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Leases

12 Months Ended

Jan. 03, 2025

Leases [Abstract]

Leases

Note 10—Leases

LESSEE

ROU assets and lease liabilities consisted of the following:

(in millions)						Balance sheet line item						January 3, 2025						December 29, 2023
ROU assets:
Finance leases						Property, plant and equipment, net						$	69					$	89
Operating leases						Operating lease right-of-use assets, net						560						512
												$	629					$	601
Current lease liabilities:
Finance leases						Short-term debt and current portion of long-term debt						$	19					$	18
Operating leases						Accounts payable and accrued liabilities						123						136
												$	142					$	154
Non-current lease liabilities:
Finance leases						Long-term debt, net of current portion						$	54					$	73
Operating leases						Operating lease liabilities						621						516
												$	675					$	589

During fiscal 2024 and 2022, we reduced our leased space by exiting and consolidating underutilized buildings as part of an ongoing facility rationalization effort. We used discounted cash flow models to estimate the fair values of the affected assets and as a result, we recorded impairments of ROU and other assets in the amount of $11 million and $37 million for fiscal 2024 and 2022, respectively. The impairment charges were allocated across our reportable segments and to Corporate.

In fiscal 2024, we took occupancy of our newly constructed facility in San Diego, CA. As a result we recorded $117 million of ROU assets and $169 million of lease liabilities.

In fiscal 2022, the Company entered into a Master Lease Agreement whereby we agreed to lease two aircraft from the time each aircraft is accepted through June 30, 2027. In March 2023, we took possession of both aircraft and recognized a $64 million finance lease obligation and a corresponding ROU asset.

Total lease cost for the periods presented consisted of the following:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Finance lease cost:
Amortization of ROU assets						$	20					$	18					$	9
Interest on lease liabilities						4						4						1
						24						22						10
Operating lease cost(1)						143						148						161
Variable lease cost						35						35						42
Short-term lease cost						4						2						3
Less: Sublease income						—						—						(6)
Total lease cost						$	206					$	207					$	210

(1)Includes ROU lease expense of $119 million, $124 million and $134 million for fiscal 2024, 2023 and 2022, respectively.

Lease costs and sublease income are included in “Cost of revenues” and “Selling, general and administrative expenses” within the consolidated statements of operations.

Lease terms and discount rates related to leases were as follows:

						Year Ended
						January 3, 2025						December 29, 2023						December 30, 2022
Weighted-average remaining lease term (in years):
Finance leases						4.4						5.2						8.2
Operating leases						9.9						7.3						7.5
Weighted-average discount rate:
Finance leases						4.7		%				4.8		%				2.6		%
Operating leases						4.5		%				3.7		%				3.3		%

Other information related to leases was as follows:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Cash paid for amounts included in measurement of lease liabilities:
Operating cash related to finance leases						$	4					$	4					$	1
Operating cash related to operating leases						163						167						168
Financing cash flows related to finance leases						18						17						9
ROU assets obtained in exchange for lease liabilities:
Finance lease liabilities						$	—					$	63					$	1
Operating lease liabilities						236						97						122

The change in operating ROU assets and lease liabilities are presented within cash flows from operations on the consolidated statements of cash flows.

Future minimum lease commitments of our finance and operating leases on an undiscounted basis, reconciled to the respective lease liability at January 3, 2025, were as follows:

Fiscal Year Ending (in millions)						Finance lease commitments						Operating lease commitments
2025						$	22					$	153
2026						22						117
2027						14						88
2028						5						88
2029						5						76
2030 and thereafter						12						433
Total undiscounted cash flows						80						955
Less: imputed interest						(7)						(211)
Lease liability as of January 3, 2025						$	73					$	744

LESSOR

As of January 3, 2025, and December 29, 2023, we had a total net investment in sales-type leases, which relates to lease payment receivables, of $94 million and $100 million, respectively. The current and non-current portions of net investment in sales-type leases are included within “Other current assets” and “Other long-term assets”, respectively, on the consolidated balance sheets.

