Annual report [Section 13 and 15(d), not S-K Item 405]

Leases

v3.25.4
Leases
 12 Months Ended
Dec. 31, 2025
Leases [Abstract]  
Leases
Note J – Leases
The Company has entered into and acquired long-term leasing arrangements for the right to use various classes of underlying assets, including facilities, vehicles and office equipment. Certain facility leases contain predetermined fixed escalation of minimum rents at stated rates ranging from 1.00% to 25.00% per annum and three leases with annual escalations based on certain price indices. In addition, certain facility leases include renewal options that could extend the lease term for up to an additional fifteen years. The office equipment lease contains a renewal option that could extend the lease to consecutive 60-day terms and a purchase option.

Total Lease Costs
The following table summarizes total lease costs for the period:
Year Ended
December 31, 2025 December 31, 2024 December 31, 2023
Finance lease cost:
Amortization of ROU assets $ 576  $ 518  $ 434 
Interest on lease liabilities 118  122  $ 98 
Operating lease costs 8,343  4,637  $ 4,251 
Variable lease costs 66  48  $ 29 
Short-term lease costs 638  475  $ 230 
Total lease costs $ 9,741  $ 5,800  $ 5,042 
Total lease costs are included in selling, general and administrative expenses and cost of sales on the consolidated statements of operations and comprehensive income (loss).

During the year ended December 31, 2025, the Company abandoned a leased facility and recognized impairment expense of $0.3 million related to ROU assets. There was no impairment recognized related to ROU assets during the years ended December 31, 2024 and 2023.

As of December 31, 2025, the Company had one facility lease that had not yet commenced but requires significant future lease obligations in the amount of $12.3 million. The contract was determined to be an operating lease, whereby the Company is not required to make rent payments prior to the lease commencement date while construction is completed on the underlying asset. Due to the nature of the work and the amount of the Company’s contribution to the construction period costs for the lease, the Company was determined not to be the owner of the assets under construction as the landlord has substantially all of the construction period risks.
Supplemental Balance Sheet Information
The following table presents supplemental balance sheet information related to the Company’s operating and finance leases:
December 31, 2025 December 31, 2024
Operating Leases Finance Leases Operating Leases Finance Leases
Right-of-use assets, net reflected in the following balance sheet line items:
Property, plant and equipment, net
$ —  $ 1,786  $ —  $ 1,392 
Right-of-use assets 31,741  —  15,277  — 
Total right-of-use assets
 $ 31,741  $ 1,786  $ 15,277  $ 1,392 
Current lease balance reflected in the following balance sheet line items:
Short-term operating lease liabilities $ 4,088  $ —  $ 4,354  $ — 
Short-term finance lease liabilities —  595  —  473 
Non-current lease balance reflected in the following balance sheet line items:
Long-term operating lease liabilities 30,471  —  13,444  — 
Long-term finance lease liabilities —  1,276  —  980 
Total lease liabilities $ 34,559  $ 1,871  $ 17,798  $ 1,453 

Other Supplemental Information
The following table presents other supplemental information related to the Company’s leases:
Year Ended
December 31, 2025 December 31, 2024 December 31, 2023
Operating Leases Finance Leases Operating Leases Finance Leases Operating Leases Finance Leases
Cash paid for lease liabilities $ 8,543  $ 690  $ 2,460  $ 601  $ 4,273  $ 492 
ROU assets obtained in exchange for new lease liabilities $ 7,330  $ 774  $ 5,813  $ 457  $ 3,418  $ 1,167 
Weighted average remaining lease term (in years) 5.4 3.4 4.0 3.3 4.4 3.8
Weighted average discount rate 8.9  % 7.9  % 7.8  % 8.1  % 6.3  % 8.4  %

Future Lease Obligations
As of December 31, 2025, the future annual minimum lease payments for lease liabilities are as follows:
Year Operating Leases Finance Leases
2026 $ 7,052  $ 716 
2027 8,120  624 
2028 6,419  429 
2029 5,265  237 
2030 5,478  124 
Thereafter
 16,872  — 
Total lease payments
 49,206  2,130 
Less: imputed interest 14,647  259 
Present value of lease liabilities
 $ 34,559  $ 1,871 
Leases
Note J – Leases
The Company has entered into and acquired long-term leasing arrangements for the right to use various classes of underlying assets, including facilities, vehicles and office equipment. Certain facility leases contain predetermined fixed escalation of minimum rents at stated rates ranging from 1.00% to 25.00% per annum and three leases with annual escalations based on certain price indices. In addition, certain facility leases include renewal options that could extend the lease term for up to an additional fifteen years. The office equipment lease contains a renewal option that could extend the lease to consecutive 60-day terms and a purchase option.

