v3.26.3
Leases
 9 Months Ended
Sep. 30, 2026
Leases [Abstract]  
Leases Leases
Finance Leases

The Company generally enters into finance lease arrangements to obtain hard drives and other infrastructure equipment for its data center operations. The terms of these agreements generally range from three to five years and certain of these arrangements have optional renewals to extend the term of the lease generally at a fixed price. Finance leases are generally secured by the underlying leased equipment. The Company’s finance leases have original lease periods expiring between 2026 and 2031. Finance lease right-of-use assets are included in property and equipment, net in the Company’s condensed consolidated balance sheets.
Operating Leases
The Company leases data center spaces and office space under non-cancelable operating leases with various expiration dates. Certain lease agreements include renewal options to extend the lease term at a price to be determined upon exercise. These options are not reasonably certain to be exercised and therefore are not factored in the determination of lease payments. Contingent rental payments are generally not included in the Company’s lease agreements. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company's leases have original lease periods expiring between 2027 and 2033.

In May 2025, the Company entered into an agreement to sublease approximately 12,000 square feet on the second floor of its former corporate headquarters in San Mateo, California. That sublease commenced in June 2025 and expires in March 2029. In August 2026, the Company entered into an agreement to sublease approximately 12,000 square feet on the first floor of the same facility. The first-floor sublease is expected to commence in November 2026 and is scheduled to expire in March 2029. The Company classifies both subleases as operating leases and recognizes fixed sublease income on a straight-line basis over their respective terms and variable reimbursements as the related costs are incurred. Sublease income is recorded as a reduction of operating lease expense in the condensed consolidated statements of operations and comprehensive loss.
Summary of Lease Information
The weighted average remaining lease terms and discount rates as of September 30, 2026 and December 31, 2025 were as follows:

September 30, 2026December 31, 2025
Operating leases
Finance Leases(1)
Operating leases
Finance Leases(1)
Remaining lease term5.1 years3.2 years5.4 years2.5 years
Discount rate6.8 %12.5 %6.9 %12.6 %
________________
(1) Includes lease financing obligations.
The following table presents the components of lease expense (in thousands):

Three Months Ended September 30,Nine Months Ended September 30,
2026202520262025
Finance lease costs
Depreciation expense(1)
$2,833 $2,033 $7,642 $6,879 
Interest expense$1,659 $792 $3,930 $2,325 
Lease financing obligation costs
Depreciation expense(1)
$212 $246 $638 $1,088 
Interest expense$2 $39 $23 $211 
Operating lease costs
Rental expense related to lease components$2,356 $1,779 $6,264 $4,248 
Rental expense related to non-lease components(2)
1,022 914 3,130 3,140 
Variable lease costs1,255 1,240 3,369 3,557 
Total operating lease costs$4,633 $3,933 $12,763 $10,945 
Total included in cost of revenue$4,603 $3,730 $12,647 $10,275 
Total included in general and administrative expense$30 $203 $116 $670 
________________
(1) Substantially all of the depreciation expense on assets acquired through the Company’s finance leases and lease financing obligations is included in cost of revenue in its condensed consolidated statements of operations and comprehensive loss.
(2) Non-lease components represent non-tangible utilities and services associated with the Company’s co-location lease agreements and are not recorded on the Company’s condensed consolidated balance sheets. The Company used judgment and third-party data in determining the stand-alone price for allocating consideration to lease and non-lease components under these lease agreements, such as the price of utilities as compared to its tangible data center footprint within each facility.
The following table presents supplemental cash flow information relating to the Company’s leases (in thousands):

Nine Months Ended September 30,
20262025
Operating cash flows
Cash paid for interest on finance lease and lease financing obligations$3,953 $2,626 
Cash paid for operating lease liabilities$5,775 $4,144 
Non-cash items
Equipment acquired through finance leases$29,095 $19,901 
Right-of-use assets obtained in exchange for operating lease obligations$19,595 $12,469 
The future minimum commitments for finance leases and lease financing obligations as of September 30, 2026 were as follows (in thousands):

Year Ending December 31,Finance leasesLease financing obligationsTotal
Remainder of 2026
$6,130 $43 $6,173 
202722,028 — 22,028 
202814,192 — 14,192 
202912,826 — 12,826 
20306,908 — 6,908 
Thereafter1,522 — 1,522 
Total future minimum lease and financing commitments63,606 43 63,649 
Less imputed interest(11,494)— (11,494)
Total finance lease and lease financing obligation liabilities$52,112 $43 $52,155 
As of September 30, 2026, the Company's future minimum obligations for operating leases and non-cancelable contractual commitments related to non-lease components were as follows (in thousands):

Year Ending December 31,Operating leasesNon-lease componentsTotal
Remainder of 2026
$2,531 $1,072 $3,603 
20279,657 4,318 13,975 
20289,927 3,904 13,831 
20297,882 2,548 10,430 
20306,183 1,352 7,535 
Thereafter12,713 109 12,822 
Total future minimum operating lease and non-lease commitments48,893 $13,303 $62,196 
Less imputed interest(8,255)
Total liability$40,638 

Leases Not Yet Commenced

In July 2026, the Company entered into an agreement to expand its lease for a data center facility, which is expected to commence in the fourth quarter of 2026, with a non-cancelable lease term of three years. The undiscounted future lease payments for this lease are approximately €1.4 million, or approximately $1.5 million based on the exchange rate between the Euro and the U.S. dollar as of September 30, 2026.
Leases Leases
Finance Leases