The components of lease income were as follows:

												Year Ended
(in millions)						Statement of operations line item						January 3, 2025						December 29, 2023						December 30, 2022
Sales-type leases:
Selling price at lease commencement						Revenues						$	55					$	51					$	65
Cost of underlying asset						Cost of revenues						(40)						(41)						(52)
Operating income												15						10						13
Interest income on lease receivables						Revenues						5						9						9
												20						19						22
Operating lease income						Revenues						26						39						35
Total lease income												$	46					$	58					$	57

As of January 3, 2025, undiscounted cash flows for sales-type and operating leases for the next five years are as follows:

Fiscal Year Ending (in millions)			Sales-type leases						Operating leases
2025			$	43					$	5
2026			32						—
2027			18						—
2028			4						—
2029			1						—
Total undiscounted cash flows			$	98					$	5
Present value of lease payments as lease receivables			94
Difference between undiscounted cash flows and discounted cash flows			$	4

Leases

Note 10—Leases

LESSEE

ROU assets and lease liabilities consisted of the following:

(in millions)						Balance sheet line item						January 3, 2025						December 29, 2023
ROU assets:
Finance leases						Property, plant and equipment, net						$	69					$	89
Operating leases						Operating lease right-of-use assets, net						560						512
												$	629					$	601
Current lease liabilities:
Finance leases						Short-term debt and current portion of long-term debt						$	19					$	18
Operating leases						Accounts payable and accrued liabilities						123						136
												$	142					$	154
Non-current lease liabilities:
Finance leases						Long-term debt, net of current portion						$	54					$	73
Operating leases						Operating lease liabilities						621						516
												$	675					$	589

During fiscal 2024 and 2022, we reduced our leased space by exiting and consolidating underutilized buildings as part of an ongoing facility rationalization effort. We used discounted cash flow models to estimate the fair values of the affected assets and as a result, we recorded impairments of ROU and other assets in the amount of $11 million and $37 million for fiscal 2024 and 2022, respectively. The impairment charges were allocated across our reportable segments and to Corporate.

In fiscal 2024, we took occupancy of our newly constructed facility in San Diego, CA. As a result we recorded $117 million of ROU assets and $169 million of lease liabilities.

In fiscal 2022, the Company entered into a Master Lease Agreement whereby we agreed to lease two aircraft from the time each aircraft is accepted through June 30, 2027. In March 2023, we took possession of both aircraft and recognized a $64 million finance lease obligation and a corresponding ROU asset.

Total lease cost for the periods presented consisted of the following:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Finance lease cost:
Amortization of ROU assets						$	20					$	18					$	9
Interest on lease liabilities						4						4						1
						24						22						10
Operating lease cost(1)						143						148						161
Variable lease cost						35						35						42
Short-term lease cost						4						2						3
Less: Sublease income						—						—						(6)
Total lease cost						$	206					$	207					$	210

(1)Includes ROU lease expense of $119 million, $124 million and $134 million for fiscal 2024, 2023 and 2022, respectively.

Lease costs and sublease income are included in “Cost of revenues” and “Selling, general and administrative expenses” within the consolidated statements of operations.

Lease terms and discount rates related to leases were as follows:

						Year Ended
						January 3, 2025						December 29, 2023						December 30, 2022
Weighted-average remaining lease term (in years):
Finance leases						4.4						5.2						8.2
Operating leases						9.9						7.3						7.5
Weighted-average discount rate:
Finance leases						4.7		%				4.8		%				2.6		%
Operating leases						4.5		%				3.7		%				3.3		%

Other information related to leases was as follows:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Cash paid for amounts included in measurement of lease liabilities:
Operating cash related to finance leases						$	4					$	4					$	1
Operating cash related to operating leases						163						167						168
Financing cash flows related to finance leases						18						17						9
ROU assets obtained in exchange for lease liabilities:
Finance lease liabilities						$	—					$	63					$	1
Operating lease liabilities						236						97						122

The change in operating ROU assets and lease liabilities are presented within cash flows from operations on the consolidated statements of cash flows.

