Leases

12 Months Ended

Dec. 31, 2022

We lease certain facilities and equipment related primarily to R&D, administrative and commercial activities. Leases with terms of 12 months or less are expensed as incurred and are not recorded in the Consolidated Balance Sheets.

Most leases include one or more options to renew, with renewal terms that may extend the lease term up to seven years. The exercise of lease renewal options is at our sole discretion. In addition, some of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements neither contain residual value guarantees nor impose significant restrictions or covenants. We sublease certain real estate to third parties. Our sublease portfolio consists of operating leases from former R&D and administrative space.

The following table summarizes information related to our leases, all of which are classified as operating, included in our Consolidated Balance Sheets (in millions):


	December 31,
Consolidated Balance Sheets locations	2022		2021
Assets:
Other noncurrent assets	$	579	$	566
Liabilities:
Accrued liabilities	$	156	$	145
Other noncurrent liabilities	539		525
Total lease liabilities	$	695	$	670

The components of net lease costs were as follows (in millions):


	Years ended December 31,
Lease costs	2022		2021		2020
Operating(1)	$	218	$	237	$	223






Sublease income	(32)		(38)		(34)
Total net lease costs	$	186	$	199	$	189

____________

(1) Includes short-term leases and variable lease costs, which were not material for the years ended December 31, 2022, 2021 and 2020.

Maturities of lease liabilities as of December 31, 2022, were as follows (in millions):


Maturity dates	Amounts
2023	$	172
2024	109
2025	80
2026	70
2027	64
Thereafter	286
Total lease payments(1)	781
Less imputed interest	(86)
Present value of lease liabilities	$	695

____________

(1) Includes future rental commitments for abandoned leases of $90 million. We expect to receive total future rental income of $76 million related to noncancelable subleases for abandoned facilities.

The weighted-average remaining lease terms and weighted-average discount rates were as follows:


	December 31,
	2022		2021
Weighted-average remaining lease term (in years)	8.2		8.3
Weighted-average discount rate	2.7	%	2.5	%

Cash and noncash information related to our leases was as follows (in millions):


	Years ended December 31,
	2022		2021		2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	171	$	190	$	177


ROU assets obtained in exchange for lease obligations:
Operating leases	$	191	$	340	$	101

As of December 31, 2022, the total undiscounted future lease payments for leases that have not yet commenced were not material.