Company: UP
Filing Date: 2025-05-05
Form Type: 10-Q
Source: 0001819516-25-000028
Chunk: 46

Company: Wheels Up Experience Inc.
Filing Date: 2025-05-05
Form: 10-Q
Item: Item 1
Chunk 46
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in thousands):Three Months Ended March 31,20252024Operating lease costs$5,618 $7,540 Short-term lease costs868 213 Variable lease payments1,976 4,313 Total lease costs$8,462 $12,066 Lease costs related to leased aircraft and operational facilities are included in Cost of revenue in the condensed consolidated statements of operations. Lease costs related to leased aircraft were $5.4 million and $8.1 million during  the three months ended March 31, 2025 and 2024, respectively.Lease costs related to our leased corporate headquarters and other office space, including expenses for non-lease components, are allocated within the condensed consolidated statements of operations based on employee headcount. Sublease income is presented in General and administrative expenses in the condensed consolidated statements of operations, and was not material for each of the three months ended March 31, 2025 and 2024. As part of our continuing cost reduction initiatives, in the first quarter of 2025, we leased alternative corporate office space in New York City and vacated a larger leased corporate office space in New York City, for which we are actively seeking a sublease tenant. Vacating the former office space was identified as a triggering event for impairment testing for the impacted asset group, including the right-of-use asset and associated leasehold improvements and furniture. We estimated the fair value of the asset group using a discounted cash flow approach, which considered estimated future cash flows associated with the asset group. We recorded a non-cash impairment charge of $20.2 million during the three months ended March 31, 2025 representing the full carrying value of the right of use asset for the vacated space. The impairment charge is presented in General and administrative expense in the condensed consolidated statements of operations.

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Supplemental cash flow information related to operating leases were as follows (in thousands):Three Months Ended March 31,20252024Cash paid for amounts included in the measurement of operating lease liabilities:Operating cash flows paid for operating leases$5,457 $7,685 Right-of-use assets obtained in exchange for operating lease obligations$10,614 $— Supplemental balance sheet information related to leases were as follows:March 31, 2025December 31, 2024Weighted-average remaining lease term (in years):Operating leases6.96.6Weighted-average discount rate:Operating leases10.5%10