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Leases (Tables)

9 Months Ended

Oct. 30, 2020

Lease Cost, Cash Flow, Term and Discount Rate

The components of lease expense during the periods presented were as follows (table in millions):



	Three Months Ended				Nine Months Ended
	October 30,		November 1,		October 30,		November 1,
	2020		2019		2020		2019
Operating lease expense	$	47	$	42	$	137	$	122

Finance lease expense:
Amortization of ROU assets	$	2	$	2	$	5	$	3
Interest on lease liabilities	—		—		1		—
Total finance lease expense	$	2	$	2	$	6	$	3

Short-term lease expense	$	1	$	1	$	2	$	2

Variable lease expense	$	7	$	8	$	22	$	24
Total lease expense	$	57	$	53	$	167	$	151

Lease term and discount rate related to operating and finance leases as of the period presented were as follows:



	October 30,		January 31,
	2020		2020
Weighted-average remaining lease term (in years)
Operating leases	12.6		13.3
Finance leases	8.5		9.2
Weighted-average discount rate
Operating leases	3.5	%	3.8	%
Finance leases	2.9	%	3.1	%

Supplemental cash flow information related to operating and finance leases during the period presented was as follows (table in millions):



	Nine Months Ended
	October 30,		November 1,
	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	124	$	124
Operating cash flows from finance leases	1		1
Financing cash flows from finance leases	3		1
ROU assets obtained in exchange for lease liabilities:
Operating leases	$	256	$	205
Finance leases	1		63

Lease Assets and Liabilities

Supplemental balance sheet information related to operating and finance leases as of the period presented was as follows (table in millions):



	October 30, 2020
	Operating Leases		Finance Leases
ROU assets, non-current⁽¹⁾	$	1,026	$	54

Lease liabilities, current⁽²⁾	$	109	$	5
Lease liabilities, non-current⁽³⁾	904		50
Total lease liabilities	$	1,013	$	55



	January 31, 2020
	Operating Leases		Finance Leases
ROU assets, non-current⁽¹⁾	$	886	$	58

Lease liabilities, current⁽²⁾	$	109	$	4
Lease liabilities, non-current⁽³⁾	746		55
Total lease liabilities	$	855	$	59

⁽¹⁾ ROU assets for operating leases are included in other assets and ROU assets for finance leases are included in property and equipment, net on the condensed consolidated balance sheets.

⁽²⁾Current lease liabilities are included primarily in accrued expenses and other on the condensed consolidated balance sheets. An immaterial amount is presented in due from related parties, net on the condensed consolidated balance sheets.

⁽³⁾ Non-current operating lease liabilities are presented as operating lease liabilities on the condensed consolidated balance sheets. Non-current finance lease liabilities are included in other liabilities on the condensed consolidated balance sheets.

Operating Lease Liability Maturity

The following represents VMware’s future minimum lease payments under non-cancellable operating and finance leases as of the period presented (table in millions):



	October 30, 2020
	Operating Leases			Finance Leases
Remainder of 2021	$	28		$	2
2022	153			6
2023	162			7
2024	132			7
2025	104			6
Thereafter	728			34
Total future minimum lease payments	1,307			62
Less: Imputed interest	(294		)	(7		)
Total lease liabilities⁽¹⁾	$	1,013		$	55

⁽¹⁾ Total lease liabilities as of October 30, 2020 excluded legally binding lease payments for leases signed but not yet commenced of $81 million.

Finance Lease Liability Maturity

The following represents VMware’s future minimum lease payments under non-cancellable operating and finance leases as of the period presented (table in millions):



	October 30, 2020
	Operating Leases			Finance Leases
Remainder of 2021	$	28		$	2
2022	153			6
2023	162			7
2024	132			7
2025	104			6
Thereafter	728			34
Total future minimum lease payments	1,307			62
Less: Imputed interest	(294		)	(7		)
Total lease liabilities⁽¹⁾	$	1,013		$	55

⁽¹⁾ Total lease liabilities as of October 30, 2020 excluded legally binding lease payments for leases signed but not yet commenced of $81 million.