Leases

6 Months Ended

Jun. 30, 2023

Note 5 — Leases

All of the Company’s leases are operating leases, the majority of which are for office space. Operating lease right-of-use (“ROU”) assets and non-current operating lease liabilities are included as individual line items in the Consolidated Balance Sheets, while short-term operating lease liabilities are recorded within accrued expenses and other current liabilities. Leases with an initial term of twelve months or less are not recorded in the Consolidated Balance Sheets and are not material.

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


	For the Three Months Ended June 30,
	2023			2022
Operating lease cost	$	3,240		$	3,600
Short-term lease cost		257			175
Variable lease cost		1,072			1,463
Sublease income		(130	)		(192	)
Total lease cost	$	4,439		$	5,046


	For the Six Months Ended June 30,
	2023			2022
Operating lease cost	$	6,554		$	7,252
Short-term lease cost		518			312
Variable lease cost		1,857			3,013
Sublease income		(261	)		(383	)
Total lease cost	$	8,668		$	10,194

Additional lease information is summarized in the following table (in thousands, except lease term and discount rate):


	For the Six Months Ended June 30,
	2023			2022
Cash paid for amounts included in the measurement of operating lease liabilities	$	6,820		$	6,180
Operating lease ROU assets obtained in exchange for lease obligations	$	1,110		$	172
Weighted-average remaining lease term - operating leases (years)		4.7			5.5
Weighted-average discount rate - operating leases		4.3	%		4.3	%

Future minimum lease payments under non-cancelable leases and estimated future sublease cash receipts from non-cancelable arrangements as of June 30, 2023 are as follows (in thousands):


	Operating Lease			Sublease
	Payments			Cash Receipts
2023 (remainder)	$	8,133		$	307
2024		16,184			624
2025		13,920			—
2026		12,336			—
2027		5,713			—
Thereafter		8,913			—
Total lease payments and estimated sublease cash receipts		65,199		$	931
Less imputed interest		(6,225	)
Present value of lease liabilities	$	58,974

Lease balances as of June 30, 2023 are as follows (in thousands):


Operating lease ROU assets	$	44,649

Short-term operating lease liabilities (1)	$	14,143
Non-current operating lease liabilities		44,831
Total operating lease liabilities	$	58,974

(1)

Included in accrued expenses and other current liabilities in the Consolidated Balance Sheets.

The Company’s leases do not contain residual value guarantees, material restrictions, or covenants.

During the six months ended June 30, 2023, the Company recorded ROU asset impairments of $0.8 million related to closing one floor of its offices located in San Francisco and one other smaller office location. The impairments are included in restructuring and related costs in the Consolidated Statements of Operations. As a result of the impairments, the ROU assets were required to be recorded at their estimated fair values as Level 3 non-financial assets. The fair values of the asset groups were determined using a discounted cash flow model, which required the use of estimates, including projected cash flows for the related assets, the selection of a discount rate used in the model, and regional real estate industry data.