Leases

3 Months Ended

Mar. 31, 2024

Leases

Leases

7.Leases

Lessee Accounting

We enter into non-cancelable operating and finance leases for, among other things, communication towers, satellites, satellite-related ground infrastructure, data centers, office space, dark fiber and transport equipment, warehouses and distribution centers, vehicles and other equipment. Substantially all of our leases have remaining lease terms from one to 13 years, some of which include renewal options, and some of which include options to terminate the leases within one year. For certain arrangements (generally communication towers), the lease term includes the non-cancelable period plus the renewal period that we are reasonably certain to exercise.

Our Nimiq 5 satellite is accounted for as finance lease within our Pay-TV segment. Substantially all of our remaining leases are accounted for as operating leases, including our Anik F3 satellite lease.

The components of lease expense were as follows:

	For the Three Months Ended
	March 31,
	2024		2023
	(In thousands)
Operating lease cost (1)	$	160,794	$	111,433
Short-term lease cost (2)		2,928		2,718
Finance lease cost:
Amortization of right-of-use assets		13,945		27,056
Interest on lease liabilities		2,792		3,570
Total finance lease cost		16,737		30,626
Total lease costs	$	180,459	$	144,777

(1) The increase in operating lease cost is primarily related to communication tower leases.

(2) Leases that have terms of 12 months or less.

Supplemental cash flow information related to leases was as follows:
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	For the Three Months Ended
	March 31,
	2024		2023
	(In thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	112,238	$	67,223
Operating cash flows from finance leases	$	2,824	$	2,397
Financing cash flows from finance leases	$	15,134	$	8,713
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	199,300	$	231,868
Finance leases	$	—	$	51,110

Supplemental balance sheet information related to leases was as follows:

	As of
	March 31,		December 31,
	2024		2023
	(In thousands)
Operating Leases:
Operating lease assets	$	2,965,490	$	2,934,862
Other current liabilities	$	324,985	$	301,172
Operating lease liabilities		3,033,390		2,992,863
Total operating lease liabilities	$	3,358,375	$	3,294,035
Finance Leases:
Property and equipment, gross	$	465,549	$	465,549
Accumulated depreciation		(384,201)		(370,768)
Property and equipment, net	$	81,348	$	94,781
Other current liabilities	$	48,391	$	56,459
Other long-term liabilities		60,133		67,199
Total finance lease liabilities	$	108,524	$	123,658
Weighted Average Remaining Lease Term:
Operating leases		10.0 years		10.7 years
Finance leases		2.1 years		2.2 years
Weighted Average Discount Rate:
Operating leases		9.9%		9.5%
Finance leases		9.6%		9.7%

Maturities of lease liabilities as of March 31, 2024 were as follows:

	Maturities of Lease Liabilities
	Operating		Finance
For the Years Ending December 31,	Leases		Leases		Total
	(In thousands)
2024 (remaining nine months)	$	332,186	$	48,115	$	380,301
2025		476,917		35,392		512,309
2026		510,430		36,588		547,018
2027		511,954		2,574		514,528
2028		470,151		—		470,151
Thereafter		3,165,185		—		3,165,185
Total lease payments		5,466,823		122,669		5,589,492
Less: Imputed interest		(2,108,448)		(14,145)		(2,122,593)
Total		3,358,375		108,524		3,466,899
Less: Current portion		(324,985)		(48,391)		(373,376)
Long-term portion of lease obligations	$	3,033,390	$	60,133	$	3,093,523