8. LEASES

Lease as Lessee

The Company leases for data center capacity, cloud infrastructure, office space and general and administrative purposes under non-cancelable lease arrangements. These leases, including a data center lease acquired as part of the Enovum acquisition in 2024, generally have terms ranging from approximately 2 to 22 years and may include renewal options, purchase options, or both, depending on the nature of the underlying asset. Certain leases include variable payments based on usage, particularly for cloud services. Variable lease costs are recognized as incurred and are not included in the measurement of the right-of-use assets or lease liabilities.

On April 11, 2025, the Company entered into a 20-year data center lease agreement in Saint-Jérôme for its data center colocation services, with two five-year extension options and a fixed-price purchase option exercisable until December 31, 2025. In December 2025, the Company became reasonably certain to exercise the purchase option and remeasured the lease as a finance lease as of December 1, 2025. As a result of the remeasurement of the lease liability, there was a reduction of approximately $23.5 million to the lease right-of-use assets and lease liabilities. On December 31, 2025, the Company notified the lessor of its intent to exercise the purchase option. The option was exercised on January 14, 2026 and the purchase of MTL-3 was closed on May 8, 2026. During the first quarter of 2026, the Company remeasured its finance lease liability and right-of-use asset due to a change in the expected closing date of the underlying purchase. No cash was exchanged in this transaction. In the second quarter, upon the purchase of MTL-3, the Company derecognized the finance lease liability of $12.4 million and the right-of-use asset of $12.6 million. The acquired land, building and related improvements were recognized within property, plant and equipment. Refer to Note 9. Property, Plant and Equipment, Net for further details on this transaction.

During the three months ended September 30, 2026, the Company commenced new operating lease arrangements primarily related to data center facilities in France, Australia, and Canada. These arrangements resulted in the recognition of approximately $54.5 million of operating lease right-of-use assets and corresponding lease liabilities. These leases have initial terms of approximately five years and optional extension periods ranging from one to two years.

As of September 30, 2026 and December 31, 2025, right-of-use asset and lease liabilities consisted of the following:

Operating right-of-use assets are recorded net of accumulated amortization of $14.3 million and $7.7 million as of September 30, 2026 and December 31, 2025, respectively.

Finance lease right-of-use asset is recorded net of accumulated amortization of $0.1 million as of December 31, 2025. There was no finance lease right-of use asset as of September 30, 2026.

For the three months ended September 30, 2026 and 2025, the Company’s amortization on the operating lease right-of-use assets totaled $3.3 million and $1.4 million, respectively.

For the nine months ended September 30, 2026 and 2025, the Company’s amortization on the operating lease right-of-use assets totaled $6.5 million and $3.9 million, respectively.

For the three months ended September 30, 2026 and 2025, there was no finance lease interest expense or amortization expense, respectively.

For the nine months ended September 30, 2026, the Company’s interest expense and amortization on the finance lease was $0.4 million. For the nine months ended September 30, 2025, there was no finance lease interest expense or amortization expense.

The following table presents the components of the Company’s lease expense. GPU lease expenses and data center lease expenses related to operational data centers are included in cost of revenue; data center lease expenses incurred during construction and office lease expenses are included in general and administrative expenses:

The Company entered into a GPU server lease agreement effective January 2024 for its cloud services designed to support generative AI workstreams. The lease payment depends on the usage of the GPU servers and the Company concludes that the lease payments are variable and will be recognized when they are incurred. For the three months ended September 30, 2026 and 2025, the GPU server lease expense amounted to $2.9 million and $3.5 million, respectively and for the nine months ended September 30, 2026 and 2025, the GPU server lease expense amounted to $12.2 million and $11.0 million, respectively. These balances are included in Operating lease costs in the table above.

Additional information regarding the Company’s leasing activities as a lessee is as follows:

The following table represents our future minimum operating lease payments as of September 30, 2026:

Leases Not Yet Commenced

In July 2026, the Company entered into an agreement with a data center provider for colocation services at a data center facility in Canada. The agreement provides for 2.7 megawatts of critical IT capacity for an initial term of 60 months, with fixed monthly payments of $0.6 million representing aggregate fixed contractual payments of approximately $34.0 million, excluding variable electricity charges and additional services. In connection with the agreement, the Company paid a deposit of approximately $10.2 million, which is expected to be applied against future monthly payments or refunded under certain circumstances. As of September 30, 2026, the facility had not been made available for the Company’s use, and the lease had not commenced. Accordingly, no right-of-use asset or lease liability related to the arrangement was recognized as of September 30, 2026. The deposit was included in other noncurrent assets in the accompanying condensed consolidated balance sheets.

Lease as Lessor

The Company enters into lease arrangements for data storage and cloud service equipment, as well as dedicated data center capacity and related colocation services. These arrangements generally have lease terms ranging from approximately two to ten years.

Sales-Type Leases

Lease income from sales-type leases is primarily recognized as interest income over the lease term. The Company’s exposure to credit risk is limited to net investment in leases. 

The components of lease income for the sales-type lease were as follows:

Interest income is included in the condensed consolidated statements of operations under the caption “Revenue – Other”.

The components of net investment in sales-type leases were as follows:

In the second quarter of 2026, the Company terminated an existing sales-type lease with a customer, derecognizing $1.4 million of net investment in lease and reclassifying the underlying assets to property, plant, and equipment at their carrying value. The Company then entered into a new sales-type lease with a different customer, derecognizing those assets from property, plant, and equipment and recognizing a $0.7 million net investment in lease. This transaction resulted in a $0.3 million profit, recorded as “Other income” on the condensed consolidated statement of operations. In the third quarter of 2026, the Company entered into another sales-type lease with the same customer under the same structure, recognizing a $0.7 million net investment in lease and a $0.4 million profit, also recorded as “Other income” (see Note 9. Property, plant and equipment,net for further details).

The following table illustrates the Company’s future minimum receipts for sales-type lease as of September 30, 2026:

The present value of minimum sales-type receipts of $10.4 million is included in the condensed consolidated balance sheets under the caption “Net investment in lease”.

Operating Lease Income

The Company enters into operating lease arrangements to provide dedicated data center capacity and related colocation services to customers. Operating lease income from fixed lease payments and fixed nonrecurring charges allocated to lease components, is recognized on a straight-line basis over the respective lease terms, commencing when the underlying assets are made available for the customers’ use. Variable lease income is recognized in the period in which the underlying changes in facts and circumstances occur.

The Company also enters into sublease arrangements for portions of its leased data center capacity. These subleases generally include fixed payments with automatic renewal options, unless the sub-tenant provides at least 90 days’ notice of non-renewal prior to the end of the then-current term.

The Company receives advance payments from customers under certain operating lease arrangements, which are recognized as lease income over the respective lease terms in accordance with ASC 842. As of September 30, 2026 and December 31, 2025, deferred lease income related to these arrangements was $151.9 million and $71.8 million, respectively, and was included in deferred revenue in the consolidated balance sheets.

For the nine months ended September 30, 2026, the Company recognized operating lease income of $9.8 million primarily from its data center colocation arrangements and other sublease arrangements. Operating lease income is included in colocation services revenue and sublease income is included in other income in the condensed consolidated statements of operations.

The following table illustrates the future lease payments to be received by the Company under its operating lease arrangements, including data center leases and subleases, as of September 30, 2026: