For some of our offices and data centers, we have entered into non-cancelable operating lease agreements with various expiration dates through 2035. Certain lease agreements include options to renew or terminate the lease, which are not reasonably certain to be exercised and therefore are not factored into our determination of lease payments.

Total operating lease costs was $112 million, $100 million and $83 million, excluding short-term lease costs, variable lease costs and sublease income each of which were immaterial, for each of the years ended December 31, 2022, 2021 and 2020, respectively.

Total cash paid for amounts included in the measurement of operating lease liabilities was $75 million for each of the years ended December 31, 2022 and 2021. Operating lease liabilities arising from obtaining operating right-of-use assets was $192 million and $223 million for the years ended December 31, 2022 and 2021, respectively, which is largely related to additional office facilities located in Santa Clara, California in line with the original commitment.

As of December 31, 2022, the weighted-average remaining lease term is approximately ten years and the weighted-average discount rate is 3.5%.


Years Ending December 31,
2023	$	115
2024	100
2025	100
2026	81
2027	71
Thereafter	428
Total operating lease payments	895
Less: imputed interest	(149)
Present value of operating lease liabilities	$	746

In addition to the amounts above, as of December 31, 2022, we have operating leases, primarily for offices, that have not yet commenced with undiscounted cash flows of $103 million. These operating leases are expected to commence in 2023 with lease terms of ten to twelve years.

Other contractual commitments consist of data center and IT operations and sales and marketing activities related to our daily business operations. Future minimum payments under our non-cancelable purchase commitments as of December 31, 2022 are presented in the table below (in millions):

(1)Not included in the table above are certain purchase commitments related to our future annual Knowledge user conferences and other customer or sales conferences to be held in 2023 and future years. If we had canceled these contractual commitments as of December 31, 2022, we would have been obligated to pay cancellation penalties of approximately $56 million in aggregate. In addition, during 2022, we entered into a non-cancelable $500 million agreement with Microsoft to purchase cloud services over five years, as we accelerate Azure adoption for mutual customers. The unutilized consumption is included within the table above.

In addition to the amounts above, the repayment of our 2030 Notes with an aggregate principal amount of $1.5 billion is due on September 1, 2030. Refer to Note 11 for further information regarding our 2030 Notes. Further, $31 million of unrecognized tax benefits have been recorded as liabilities as of December 31, 2022.

From time to time, we are party to litigation and other legal proceedings in the ordinary course of business. While the results of any litigation or other legal proceedings are uncertain, management does not believe the ultimate resolution of any pending legal matters is likely to have a material adverse effect on our financial position, results of operations or cash flows, except for those matters for which we have recorded a loss contingency. We accrue for loss contingencies when it is both probable that we will incur the loss and when we can reasonably estimate the amount of the loss or range of loss.

Generally, our subscription agreements require us to defend our customers for third-party intellectual property infringement and other claims. Any adverse determination related to intellectual property claims or other litigation could prevent us from offering our services and adversely affect our financial condition and results of operations.

Our agreements include provisions indemnifying customers against intellectual property and other third-party claims. In addition, we have entered into indemnification agreements with our directors, executive officers and certain other officers that will require us, among other things, to indemnify them against certain liabilities that may arise as a result of their affiliation with us. We have not incurred any costs as a result of such indemnification obligations and have not recorded any liabilities related to such obligations in the consolidated financial statements.