Future minimum lease commitments of our finance and operating leases on an undiscounted basis, reconciled to the respective lease liability at January 3, 2025, were as follows:

Fiscal Year Ending (in millions)						Finance lease commitments						Operating lease commitments
2025						$	22					$	153
2026						22						117
2027						14						88
2028						5						88
2029						5						76
2030 and thereafter						12						433
Total undiscounted cash flows						80						955
Less: imputed interest						(7)						(211)
Lease liability as of January 3, 2025						$	73					$	744

LESSOR

As of January 3, 2025, and December 29, 2023, we had a total net investment in sales-type leases, which relates to lease payment receivables, of $94 million and $100 million, respectively. The current and non-current portions of net investment in sales-type leases are included within “Other current assets” and “Other long-term assets”, respectively, on the consolidated balance sheets.

The components of lease income were as follows:

												Year Ended
(in millions)						Statement of operations line item						January 3, 2025						December 29, 2023						December 30, 2022
Sales-type leases:
Selling price at lease commencement						Revenues						$	55					$	51					$	65
Cost of underlying asset						Cost of revenues						(40)						(41)						(52)
Operating income												15						10						13
Interest income on lease receivables						Revenues						5						9						9
												20						19						22
Operating lease income						Revenues						26						39						35
Total lease income												$	46					$	58					$	57

As of January 3, 2025, undiscounted cash flows for sales-type and operating leases for the next five years are as follows:

Fiscal Year Ending (in millions)			Sales-type leases						Operating leases
2025			$	43					$	5
2026			32						—
2027			18						—
2028			4						—
2029			1						—
Total undiscounted cash flows			$	98					$	5
Present value of lease payments as lease receivables			94
Difference between undiscounted cash flows and discounted cash flows			$	4

Leases

Note 10—Leases

LESSEE

ROU assets and lease liabilities consisted of the following:

(in millions)						Balance sheet line item						January 3, 2025						December 29, 2023
ROU assets:
Finance leases						Property, plant and equipment, net						$	69					$	89
Operating leases						Operating lease right-of-use assets, net						560						512
												$	629					$	601
Current lease liabilities:
Finance leases						Short-term debt and current portion of long-term debt						$	19					$	18
Operating leases						Accounts payable and accrued liabilities						123						136
												$	142					$	154
Non-current lease liabilities:
Finance leases						Long-term debt, net of current portion						$	54					$	73
Operating leases						Operating lease liabilities						621						516
												$	675					$	589

During fiscal 2024 and 2022, we reduced our leased space by exiting and consolidating underutilized buildings as part of an ongoing facility rationalization effort. We used discounted cash flow models to estimate the fair values of the affected assets and as a result, we recorded impairments of ROU and other assets in the amount of $11 million and $37 million for fiscal 2024 and 2022, respectively. The impairment charges were allocated across our reportable segments and to Corporate.

In fiscal 2024, we took occupancy of our newly constructed facility in San Diego, CA. As a result we recorded $117 million of ROU assets and $169 million of lease liabilities.

In fiscal 2022, the Company entered into a Master Lease Agreement whereby we agreed to lease two aircraft from the time each aircraft is accepted through June 30, 2027. In March 2023, we took possession of both aircraft and recognized a $64 million finance lease obligation and a corresponding ROU asset.

Total lease cost for the periods presented consisted of the following:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Finance lease cost:
Amortization of ROU assets						$	20					$	18					$	9
Interest on lease liabilities						4						4						1
						24						22						10
Operating lease cost(1)						143						148						161
Variable lease cost						35						35						42
Short-term lease cost						4						2						3
Less: Sublease income						—						—						(6)
Total lease cost						$	206					$	207					$	210

(1)Includes ROU lease expense of $119 million, $124 million and $134 million for fiscal 2024, 2023 and 2022, respectively.

