L3HARRIS TECHNOLOGIES, INC. /DE/LHX

L3HARRIS TECHNOLOGIES, INC. /DE/ Leases Disclosure

10-KFiled Feb 12, 20262 min read
NOTE 11: LEASES
Our operating and finance leases primarily consist of real estate leases for office space, warehouses, manufacturing, R&D facilities, telecommunication tower space and land and equipment leases.
Lease Costs. Components of lease costs included in our Consolidated Statement of Operations are as follows:
Fiscal Year
(In millions)202520242023
Operating lease cost$172 $164 $163 
Other, net(1)
75 75 60 
Total lease cost$247 $239 $223 
______________
(1) Includes short-term and equipment lease costs, variable lease costs, finance lease amortization, interest costs and sublease income.
Balance Sheet. ROU assets and lease liabilities included in our Consolidated Balance Sheet are as follows:
January 2, 2026January 3, 2025
(In millions)Operating FinanceOperatingFinance
ROU assets$717 $192 $684 $202 
Current lease liabilities132 10 150 32 
Non-current lease liabilities653 221 650 206 
Total lease liabilities$785 $231 $800 $238 
Supplemental Lease Information. Other supplemental lease information is as follows:
Fiscal Year
(In millions)
20252024
Net cash provided by operating activities - operating lease payments$178 $182 
ROU assets obtained in exchange for new operating lease obligations215 96 
Fiscal Year
20252024
Operating FinanceOperatingFinance
Weighted average remaining lease term7.51 years17.66 years7.59 years16.41 years
Weighted average discount rate4.84 %4.23 %3.72 %4.43 %
Maturities of operating and finance lease liabilities as of January 2, 2026 were as follows:
January 2, 2026
(In millions)OperatingFinance
2026$174 $19 
2027153 18 
2028133 19 
2029114 19 
203095 42 
Thereafter287 193 
Total future lease payments
956 310 
Less: imputed interest171 79 
Present value of lease liabilities$785 $231 
On January 2, 2026, we had additional future payments of $1.1 billion related to leases that have not yet commenced. These leases will commence between 2026 and 2028 and have lease terms of 7 years to 20 years. Of this amount, approximately $700 million pertains to a lease associated with the expansion of our large solid rocket motor production facility in Camden, Arkansas. This lease is expected to commence in January 2028, upon completion of construction, with a lease term of 20 years.
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Historical Timeline

Fiscal YearFiled
2026Feb 12, 2026Showing above
2025Feb 14, 2025
2023Feb 20, 2024
2022Feb 24, 2023
2021Mar 1, 2021
2019Aug 22, 2019
2018Aug 27, 2018
2017Aug 29, 2017
2016Aug 29, 2016

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.

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