Western Union CO

The Company leases real properties for use as Company-operated locations, administrative offices, and sales offices, in addition to transportation, office, and other equipment. The Company determines if a contract contains a lease arrangement at the inception of the contract. For leases in which the Company is the lessee, leases are classified as either finance or operating, with classification affecting the pattern of expense recognition. Operating lease right of use (“ROU”) assets are initially measured at the present value of lease payments over the lease term plus initial direct costs, if any. If a lease does not provide a discount rate and the rate cannot be readily determined, an incremental borrowing rate is used to determine the present value of future lease payments. Lease and variable non-lease components within the Company’s lease agreements are accounted for separately. The Company has no material leases in which the Company is the lessor.

The Company’s leasing arrangements are classified as operating leases, for which expense is recognized on a straight-line basis. As of December 31, 2025 and 2024, total ROU assets were$195.2 million and$161.1 million, respectively, and operating lease liabilities were$225.7 million and$191.2 million, respectively. The ROU assets and operating lease liabilities are included in Other assets and Other liabilities, respectively, in the Company’s Consolidated Balance Sheets. Cash paid for operating lease liabilities is included in Cash flows from operating activities in the Company’s Consolidated Statements of Cash Flows. Operating lease costs, which are included in Total expenses in the Company’s Consolidated Statements of Income, were $69.1 million, $52.5 million, and $37.4 million for the years ended December 31, 2025, 2024, and 2023, respectively. Short-term and variable lease costs were not material for the years ended December 31, 2025, 2024, and 2023.

The Company’s leases have remaining terms from less than 1 year to 10 years. Certain of these leases contain escalation provisions and/or renewal options, giving the Company theright to extend the lease by up to 10 years. However, a substantial majority of these options are not reflected in the calculation of the ROU asset and operating lease liability due to uncertainty surrounding the likelihood of renewal.

The following table summarizes the weighted-average lease terms and discount rates for operating lease liabilities:

The following table represents maturities of operating lease liabilities as of December 31, 2025 (in millions):