Lease costs and sublease income are included in “Cost of revenues” and “Selling, general and administrative expenses” within the consolidated statements of operations.

Lease terms and discount rates related to leases were as follows:

						Year Ended
						January 3, 2025						December 29, 2023						December 30, 2022
Weighted-average remaining lease term (in years):
Finance leases						4.4						5.2						8.2
Operating leases						9.9						7.3						7.5
Weighted-average discount rate:
Finance leases						4.7		%				4.8		%				2.6		%
Operating leases						4.5		%				3.7		%				3.3		%

Other information related to leases was as follows:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Cash paid for amounts included in measurement of lease liabilities:
Operating cash related to finance leases						$	4					$	4					$	1
Operating cash related to operating leases						163						167						168
Financing cash flows related to finance leases						18						17						9
ROU assets obtained in exchange for lease liabilities:
Finance lease liabilities						$	—					$	63					$	1
Operating lease liabilities						236						97						122

The change in operating ROU assets and lease liabilities are presented within cash flows from operations on the consolidated statements of cash flows.

Future minimum lease commitments of our finance and operating leases on an undiscounted basis, reconciled to the respective lease liability at January 3, 2025, were as follows:

Fiscal Year Ending (in millions)						Finance lease commitments						Operating lease commitments
2025						$	22					$	153
2026						22						117
2027						14						88
2028						5						88
2029						5						76
2030 and thereafter						12						433
Total undiscounted cash flows						80						955
Less: imputed interest						(7)						(211)
Lease liability as of January 3, 2025						$	73					$	744

LESSOR

As of January 3, 2025, and December 29, 2023, we had a total net investment in sales-type leases, which relates to lease payment receivables, of $94 million and $100 million, respectively. The current and non-current portions of net investment in sales-type leases are included within “Other current assets” and “Other long-term assets”, respectively, on the consolidated balance sheets.

The components of lease income were as follows:

												Year Ended
(in millions)						Statement of operations line item						January 3, 2025						December 29, 2023						December 30, 2022
Sales-type leases:
Selling price at lease commencement						Revenues						$	55					$	51					$	65
Cost of underlying asset						Cost of revenues						(40)						(41)						(52)
Operating income												15						10						13
Interest income on lease receivables						Revenues						5						9						9
												20						19						22
Operating lease income						Revenues						26						39						35
Total lease income												$	46					$	58					$	57

As of January 3, 2025, undiscounted cash flows for sales-type and operating leases for the next five years are as follows:

Fiscal Year Ending (in millions)			Sales-type leases						Operating leases
2025			$	43					$	5
2026			32						—
2027			18						—
2028			4						—
2029			1						—
Total undiscounted cash flows			$	98					$	5
Present value of lease payments as lease receivables			94
Difference between undiscounted cash flows and discounted cash flows			$	4

Leases

Note 10—Leases

LESSEE

ROU assets and lease liabilities consisted of the following:

(in millions)						Balance sheet line item						January 3, 2025						December 29, 2023
ROU assets:
Finance leases						Property, plant and equipment, net						$	69					$	89
Operating leases						Operating lease right-of-use assets, net						560						512
												$	629					$	601
Current lease liabilities:
Finance leases						Short-term debt and current portion of long-term debt						$	19					$	18
Operating leases						Accounts payable and accrued liabilities						123						136
												$	142					$	154
Non-current lease liabilities:
Finance leases						Long-term debt, net of current portion						$	54					$	73
Operating leases						Operating lease liabilities						621						516
												$	675					$	589

During fiscal 2024 and 2022, we reduced our leased space by exiting and consolidating underutilized buildings as part of an ongoing facility rationalization effort. We used discounted cash flow models to estimate the fair values of the affected assets and as a result, we recorded impairments of ROU and other assets in the amount of $11 million and $37 million for fiscal 2024 and 2022, respectively. The impairment charges were allocated across our reportable segments and to Corporate.

