Company: STGW
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000876883-25-000034
Chunk: 73

Company: Stagwell Inc
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 1
Chunk 73
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 the Company enters into sublease arrangements with unrelated third parties. These subleases are classified as operating leases and expire between years 2025 and 2032. Sublease income is recognized over the lease term on a straight-line basis. Currently, the Company subleases office space in North America and Europe.The discount rate used for leases accounted for under the FASB’s Accounting Standards Codification 842 (“ASC 842”) is the Company’s collateralized credit adjusted borrowing rate.

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The following table presents lease costs and other quantitative information for the three and nine months ended September 30, 2025 and 2024:Three Months Ended September 30,Nine Months Ended September 30, 2025202420252024Lease Cost:(dollars in thousands)Operating lease cost$17,133$18,589$51,208$58,237Variable lease cost5,4656,52816,61018,354Sublease rental income(2,029)(2,001)(6,325)(6,416)Total lease cost$20,569$23,116$61,493$70,175Additional information:Cash paid for amounts included in the measurement of lease liabilities for operating leasesOperating cash flows$19,208$21,588$59,375$65,407Right-of-use lease assets obtained in exchange for operating lease liabilities and other non-cash adjustments$11,686$3,311$33,322$16,449As of September 30, 2025, the weighted average remaining lease term was 5.5 years, and the weighted average discount rate was 5.8%.Operating lease expense is included in Office and general expenses in the Unaudited Consolidated Statements of Operations. The Company’s lease expense for leases with a term of 12 months or less was immaterial.For the three and nine months ended September 30, 2025, the Company recognized an impairment charge of $0.5 million to reduce the carrying value of two of its right-of-use lease assets within the Communications and The Marketing Cloud segments.As of September 30, 2025, the Company had entered into one operating lease for which the commencement date had not yet occurred because the premises were being prepared for occupancy by the landlords. Accordingly, this lease represents obligations of the Company that was not reflected within the Unaudited Consolidated Balance Sheets as of September 30, 2025. The aggregate future liability related to this lease was $11.3 million as of