Leases

12 Months Ended

Dec. 31, 2022

Leases

Leases

Note 6   Leases

The Company adopted ASU No. 2016-02 “Leases (Topic 842)” on January 1, 2022, resulting in the recognition of right-of-use assets of $9.1 million and lease liabilities of $9.5 million. The Company enters into leases for office space and data centers.  A number of the leases include one or more options to renew the lease terms or not terminate the lease. The exercise of these options is at the Company’s discretion and is therefore recognized on the balance sheet when it is reasonably certain the Company will exercise such options. As the Company’s leases typically do not contain a readily determinable implicit rate, the Company determines the present value of the lease liability using its incremental borrowing rate at the lease commencement date.

All of the Company’s leases are considered operating leases. The Company had no finance leases as of and for the year ended December 31, 2022.

As of December 31, 2022, the Company’s right-of use assets and liabilities for operating leases were as follows:

Right-of-use asset, net	$	6,732
Current portion of lease liabilities	$	4,030
Lease liabilities, net of current portion		2,959
	$	6,989

Lease commitments as of December 31, 2022 were as follows:

Year Ending December 31,	Amount
2023	$	4,244
2024		2,176
2025		882
Total lease commitments	$	7,302
Less: Interest		(313)
Present value of lease liabilities	$	6,989

The components of the Company’s operating lease cost for the twelve months ended December 31, 2022 were as follows:

Operating lease cost		5,053
Variable lease cost		828
Total lease cost	$	5,881

Variable lease costs are comprised of costs, such as the Company’s proportionate share of actual costs for utilities, common area maintenance, property taxes and insurance, that are not included in the lease liability and are recognized in the period in which they are incurred.

As of December 31, 2022, the weighted-average remaining lease term for operating leases was 1.84 years and the weighted-average discount rate for operating leases was 4.43%. 

The Company had entered into operating leases for international office spaces and data centers that were yet to commence as of December 31, 2022.

Supplemental Cash Flow Information
Cash paid for amounts included in the measurement of lease liabilities	5,111
Right-of-use assets obtained in exchange for lease liabilities	9,514

Future aggregate minimum rental payments under the noncancelable operating leases and service agreements as of December 31, 2021, prior to the Company’s adoption of the new lease standard, were as follows:

			Service
Years Ending December 31,	Operating Leases		Agreements		Total
2022	$	4,384	$	470	$	4,854
2023		3,291		19		3,310
2024		2,385		—		2,385
2025		901		—		901
Total	$	10,961	$	489	$	11,450

Under Accounting Standards Codification 840, the previous lease standard, total expense for lease arrangements was $3.9 million and $3.7 million for the years ended December 31, 2021 and 2020, respectively, and is included in Cost of revenues and Operating expenses. Total expense related to the service agreements was $1.1 million and $841 thousand for the years ended December 31, 2021 and 2020, respectively, and is included in Cost of revenues.