Total Lease Costs
The following table summarizes total lease costs for the period:
Year Ended
December 31, 2025 December 31, 2024 December 31, 2023
Finance lease cost:
Amortization of ROU assets $ 576  $ 518  $ 434 
Interest on lease liabilities 118  122  $ 98 
Operating lease costs 8,343  4,637  $ 4,251 
Variable lease costs 66  48  $ 29 
Short-term lease costs 638  475  $ 230 
Total lease costs $ 9,741  $ 5,800  $ 5,042 
Total lease costs are included in selling, general and administrative expenses and cost of sales on the consolidated statements of operations and comprehensive income (loss).

During the year ended December 31, 2025, the Company abandoned a leased facility and recognized impairment expense of $0.3 million related to ROU assets. There was no impairment recognized related to ROU assets during the years ended December 31, 2024 and 2023.

As of December 31, 2025, the Company had one facility lease that had not yet commenced but requires significant future lease obligations in the amount of $12.3 million. The contract was determined to be an operating lease, whereby the Company is not required to make rent payments prior to the lease commencement date while construction is completed on the underlying asset. Due to the nature of the work and the amount of the Company’s contribution to the construction period costs for the lease, the Company was determined not to be the owner of the assets under construction as the landlord has substantially all of the construction period risks.
Supplemental Balance Sheet Information
The following table presents supplemental balance sheet information related to the Company’s operating and finance leases:
December 31, 2025 December 31, 2024
Operating Leases Finance Leases Operating Leases Finance Leases
Right-of-use assets, net reflected in the following balance sheet line items:
Property, plant and equipment, net
$ —  $ 1,786  $ —  $ 1,392 
Right-of-use assets 31,741  —  15,277  — 
Total right-of-use assets
 $ 31,741  $ 1,786  $ 15,277  $ 1,392 
Current lease balance reflected in the following balance sheet line items:
Short-term operating lease liabilities $ 4,088  $ —  $ 4,354  $ — 
Short-term finance lease liabilities —  595  —  473 
Non-current lease balance reflected in the following balance sheet line items:
Long-term operating lease liabilities 30,471  —  13,444  — 
Long-term finance lease liabilities —  1,276  —  980 
Total lease liabilities $ 34,559  $ 1,871  $ 17,798  $ 1,453 

Other Supplemental Information
The following table presents other supplemental information related to the Company’s leases:
Year Ended
December 31, 2025 December 31, 2024 December 31, 2023
Operating Leases Finance Leases Operating Leases Finance Leases Operating Leases Finance Leases
Cash paid for lease liabilities $ 8,543  $ 690  $ 2,460  $ 601  $ 4,273  $ 492 
ROU assets obtained in exchange for new lease liabilities $ 7,330  $ 774  $ 5,813  $ 457  $ 3,418  $ 1,167 
Weighted average remaining lease term (in years) 5.4 3.4 4.0 3.3 4.4 3.8
Weighted average discount rate 8.9  % 7.9  % 7.8  % 8.1  % 6.3  % 8.4  %

Future Lease Obligations
As of December 31, 2025, the future annual minimum lease payments for lease liabilities are as follows:
Year Operating Leases Finance Leases
2026 $ 7,052  $ 716 
2027 8,120  624 
2028 6,419  429 
2029 5,265  237 
2030 5,478  124 
Thereafter
 16,872  — 
Total lease payments
 49,206  2,130 
Less: imputed interest 14,647  259 
Present value of lease liabilities
 $ 34,559  $ 1,871