Leases

12 Months Ended

Dec. 31, 2025

Note 17.Leases

The Group has historically entered into a number of lease arrangements under which it is the lessee. As at December 31, 2025, the SEALSQ Group holds six operating leases which relate to premises.

We do not sublease. All our operating leases include multiple optional renewal periods which are not reasonably certain to be exercised.

During the year ended December 31, 2025, the Group completed few sale and leaseback transactions involving IT equipment. Each transaction met the criteria for a sale under ASC 606, and accordingly, the Group derecognized the assets sold and recognized a right- of-use asset and lease liability in accordance with ASC 842. The leaseback arrangement is classified as a finance lease. The Company holds five such finance leases which relate to IT equipment.

During the years 2025, 2024 and 2023 we recognized rent expenses associated with our leases as follows:


		12 months ended		12 months ended		12 months ended
		December 31,		December 31,		December 31,
USD’000		2025		2024		2023
Finance lease cost:
Amortization of right-of-use assets		37		—		—
Interest on lease liabilities		2		—		—

Operating lease cost:
Fixed rent expense		540		356		329
Variable lease cost		72		—		—
Short-term lease cost		—		—		—
Net lease cost		651		356		329
Lease cost - Cost of sales		—		—		—
Lease cost - General & administrative expenses		651		356		329
Net lease cost		651		356		329

In the years 2025 and 2024, we had the following cash and non-cash activities associated with our leases:


		As at December 31,		As at December 31,
USD’000		2025		2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases		589		351
Financing cash flows from finance leases		39		—
Non-cash investing and financing activities:
Net lease cost		651		356
Additions to ROU assets obtained from:
New operating lease liabilities		6,312		62
New finance lease liabilities		157		—

The following table provides the details of right-of-use assets and lease liabilities as of December 31, 2025:


		As at December 31,		As at December 31,
USD’000		2025		2024
Right-of-use assets:
Operating leases		6,113		1,031
Finance leases		126		—
Total right-of-use assets		6,239		1,031
Lease liabilities:
Operating leases		6,191		943
Finance leases		129		—
Total lease liabilities		6,320		943

As at December 31, 2025, future minimum annual lease payments were as follows:


Year (USD’000)		Operating		Finance		Total
2026		915		60		975
2027		887		45		932
2028		880		29		909
2029		879		1		880
2030 and beyond		3,699		—		3,699
Total future minimum operating and finance lease payments		7,260		135		7,395
Less effects of discounting		(1,069)		(6)		(1,075)
Lease liabilities recognized		6,191		129		6,320

As of December 31, 2025 the weighted-average remaining lease term was 8.16 years for operating leases and 2.47 years for finance leases.

As leases do not provide an implicit rate, we calculated an estimate rate based upon the estimated incremental borrowing rate of the Group. The weighted average discount rate associated with operating lease as of December 31, 2025 was 3.78%. The weighted average discount rate associated with finance lease as of December 31, 2025 was 3.37%.