Leases

9 Months Ended

Jul. 02, 2023

Leases [Abstract]

Leases

Leases

Our operating leases are primarily for corporate and project office spaces. To a much lesser extent, we have operating leases for vehicles and equipment. Our operating leases have remaining lease terms of one month to ten years, some of which may include options to extend the leases for up to five years.

We determine if an arrangement is a lease at inception. Operating leases are included in "Right-of-use assets, operating leases", "Short-term lease liabilities, operating leases" and "Long-term lease liabilities, operating leases" in the consolidated balance sheets. Our finance leases are immaterial.

Right-of-use ("ROU") assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of our leases do not provide an implicit rate, incremental borrowing rates are used based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU asset at the commencement date also includes any lease payments made to the lessor at or before the commencement date and initial direct costs less lease incentives received. Lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

The components of lease costs are as follows (in thousands):

	Three Months Ended				Nine Months Ended
	July 2, 2023		July 3, 2022		July 2, 2023		July 3, 2022
Operating lease cost	$	24,775	$	21,004	$	70,155	$	64,015
Sublease (income) cost	(46)		140		(125)		(116)
Total lease cost	$	24,729	$	21,144	$	70,030	$	63,899

Supplemental cash flow information related to leases is as follows (in thousands):

	Nine Months Ended
	July 2, 2023		July 3, 2022
Operating cash flows for operating leases	$	57,871	$	50,965
Right-of-use assets obtained in exchange for new operating lease liabilities	72,294		32,175

Supplemental balance sheet and other information related to leases are as follows (in thousands):

	Balance at
	July 2, 2023			October 2, 2022
Operating leases:
Right-of-use assets	$	207,218		$	182,319
Lease liabilities:
Current	68,555			57,865
Non-current	163,919			146,285
Total operating lease liabilities	$	232,474		$	204,150
Weighted-average remaining lease term:
Operating leases	5 years			5 years
Weighted-average discount rate:
Operating leases	3.0		%	2.2		%

At July 2, 2023, we have no material operating leases that have not yet commenced.

A maturity analysis of the future undiscounted cash flows associated with our lease liabilities at July 2, 2023 is as follows (in thousands):

	Operating Leases
2023 (remaining)	$	20,727
2024	69,302
2025	53,634
2026	36,291
2027	25,689
Beyond	45,624
Total lease payments	251,267
Less: imputed interest	(18,793)
Total present value of lease liabilities	$	232,474