Leases

12 Months Ended

Dec. 31, 2025

7. Leases

The Company leases its manufacturing and distribution facilities, corporate offices, Purple showrooms and certain equipment under non-cancelable operating leases with various expiration dates through 2036. The Company’s office and manufacturing leases provide for initial lease terms up to 16 years, while Purple showrooms have initial lease terms of up to 10 years. Certain leases may contain options to extend the term of the original lease. The exercise of lease renewal options is at the Company’s discretion. Any lease renewal options are included in the lease term if exercise is reasonably certain at lease commencement. The Company also leases vehicles and other equipment under both operating and finance leases with initial lease terms of three to five years. The ROU asset for finance leases was $0.6 million and $1.0 million as of December 31, 2025 and 2024, respectively.

The following table presents the Company’s lease costs (in thousands):

	Years Ended December 31,
	2025		2024		2023
Operating lease costs	$	18,412	$	19,460	$	19,466
Variable lease costs		4,275		4,338		4,121
Short-term lease costs		264		—		—
Total lease costs	$	22,951	$	23,798	$	23,587

The table below reconciles the undiscounted cash flows for each of the first five years and total remaining years to the operating lease liabilities recorded on the consolidated balance sheet at December 31, 2025 (in thousands):

Year ended December 31,
2026	$	19,996
2027		20,195
2028		19,846
2029		17,024
2030		11,510
Thereafter		24,108
Total operating lease payments		112,679
Less – lease payments representing interest		(19,698	)
Present value of operating lease payments	$	92,981

As of December 31, 2025 and 2024, the weighted-average remaining term of operating leases was 6.3 years and 6.8 years, respectively, and the weighted-average discount rate was 6.79% and 6.09%, respectively, for operating leases recognized on the consolidated balance sheets.

The following table provides supplemental information related to the Company’s consolidated statement of cash flows (in thousands):

	Years Ended December 31,
	2025		2024		2023
Cash paid for amounts included in present value of operating lease liabilities ^(b)	$	22,319	$	23,033	$	20,817
ROU assets obtained in exchange for operating lease liabilities		7,305		8,516		8,435

(b)	– Operating cash flows paid for operating leases are included within the change in operating leases, net within the Consolidated Statements of Cash Flows offset by non-cash ROU asset amortization and lease liability accretion.