MOODYS CORP /DE/MCO

MOODYS CORP /DE/ Leases Disclosure

10-KFiled Feb 18, 20262 min read
LEASES
The Company has operating leases, substantially all of which relate to the lease of office space. The Company's leases which are classified as finance leases are not material to the consolidated financial statements. Certain of the Company's leases include options to renew, with renewal terms that can extend the lease term from one year to 20 years at the Company's discretion.
The following table presents the components of the Company’s lease cost:
Year ended December 31,
202520242023
Operating lease cost$88 $88 $93 
Sublease income(7)(7)(7)
Variable lease cost21 22 22 
Total lease cost$102 $103 $108 
During 2025, the Company recorded charges of $4 million related to the non-cash acceleration of amortization of ROU Assets that have been abandoned or for which abandonment is planned in future periods. During 2023, the Company recorded charges of $32 million related to the exit of certain real estate leases that resulted in ROU Asset impairment. These charges were recorded within restructuring expense in the consolidated statements of operations. Refer to Note 9 for further details.
The following tables present other information related to the Company’s operating leases:
Year ended December 31,
202520242023
Cash paid for amounts included in the measurement of operating lease liabilities$117 $120 $119 
Right-of-use assets obtained in exchange for new operating lease liabilities
$143 $21 $40 
December 31,
202520242023
Weighted-average remaining lease term (in years)
6.63.84.4
Weighted-average discount rate applied to operating leases
4.7 %3.2 %3.2 %
The following table presents a maturity analysis of the future minimum lease payments included within the Company’s operating lease liabilities at December 31, 2025:
Year Ending December 31,Operating Leases
2026$100 
202787 
202831 
202936 
203030 
Thereafter147 
Total lease payments (undiscounted)431 
Less: Interest74 
Present value of lease liabilities:$357 
Lease liabilities - current$95 
Lease liabilities - noncurrent$262 
In the fourth quarter of 2025, the Company entered into an operating lease for a new headquarters in New York City, for which the Company has not yet been granted access to the leased floors. Accordingly, the ROU Assets and operating lease liabilities at December 31, 2025 do not reflect the amounts for this lease. The future minimum lease payments for this lease are approximately $600 million and will commence in 2026 with a lease term of 17 years.

Historical Timeline

Fiscal YearFiled
2025Feb 18, 2026Showing above
2024Feb 14, 2025
2023Feb 14, 2024
2022Feb 15, 2023
2021Feb 22, 2022
2020Feb 22, 2021
2019Feb 24, 2020
2018Feb 25, 2019

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

Income TaxesRevenueEarnings Per ShareFair ValuePP&EGoodwill & IntangiblesSegmentsDebtCommitmentsStock CompensationNew StandardsPay vs Performance