In fiscal 2024, we took occupancy of our newly constructed facility in San Diego, CA. As a result we recorded $117 million of ROU assets and $169 million of lease liabilities.

In fiscal 2022, the Company entered into a Master Lease Agreement whereby we agreed to lease two aircraft from the time each aircraft is accepted through June 30, 2027. In March 2023, we took possession of both aircraft and recognized a $64 million finance lease obligation and a corresponding ROU asset.

Total lease cost for the periods presented consisted of the following:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Finance lease cost:
Amortization of ROU assets						$	20					$	18					$	9
Interest on lease liabilities						4						4						1
						24						22						10
Operating lease cost(1)						143						148						161
Variable lease cost						35						35						42
Short-term lease cost						4						2						3
Less: Sublease income						—						—						(6)
Total lease cost						$	206					$	207					$	210

(1)Includes ROU lease expense of $119 million, $124 million and $134 million for fiscal 2024, 2023 and 2022, respectively.

Lease costs and sublease income are included in “Cost of revenues” and “Selling, general and administrative expenses” within the consolidated statements of operations.

Lease terms and discount rates related to leases were as follows:

						Year Ended
						January 3, 2025						December 29, 2023						December 30, 2022
Weighted-average remaining lease term (in years):
Finance leases						4.4						5.2						8.2
Operating leases						9.9						7.3						7.5
Weighted-average discount rate:
Finance leases						4.7		%				4.8		%				2.6		%
Operating leases						4.5		%				3.7		%				3.3		%

Other information related to leases was as follows:

						Year Ended
(in millions)						January 3, 2025						December 29, 2023						December 30, 2022
Cash paid for amounts included in measurement of lease liabilities:
Operating cash related to finance leases						$	4					$	4					$	1
Operating cash related to operating leases						163						167						168
Financing cash flows related to finance leases						18						17						9
ROU assets obtained in exchange for lease liabilities:
Finance lease liabilities						$	—					$	63					$	1
Operating lease liabilities						236						97						122

The change in operating ROU assets and lease liabilities are presented within cash flows from operations on the consolidated statements of cash flows.

Future minimum lease commitments of our finance and operating leases on an undiscounted basis, reconciled to the respective lease liability at January 3, 2025, were as follows:

Fiscal Year Ending (in millions)						Finance lease commitments						Operating lease commitments
2025						$	22					$	153
2026						22						117
2027						14						88
2028						5						88
2029						5						76
2030 and thereafter						12						433
Total undiscounted cash flows						80						955
Less: imputed interest						(7)						(211)
Lease liability as of January 3, 2025						$	73					$	744

LESSOR

As of January 3, 2025, and December 29, 2023, we had a total net investment in sales-type leases, which relates to lease payment receivables, of $94 million and $100 million, respectively. The current and non-current portions of net investment in sales-type leases are included within “Other current assets” and “Other long-term assets”, respectively, on the consolidated balance sheets.

The components of lease income were as follows:

												Year Ended
(in millions)						Statement of operations line item						January 3, 2025						December 29, 2023						December 30, 2022
Sales-type leases:
Selling price at lease commencement						Revenues						$	55					$	51					$	65
Cost of underlying asset						Cost of revenues						(40)						(41)						(52)
Operating income												15						10						13
Interest income on lease receivables						Revenues						5						9						9
												20						19						22
Operating lease income						Revenues						26						39						35
Total lease income												$	46					$	58					$	57

As of January 3, 2025, undiscounted cash flows for sales-type and operating leases for the next five years are as follows:

Fiscal Year Ending (in millions)			Sales-type leases						Operating leases
2025			$	43					$	5
2026			32						—
2027			18						—
2028			4						—
2029			1						—
Total undiscounted cash flows			$	98					$	5
Present value of lease payments as lease receivables			94
Difference between undiscounted cash flows and discounted cash flows			$	4

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The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability.

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-Topic 842
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-Topic 842
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-Topic 842
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