Seagate Technology Holdings plcSTX

Seagate Technology Holdings plc Leases Disclosure

10-KFiled Aug 1, 20252 min read
Leases
The Company is a lessee in several operating leases related to real estate facilities for warehouse, office and lab space.
The Company’s lease arrangements comprise operating leases with various expiration dates through 2068. The lease term includes the non-cancelable period of the lease, adjusted for options to extend or terminate the lease when it is reasonably certain that an option will be exercised.
During fiscal years 2024 and 2023, the Company sold and leased back certain properties and recorded a net gain of $30 million and $156 million respectively, within Restructuring and other, net in the Consolidated Statements of Operations.
Operating lease costs include short-term lease costs and are shown net of immaterial sublease income. The components of lease costs and other information related to leases were as follows:
 Fiscal Years Ended
(Dollars in millions)June 27,
2025		June 28,
2024		June 30,
2023
Operating lease cost$76 $72 $21 
Variable lease cost5 33
Total lease cost$81 $75 $24 
Operating cash outflows from operating leases$69 $63 $23 

During fiscal year 2025 the ROU assets obtained in exchange for new operating lease liabilities was not material. During fiscal years 2024 and 2023, the Company obtained $47 million and $353 million ROU assets in exchange for new operating lease liabilities, respectively.
June 27,
2025		June 28,
2024		June 30,
2023
Weighted-average remaining lease term7.7 years8.6 years9.6 years
Weighted-average discount rate8.55 %8.45 %8.49 %
ROU assets and lease liabilities included in the Company’s Consolidated Balance Sheets were as follows:
(Dollars in millions)Balance Sheet LocationJune 27,
2025		June 28,
2024
ROU assetsOther assets, net$353 $403 
Current lease liabilitiesAccrued expenses61 61
Non-current lease liabilitiesOther non-current liabilities317 338

At June 27, 2025, future lease payments included in the measurement of lease liabilities were as follows (in millions):
Fiscal YearAmount
2026$64 
202763 
202864 
202965 
203064 
Thereafter196 
Total lease payments516 
Less: imputed interest(138)
Present value of lease liabilities$378 

Historical Timeline

Fiscal YearFiled
2025Aug 1, 2025Showing above
2024Aug 2, 2024
2023Aug 4, 2023
2022Aug 5, 2022
2020Aug 7, 2020

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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