LEASES
The net present value of finance and operating lease right-of-use assets and liabilities was as follows:
| | | | | | | | | | | | | | | | | | | | |
| | | | Year Ended December 31, |
| (in millions, except percentages) | | Location in the Consolidated Balance Sheets | | 2025 | | 2024 |
| | | | | | |
| Assets | | | | | | |
| Finance leases | | Property, plant, and equipment, net | | $ | — | | | $ | — | |
| Operating leases | | Operating lease right-of-use assets, net | | 139 | | | 136 | |
| Total right-of-use assets | | | | $ | 139 | | | $ | 136 | |
| | | | | | |
| Liabilities | | | | | | |
| Current liabilities | | | | | | |
| | | | | | |
| Operating leases | | Accrued liabilities | | 47 | | | 46 | |
| Noncurrent liabilities | | | | | | |
| Finance leases | | Long-term debt | | — | | | — | |
| Operating leases | | Operating lease liabilities | | 93 | | | 91 | |
| Total lease liabilities | | | | $ | 140 | | | $ | 137 | |
| | | | | | |
| Supplemental information: | | | | |
| Weighted-average discount rate | | | | |
| | | | | | |
| Operating leases | | | | 4.6 | % | | 4.1 | % |
| | | | | | |
| Weighted-average remaining lease term in years | | | | |
| | | | | | |
| Operating leases | | | | 4.0 | | 4.1 |
The lease costs recognized in the Consolidated Statements of Operations were as follows: | | | | | | | | | | | | | | | |
| | | Year Ended December 31, |
| (in millions) | | | 2025 | | 2024 |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| Operating lease cost | | | $ | 65 | | | $ | 67 | |
| | | | | |
| Variable lease cost | | | 17 | | | 16 | |
| Total lease cost | | | $ | 82 | | | $ | 83 | |
The contractual maturity dates of the remaining lease liabilities as of December 31, 2025 were as follows:
| | | | | | | | | | | | | | |
| (in millions) | | | | Operating Leases | | |
| | | | | | |
| 2026 | | | | $ | 52 | | | |
| 2027 | | | | 38 | | | |
| 2028 | | | | 26 | | | |
| 2029 | | | | 17 | | | |
| 2030 | | | | 9 | | | |
| 2031 and beyond | | | | 12 | | | |
| Total lease payments | | | | $ | 154 | | | |
| Less imputed interest | | | | 14 | | | |
| Present value of lease liabilities | | | | $ | 140 | | | |
The supplemental cash flow information for leases was as follows:
| | | | | | | | | | | | | | | | | | | | |
| | Year Ended December 31, |
| (in millions) | | 2025 | | 2024 | | 2023 |
| | | | | | |
| Cash paid for amounts included in the measurement of lease liabilities: | | | | | | |
| | | | | | |
| Operating cash flows paid for operating leases | | $ | 62 | | | $ | 67 | | | $ | 68 | |
| | | | | | |
| | | | | | |
| Right-of-use assets obtained in exchange for new lease liabilities (non-cash investing activity): | | | | | | |
| | | | | | |
| Operating leases | | 51 | | | 19 | | | 36 | |
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.