LEASES, OTHER COMMITMENTS AND CERTAIN CONTINGENCIES

12 Months Ended

May 31, 2026

Leases Other Commitments And Certain Contingencies Disclosure [Abstract]

LEASES, OTHER COMMITMENTS AND CERTAIN CONTINGENCIES

Leases

We have operating and finance leases that primarily relate to our data centers and real estate facilities. As of May 31, 2026, our leases substantially have remaining terms of one year to seventeen years, some of which include options to extend and/or terminate the leases.

The components of lease expense were as follows:


	Year Ended May 31,
(in millions)	2026		2025		2024
Operating lease cost	$	2,794	$	1,716	$	1,159
Finance lease cost:
Amortization of ROU assets	$	351	$	48	$	—
Interest on lease liabilities		279		38		—
Total finance lease cost	$	630	$	86	$	—

Supplemental balance sheet information related to leases was as follows:


	As of May 31,
(Dollars in millions)	2026		2025
Operating leases:
Operating lease ROU assets	$	29,690	$	13,145
Operating lease liabilities:
Operating lease liabilities, current	$	3,542	$	1,914
Operating lease liabilities, non-current		26,648		11,536
Total operating lease liabilities	$	30,190	$	13,450
Weighted average remaining lease term	12 years		10 years
Weighted average discount rate	5.7%		5.3%
Finance leases:
Finance lease ROU assets	$	7,464	$	2,874
Finance lease liabilities:
Finance lease liabilities, current	$	620	$	257
Finance lease liabilities, non-current		7,081		2,677
Total finance lease liabilities	$	7,701	$	2,934
Weighted average remaining lease term	14 years		15 years
Weighted average discount rate	5.7%		5.5%

Supplemental cash flow information related to leases was as follows:


	Year Ended May 31,
(in millions)	2026		2025		2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating leases	$	2,548	$	1,685	$	1,168
Finance leases	$	452	$	27	$	—
ROU assets obtained in exchange for lease obligations:
Operating leases	$	18,246	$	6,970	$	4,246
Finance leases	$	4,946	$	2,921	$	—

Maturities of lease liabilities were as follows as of May 31, 2026 (in millions):


	Operating Leases			Finance Leases
Fiscal 2027	$	3,712		$	656
Fiscal 2028		3,603			676
Fiscal 2029		3,550			697
Fiscal 2030		3,550			718
Fiscal 2031		3,519			740
Thereafter		23,933			7,973
Total lease payments		41,867			11,460
Less: imputed interest		(11,677	)		(3,759	)
Total lease liability	$	30,190		$	7,701

As of May 31, 2026, we had $260 billion of additional lease commitments, substantially all related to data center arrangements, that are generally expected to commence between the first quarter of fiscal 2027 and fiscal 2029 and for terms of fifteen to nineteen years that were not reflected on our consolidated balance sheet as of May 31, 2026 or in the maturities table above. These additional lease commitments include a lease for which we have guaranteed up to $3.3 billion of the lessor’s borrowing, which matures in September 2026.

Unconditional Obligations

In the ordinary course of business, we enter into certain unconditional purchase obligations with our suppliers. These are agreements that are enforceable and legally binding and specify terms, including: fixed or minimum quantities to be purchased; fixed, minimum or variable price provisions; and the approximate timing of the payment.

As of May 31, 2026, our unconditional purchase and certain other obligations, which were primarily related to data center power arrangements, were as follows (in millions):


Fiscal 2027	$	1,841
Fiscal 2028		1,034
Fiscal 2029		1,053
Fiscal 2030		952
Fiscal 2031		896
Thereafter		7,533
Total	$	13,309

As described in Note 6 above, as of May 31, 2026 we have senior notes and other borrowings that mature at various future dates and derivative financial instruments outstanding that we leverage to manage certain risks and exposures.

Subsequent to May 31, 2026, we entered into an additional $19 billion of unconditional purchase commitments for cloud infrastructure assets that commence in fiscal 2027 and have a term of five years.

Guarantees

Our cloud, software and hardware sales agreements generally include certain provisions for indemnifying customers against liabilities if our products infringe a third party’s intellectual property rights. To date, we have not incurred any material costs as a result of such indemnifications and have not accrued any material liabilities related to such obligations in our consolidated financial statements. Certain of our sales agreements also include provisions indemnifying customers against liabilities in the event we breach confidentiality or service level requirements. It is not possible to determine the maximum potential amount under these indemnification agreements due to our limited and infrequent history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement.