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Leases
 12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
Leases LEASES:
Quanta primarily leases land, buildings, vehicles, construction equipment and office equipment. As of December 31, 2024, the majority of Quanta’s leases had remaining lease terms of less than 13 years. Certain leases include options to extend their terms in increments of up to five years and/or options to terminate. The components of lease costs in the accompanying consolidated statements of operations are as follows (in thousands):
 Year Ended December 31,
Lease and lease financing costClassification202420232022
Finance lease cost:
Amortization of lease assets
Depreciation (1)
$11,462 $4,944 $1,540 
Interest on lease liabilitiesInterest and other financing expenses2,798 1,463 108 
Lease financing transactions:(2)
Depreciation
Depreciation (1)
10,396 7,698 5,303 
Interest
Interest and other financing expenses17,600 12,992 8,405 
Operating lease costCost of services and Selling, general and administrative expenses108,879 93,133 93,539 
Short-term and variable lease cost (3)
Cost of services and Selling, general and administrative expenses1,245,011 1,106,454 953,721 
Total lease and lease financing cost $1,396,146 $1,226,684 $1,062,616 
(1)    Depreciation is included within “Cost of services” and “Selling, general and administrative expenses” in the accompanying consolidated statements of operations.
(2)    Certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. When these purchase options are exercised by a third-party lessor on behalf of Quanta, the transaction is deemed to be a financing transaction for accounting purposes, which results in the recognition of an asset equal to the purchase price and a corresponding liability.
(3)    Short-term lease cost includes both leases and rentals with initial terms of one year or less. Variable lease cost is insignificant.
Quanta has entered into arrangements with certain related parties to lease real and personal property and facilities. Typically, the parties are employees of Quanta who are also the former owners of businesses acquired by Quanta, and the real property and facilities continue to be utilized by Quanta subsequent to the acquisitions. Quanta utilizes third-party market valuations to evaluate rental rates for these properties and facilities, and the lease agreements generally have remaining lease terms of up to ten years, subject to renewal options. Related party lease expense was $18.7 million, $16.5 million and $14.7 million for the years ended December 31, 2024, 2023 and 2022.
The components of leases in the accompanying consolidated balance sheets were as follows (in thousands):
December 31,
Lease typeClassification20242023
Assets:
Operating lease right-of-use assetsOperating lease right-of-use assets$299,895 $249,443 
Finance lease assetsProperty and equipment, net of accumulated depreciation43,018 35,770 
Lease financing transaction assets
Property and equipment, net of accumulated depreciation155,548 102,955 
Total lease and lease financing assets
 $498,461 $388,168 
Liabilities:
Current:
OperatingCurrent portion of operating lease liabilities$94,162 $77,995 
FinanceCurrent maturities of long-term debt and short-term debt11,641 7,767 
Lease financing transaction liabilities Current maturities of long-term debt and short-term debt11,307 7,345 
Non-current:
OperatingOperating lease liabilities, net of current portion222,359 186,996 
FinanceLong-term debt, net of current maturities36,352 31,810 
Lease financing transaction liabilities Long-term debt, net of current maturities144,242 95,610 
Total lease and lease financing liabilities
 $520,063 $407,523 
Future minimum lease payments for operating leases and finance leases were as follows (in thousands):
As of December 31, 2024
 Operating LeasesFinance LeasesTotal
2025$107,468 $13,225 $120,693 
202686,518 12,244 98,762 
202762,115 10,847 72,962 
202840,801 8,707 49,508 
202918,475 7,291 25,766 
Thereafter39,456 2,737 42,193 
Total future minimum payments related to operating leases and finance leases354,833 55,051 409,884 
Less imputed interest(38,312)(7,058)(45,370)
Total$316,521 $47,993 $364,514 
Future minimum lease payments for short-term leases were $27.3 million as of December 31, 2024. Additionally, as described above, certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. The future payments related to these lease financing transactions totaled $120.5 million and comprise principal and interest payments. The principal payments related to lease financing transactions required to be made during the next five years are included in the debt maturity table in Note 10.
The weighted average remaining lease terms (other than for short-term leases) and discount rates were as follows:
 As of December 31,
20242023
Weighted average remaining lease term (in years):
Operating leases4.484.34
Finance leases4.355.69
Weighted average discount rate:
Operating leases5.1 %4.3 %
Finance leases6.1 %6.3 %
Quanta has also guaranteed the residual value under certain of its equipment operating leases and real estate finance leases, agreeing to pay any difference between the residual value and the fair market value of the underlying asset at the date of lease termination. Historically, the fair value of the assets at the time of lease termination generally has approximated or exceeded the residual value guarantees, and therefore such guarantees are not expected to result in significant payments.
Leases LEASES:
Quanta primarily leases land, buildings, vehicles, construction equipment and office equipment. As of December 31, 2024, the majority of Quanta’s leases had remaining lease terms of less than 13 years. Certain leases include options to extend their terms in increments of up to five years and/or options to terminate. The components of lease costs in the accompanying consolidated statements of operations are as follows (in thousands):
 Year Ended December 31,
Lease and lease financing costClassification202420232022
Finance lease cost:
Amortization of lease assets
Depreciation (1)
$11,462 $4,944 $1,540 
Interest on lease liabilitiesInterest and other financing expenses2,798 1,463 108 
Lease financing transactions:(2)
Depreciation
Depreciation (1)
10,396 7,698 5,303 
Interest
Interest and other financing expenses17,600 12,992 8,405 
Operating lease costCost of services and Selling, general and administrative expenses108,879 93,133 93,539 
Short-term and variable lease cost (3)
Cost of services and Selling, general and administrative expenses1,245,011 1,106,454 953,721 
Total lease and lease financing cost $1,396,146 $1,226,684 $1,062,616 
(1)    Depreciation is included within “Cost of services” and “Selling, general and administrative expenses” in the accompanying consolidated statements of operations.
(2)    Certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. When these purchase options are exercised by a third-party lessor on behalf of Quanta, the transaction is deemed to be a financing transaction for accounting purposes, which results in the recognition of an asset equal to the purchase price and a corresponding liability.
(3)    Short-term lease cost includes both leases and rentals with initial terms of one year or less. Variable lease cost is insignificant.
Quanta has entered into arrangements with certain related parties to lease real and personal property and facilities. Typically, the parties are employees of Quanta who are also the former owners of businesses acquired by Quanta, and the real property and facilities continue to be utilized by Quanta subsequent to the acquisitions. Quanta utilizes third-party market valuations to evaluate rental rates for these properties and facilities, and the lease agreements generally have remaining lease terms of up to ten years, subject to renewal options. Related party lease expense was $18.7 million, $16.5 million and $14.7 million for the years ended December 31, 2024, 2023 and 2022.
The components of leases in the accompanying consolidated balance sheets were as follows (in thousands):
December 31,
Lease typeClassification20242023
Assets:
Operating lease right-of-use assetsOperating lease right-of-use assets$299,895 $249,443 
Finance lease assetsProperty and equipment, net of accumulated depreciation43,018 35,770 
Lease financing transaction assets
Property and equipment, net of accumulated depreciation155,548 102,955 
Total lease and lease financing assets
 $498,461 $388,168 
Liabilities:
Current:
OperatingCurrent portion of operating lease liabilities$94,162 $77,995 
FinanceCurrent maturities of long-term debt and short-term debt11,641 7,767 
Lease financing transaction liabilities Current maturities of long-term debt and short-term debt11,307 7,345 
Non-current:
OperatingOperating lease liabilities, net of current portion222,359 186,996 
FinanceLong-term debt, net of current maturities36,352 31,810 
Lease financing transaction liabilities Long-term debt, net of current maturities144,242 95,610 
Total lease and lease financing liabilities
 $520,063 $407,523 
Future minimum lease payments for operating leases and finance leases were as follows (in thousands):
As of December 31, 2024
 Operating LeasesFinance LeasesTotal
2025$107,468 $13,225 $120,693 
202686,518 12,244 98,762 
202762,115 10,847 72,962 
202840,801 8,707 49,508 
202918,475 7,291 25,766 
Thereafter39,456 2,737 42,193 
Total future minimum payments related to operating leases and finance leases354,833 55,051 409,884 
Less imputed interest(38,312)(7,058)(45,370)
Total$316,521 $47,993 $364,514 
Future minimum lease payments for short-term leases were $27.3 million as of December 31, 2024. Additionally, as described above, certain of Quanta’s equipment rental agreements contain purchase options pursuant to which the purchase price is offset by a portion of the rental payments. The future payments related to these lease financing transactions totaled $120.5 million and comprise principal and interest payments. The principal payments related to lease financing transactions required to be made during the next five years are included in the debt maturity table in Note 10.
The weighted average remaining lease terms (other than for short-term leases) and discount rates were as follows:
 As of December 31,
20242023
Weighted average remaining lease term (in years):
Operating leases4.484.34
Finance leases4.355.69
Weighted average discount rate:
Operating leases5.1 %4.3 %
Finance leases6.1 %6.3 %
Quanta has also guaranteed the residual value under certain of its equipment operating leases and real estate finance leases, agreeing to pay any difference between the residual value and the fair market value of the underlying asset at the date of lease termination. Historically, the fair value of the assets at the time of lease termination generally has approximated or exceeded the residual value guarantees, and therefore such guarantees are not expected to result in significant payments.