Jackson Financial Inc.JXN

Jackson Financial Inc. Leases Disclosure

10-KFiled Feb 24, 20262 min read
Leases
The Company leases office space and equipment under several operating leases that expire at various dates through 2051. The Company determines if a contract is a lease at inception or modification. Lease terms may include options to extend or terminate the lease and are included in the lease measurement when it is reasonably certain that the Company will exercise that option. Right-of-use (“ROU”) assets represent the right to use an underlying asset for the lease term and corresponding lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and liabilities are determined using the Company’s incremental borrowings rate based upon information available at lease commencement. Certain lease incentives such as free rent periods are recorded as a reduction of the ROU asset. Lease costs for operating leases are recognized on a straight-line basis over the life of the lease.

The Company has lease agreements with both lease and non-lease components. The Company elected the practical expedient to combine lease and non-lease components for certain real estate leases.

Variable lease expenses may include changes in index-linked lease payments and certain variable operating expenses associated with real estate leases. These payments are recognized in operating expenses in the period incurred.

At December 31, 2025 and 2024, the Company had operating lease net ROU assets of $54 million and $20 million and associated lease liabilities of $56 million and $26 million, respectively, classified within other assets and other liabilities, respectively. Net lease expense was $57 million, $53 million, and $43 million in 2025, 2024 and 2023, respectively, including expenses associated with software leases.
The following table summarizes the components of operating lease costs and other information related to operating leases recorded within operating costs and other expenses, net of deferrals (dollars in millions):

Years Ended December 31,
202520242023
Lease Cost:
Operating leases (1)
$7 $7 $7 
Variable lease costs4 4 4 
Sublease income(3)(3)(3)
Net Lease Cost$8 $8 $8 
Other Information:
Cash paid for amounts included in the measurement of operating lease liability$9 $9 $10 
ROU assets obtained in exchange for new lease liabilities$48 $— $2 
Weighted average lease term8 years5 years5 years
Weighted average discount rate5.7 %4.2 %4.0 %
(1) Operating lease costs exclude software leases, as intangible assets are excluded from the scope of Accounting Standard Codification 842, Leases.

At December 31, 2025, the maturities of operating lease liabilities were as follows (in millions):

2026$11 
20279 
20288 
20297 
20307 
Thereafter37 
Total$79 
Less: interest23 
Present value of lease liabilities$56 

Historical Timeline

Fiscal YearFiled
2025Feb 24, 2026Showing above
2024Feb 26, 2025
2023Feb 28, 2024
2022Mar 1, 2023
2021Mar 7, 2022

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.

Other Available Disclosures

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