12 Months Ended

Mar. 31, 2025

Note 7 — Leases

The Company’s operating leases consist primarily of leases for office space, data centers and satellite ground facilities and have remaining terms that typically range from less than one year to 17 years, some of which include renewal options, and some of which include options to terminate the leases within one year. Certain earth station leases have renewal terms that have been deemed to be reasonably certain to be exercised and as such have been recognized as part of the Company’s right-of-use assets and lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company recognizes right-of-use assets and lease liabilities for such leases in accordance with ASC 842. The Company reports operating lease right-of-use assets in operating lease right-of-use assets and the current and non-current portions of its operating lease liabilities in accrued and other liabilities and non-current operating lease liabilities, respectively, in the consolidated balance sheets.

The Company’s finance leases consist primarily of satellite lifetime Ka-band capacity leases and have remaining terms from less than one year to 15 years. The Company reports assets obtained under finance leases in property, equipment and satellites, net and the current and non-current portions of its finance lease liabilities in current portion of long-term debt and other long-term debt, respectively, in the consolidated balance sheets.

During the fourth quarter of fiscal year 2023, after the completion of the Link-16 TDL Sale, the Company reduced its real estate footprint as part of cost-reduction measures taken in order to right-size the Company’s remaining businesses. As a result, the Company recorded an impairment of right-of-use assets of $19.1 million and an impairment of leasehold improvements and furniture and fixtures of an insignificant amount, taking into consideration the current and anticipated future market conditions for sublease income in the markets the leases are located, recorded in the consolidated statements of operations in selling, general and administrative expenses in both of the Company's segments.

The components of the Company's lease costs, weighted average lease terms and discount rates are presented in the tables below:


	Fiscal Years Ended
	March 31, 2025		March 31, 2024		March 31, 2023
	(In thousands)
Lease cost:
Operating lease cost	$	99,067	$	105,365	$	87,627
Finance lease cost:
Depreciation of assets obtained under finance leases		14,948		11,824		11,947
Interest on lease liabilities		6,514		2,018		2,441
Short-term lease cost		21,559		13,990		14,410
Variable lease cost		27,067		13,214		15,261
Net lease cost	$	169,155	$	146,411	$	131,686


	As of			As of			As of
	March 31, 2025			March 31, 2024			March 31, 2023
Lease term and discount rate:
Weighted average remaining lease term (in years):
Operating leases		8.5			7.3			6.3
Finance leases	13.5			2.4				3.4

Weighted average discount rate:
Operating leases		6.2	%		6.2	%		5.7	%
Finance leases		10.5	%		6.3	%		6.3	%

The following table details components of the consolidated statements of cash flows for operating and finance leases:


	Fiscal Years Ended
	March 31, 2025		March 31, 2024		March 31, 2023
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	92,600	$	93,350	$	69,595
Operating cash flows from finance leases		5,259		2,074		2,449
Financing cash flows from finance leases		15,176		11,941		11,572

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	94,350	$	29,035	$	9,817
Finance leases		145,625		1,946		2,232

The following table presents maturities of the Company’s lease liabilities as of March 31, 2025:


	Operating Leases		Finance Leases
	(In thousands)
Expected for fiscal year 2026	$	86,165	$	31,684
Expected for fiscal year 2027		82,683		22,631
Expected for fiscal year 2028		76,541		19,630
Expected for fiscal year 2029		73,723		19,614
Expected for fiscal year 2030		67,864		19,625
Thereafter		239,815		182,340
Total future lease payments required		626,791		295,524
Less: interest		147,348		137,051
Total	$	479,443	$	158,473

As of March 31, 2025, the Company had $76.9 million of additional lease commitments that will commence subsequent to fiscal year 2025, with lease terms of five to 17 years.