Annual report [Section 13 and 15(d), not S-K Item 405]

Operating Right-of-Use Asset and Operating Lease Liability

v3.25.4
Operating Right-of-Use Asset and Operating Lease Liability
 12 Months Ended
Dec. 31, 2025
Leases [Abstract]  
Operating Right-of-Use Asset and Operating Lease Liability Operating Right-of-Use Asset and Operating Lease Liability
Strata’s operating leases consist of offices, vehicles and aircraft leases that are embedded within certain CPAs. Upon meeting certain criteria as stated in ASC 842 Leases (“ASC 842”), the lease component of a CPA would be accounted for as an embedded lease, with a corresponding balance included in the operating ROU asset and lease liability.
During the year ended December 31, 2025, lease activity under ASC 842 included the following:

Effective in April 2025, an existing CPA for one aircraft was restated and amended to provide for a three-year term ending April 30, 2028. As a result, the Company recorded an additional ROU asset and corresponding lease liability of $592. Under the amended CPA, if the agreement expires or is terminated for cause, the flight-hour guarantee is prorated through the termination date. Additionally, Strata has the right to immediately terminate the agreement without penalty if a governmental authority imposes travel restrictions.

See Note 14, “Commitments and Contingencies”, for additional information about our capacity purchase agreements.
Balance sheet information related to the Company’s leases is presented below:
December 31,
2025		 December 31, 2024
Operating leases:
Operating right-of-use asset $ 3,107  $ 2,831 
Operating lease liability, current 652  682 
Operating lease liability, long-term 2,655  2,336 

The following provides details of the Company’s lease expense:
Year Ended December 31,
2025 2024
Lease cost:
Short-term lease cost
 $ 338  $ 404 
Operating lease cost - Selling, general and administrative
 849  584 
Operating lease cost - Cost of revenue (1)
 274  717 
Total $ 1,461  $ 1,705 
(1) Operating lease costs related to aircraft leases that are embedded within CPAs.

Other information related to leases is presented below:
December 31, 2025
Weighted-average discount rate – operating lease
 7.70  %
Weighted-average remaining lease term – operating lease (in years)
 4.9
Year Ended December 31,
2025 2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in operating leases $ 897  $ 820 

As of December 31, 2025, the expected annual minimum lease payments of the Company’s operating lease liabilities were as follows:
For the Year Ended December 31
2026 $ 880 
2027 864 
2028 677 
2029 578 
2030 595 
Thereafter 392 
Total future minimum lease payments, undiscounted
 3,986 
Less: Imputed interest for leases in excess of one year
 (679)
Present value of future minimum lease payments
 $ 3,307