Quarterly report pursuant to Section 13 or 15(d)

Leases

v3.19.2
Leases
6 Months Ended
Jun. 30, 2019
Leases [Abstract]  
Leases  Leases
We adopted ASU 2016-02 effective January 1, 2019 using the modified retrospective approach. Prior period amounts have not been adjusted and continue to be reported in accordance with our historic accounting under ASC Topic 840. Our leases are primarily comprised of real estate leases of office facilities and equipment under operating leases that expire on various dates through 2033. In May 2015, we entered into a lease agreement for office space located in Richardson, Texas to serve as our corporate headquarters and data center. The lease is for a term of twelve years, beginning in 2016, and includes optional extension periods. The lease agreement contains provisions for rent escalations over the term of the lease and leasehold improvement incentives.
The components of lease costs for the three and six months ended June 30, 2019 were as follows:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2019
 
(in thousands)
Operating lease cost
$
3,477

 
$
6,963

 
 
 
 
Finance lease cost:
 
 
 
Depreciation of finance lease asset
$
992

 
$
1,984

Interest on lease liabilities
1,061

 
2,106

Total finance lease cost
$
2,053

 
4,090


Rent expense for short-term leases for the three and six months ended June 30, 2019 was not material.
Supplemental balance sheet information related to leases at June 30, 2019, was as follows:
 
Operating leases
 
Finance leases
 
Total leases
 
(in thousands, except lease term and discount rate)
Right-of-use assets
$
42,896

 
$
56,226

 
$
99,122

 
 
 
 
 
 
Lease liabilities, current (1)
$
9,933

 
$
3,183

 
$
13,116

Lease liabilities, net of current portion
38,426

 
75,085

 
113,511

Total lease liabilities
$
48,359

 
$
78,268

 
$
126,627

 
 
 
 
 
 
Weighted average remaining term (in years)
5.9

 
14.2

 
 
Weighted average discount rate
5.2
%
 
5.4
%
 
 
(1) 
Included in the line “Accrued expenses and other current liabilities” in the accompanying Condensed Consolidated Balance Sheets.
Supplemental cash flow information related to leases for the six months ended June 30, 2019, was as follows, in thousands:
Cash payments for lease liabilities within operating activities:
 
Operating leases
$
7,809

Finance leases
$
2,106

Non-cash activity:
 
Right-of-use assets obtained in exchange for operating lease obligations
$
12,029


At June 30, 2019, future maturities of lease liabilities due under these lease agreements were as follows for the years ending December 31, in thousands:
 
Operating leases
 
Finance leases
 
Total leases
2019
$
6,483

 
$
3,059

 
$
9,542

2020
10,214

 
7,398

 
17,612

2021
8,983

 
7,504

 
16,487

2022
7,982

 
7,609

 
15,591

2023
7,590

 
7,714

 
15,304

Thereafter
15,161

 
80,033

 
95,194

Total undiscounted lease payments
56,413

 
113,317

 
169,730

Present value adjustment
(8,054
)
 
(35,049
)
 
(43,103
)
Present value of lease payments
$
48,359

 
$
78,268

 
$
126,627


Leases  Leases
We adopted ASU 2016-02 effective January 1, 2019 using the modified retrospective approach. Prior period amounts have not been adjusted and continue to be reported in accordance with our historic accounting under ASC Topic 840. Our leases are primarily comprised of real estate leases of office facilities and equipment under operating leases that expire on various dates through 2033. In May 2015, we entered into a lease agreement for office space located in Richardson, Texas to serve as our corporate headquarters and data center. The lease is for a term of twelve years, beginning in 2016, and includes optional extension periods. The lease agreement contains provisions for rent escalations over the term of the lease and leasehold improvement incentives.
The components of lease costs for the three and six months ended June 30, 2019 were as follows:
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2019
 
(in thousands)
Operating lease cost
$
3,477

 
$
6,963

 
 
 
 
Finance lease cost:
 
 
 
Depreciation of finance lease asset
$
992

 
$
1,984

Interest on lease liabilities
1,061

 
2,106

Total finance lease cost
$
2,053

 
4,090


Rent expense for short-term leases for the three and six months ended June 30, 2019 was not material.
Supplemental balance sheet information related to leases at June 30, 2019, was as follows:
 
Operating leases
 
Finance leases
 
Total leases
 
(in thousands, except lease term and discount rate)
Right-of-use assets
$
42,896

 
$
56,226

 
$
99,122

 
 
 
 
 
 
Lease liabilities, current (1)
$
9,933

 
$
3,183

 
$
13,116

Lease liabilities, net of current portion
38,426

 
75,085

 
113,511

Total lease liabilities
$
48,359

 
$
78,268

 
$
126,627

 
 
 
 
 
 
Weighted average remaining term (in years)
5.9

 
14.2

 
 
Weighted average discount rate
5.2
%
 
5.4
%
 
 
(1) 
Included in the line “Accrued expenses and other current liabilities” in the accompanying Condensed Consolidated Balance Sheets.
Supplemental cash flow information related to leases for the six months ended June 30, 2019, was as follows, in thousands:
Cash payments for lease liabilities within operating activities:
 
Operating leases
$
7,809

Finance leases
$
2,106

Non-cash activity:
 
Right-of-use assets obtained in exchange for operating lease obligations
$
12,029


At June 30, 2019, future maturities of lease liabilities due under these lease agreements were as follows for the years ending December 31, in thousands:
 
Operating leases
 
Finance leases
 
Total leases
2019
$
6,483

 
$
3,059

 
$
9,542

2020
10,214

 
7,398

 
17,612

2021
8,983

 
7,504

 
16,487

2022
7,982

 
7,609

 
15,591

2023
7,590

 
7,714

 
15,304

Thereafter
15,161

 
80,033

 
95,194

Total undiscounted lease payments
56,413

 
113,317

 
169,730

Present value adjustment
(8,054
)
 
(35,049
)
 
(43,103
)
Present value of lease payments
$
48,359

 
$
78,268

 
$
126,627