The Company generally enters into finance lease arrangements to obtain hard drives and other infrastructure equipment for its data center operations. The terms of these agreements generally range from three to five years and certain of these arrangements have optional renewals to extend the term of the lease generally at a fixed price. Finance leases are generally secured by the underlying leased equipment. The Company’s finance leases have original lease periods expiring between 2026 and 2031. Finance lease right-of-use assets are included in property and equipment, net in the Company’s condensed consolidated balance sheets.
Operating Leases
The Company leases data center spaces and office space under non-cancelable operating leases with various expiration dates. Certain lease agreements include renewal options to extend the lease term at a price to be determined upon exercise. These options are not reasonably certain to be exercised and therefore are not factored in the determination of lease payments. Contingent rental payments are generally not included in the Company’s lease agreements. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company's leases have original lease periods expiring between 2027 and 2033.

In May 2025, the Company entered into an agreement to sublease approximately 12,000 square feet on the second floor of its former corporate headquarters in San Mateo, California. That sublease commenced in June 2025 and expires in March 2029. In August 2026, the Company entered into an agreement to sublease approximately 12,000 square feet on the first floor of the same facility. The first-floor sublease is expected to commence in November 2026 and is scheduled to expire in March 2029. The Company classifies both subleases as operating leases and recognizes fixed sublease income on a straight-line basis over their respective terms and variable reimbursements as the related costs are incurred. Sublease income is recorded as a reduction of operating lease expense in the condensed consolidated statements of operations and comprehensive loss.
Summary of Lease Information
The weighted average remaining lease terms and discount rates as of September 30, 2026 and December 31, 2025 were as follows:

September 30, 2026December 31, 2025
Operating leases
Finance Leases(1)
Operating leases
Finance Leases(1)
Remaining lease term5.1 years3.2 years5.4 years2.5 years
Discount rate6.8 %12.5 %6.9 %12.6 %
________________
(1) Includes lease financing obligations.
The following table presents the components of lease expense (in thousands):

Three Months Ended September 30,Nine Months Ended September 30,
2026202520262025
Finance lease costs
Depreciation expense(1)
$2,833 $2,033 $7,642 $6,879 
Interest expense$1,659 $792 $3,930 $2,325 
Lease financing obligation costs
Depreciation expense(1)
$212 $246 $638 $1,088 
Interest expense$2 $39 $23 $211 
Operating lease costs
Rental expense related to lease components$2,356 $1,779 $6,264 $4,248 
Rental expense related to non-lease components(2)
1,022 914 3,130 3,140 
Variable lease costs1,255 1,240 3,369 3,557 
Total operating lease costs$4,633 $3,933 $12,763 $10,945 
Total included in cost of revenue$4,603 $3,730 $12,647 $10,275 
Total included in general and administrative expense$30 $203 $116 $670 
________________
(1) Substantially all of the depreciation expense on assets acquired through the Company’s finance leases and lease financing obligations is included in cost of revenue in its condensed consolidated statements of operations and comprehensive loss.
(2) Non-lease components represent non-tangible utilities and services associated with the Company’s co-location lease agreements and are not recorded on the Company’s condensed consolidated balance sheets. The Company used judgment and third-party data in determining the stand-alone price for allocating consideration to lease and non-lease components under these lease agreements, such as the price of utilities as compared to its tangible data center footprint within each facility.
The following table presents supplemental cash flow information relating to the Company’s leases (in thousands):

Nine Months Ended September 30,
20262025
Operating cash flows
Cash paid for interest on finance lease and lease financing obligations$3,953 $2,626 
Cash paid for operating lease liabilities$5,775 $4,144 
Non-cash items
Equipment acquired through finance leases$29,095 $19,901 
Right-of-use assets obtained in exchange for operating lease obligations$19,595 $12,469 
The future minimum commitments for finance leases and lease financing obligations as of September 30, 2026 were as follows (in thousands):

Year Ending December 31,Finance leasesLease financing obligationsTotal
Remainder of 2026
$6,130 $43 $6,173 
202722,028 — 22,028 
202814,192 — 14,192 
202912,826 — 12,826 
20306,908 — 6,908 
Thereafter1,522 — 1,522 
Total future minimum lease and financing commitments63,606 43 63,649 
Less imputed interest(11,494)— (11,494)
Total finance lease and lease financing obligation liabilities$52,112 $43 $52,155 
As of September 30, 2026, the Company's future minimum obligations for operating leases and non-cancelable contractual commitments related to non-lease components were as follows (in thousands):

Year Ending December 31,Operating leasesNon-lease componentsTotal
Remainder of 2026
$2,531 $1,072 $3,603 
20279,657 4,318 13,975 
20289,927 3,904 13,831 
20297,882 2,548 10,430 
20306,183 1,352 7,535 
Thereafter12,713 109 12,822 
Total future minimum operating lease and non-lease commitments48,893 $13,303 $62,196 
Less imputed interest(8,255)
Total liability$40,638 

Leases Not Yet Commenced

In July 2026, the Company entered into an agreement to expand its lease for a data center facility, which is expected to commence in the fourth quarter of 2026, with a non-cancelable lease term of three years. The undiscounted future lease payments for this lease are approximately €1.4 million, or approximately $1.5 million based on the exchange rate between the Euro and the U.S. dollar as of September 30, 2026.