Leases (Tables)

6 Months Ended

Jun. 30, 2019

Leases [Abstract]

Operating lease assets and liabilities

PMI’s operating leases at June 30, 2019 were as follows:

(in millions)	June 30, 2019
Assets:
Other assets	$	710
Liabilities:
Current
Accrued liabilities - Other	$	184
Noncurrent
Income taxes and other liabilities	524
Total lease liabilities	$	708

Operating lease liability maturity

Maturity of PMI’s operating lease liabilities, on an undiscounted basis, as of June 30, 2019, were as follows (as calculated under the new guidance ASC 842 (Leases)):

(in millions)	Total
2019	$	117
2020	177
2021	132
2022	94
2023	69
Thereafter	319
Total lease payments	908
Less: Interest	200
Present value of lease liabilities	$	708

Lease cost components

The components of PMI’s lease cost were as follows for the six months and three months ended June 30, 2019:

(in millions)	For the Six Months Ended June 30, 2019		For the Three Months Ended June 30, 2019
Operating lease cost	$	119	$	59
Short-term lease cost	30		18
Variable lease cost	10		2
Total lease cost	$	159	$	79

For the six months ended June 30, 2019, lease cost of $38 million were recorded in cost of sales and $121 million were recorded in marketing, administration and research cost. For the three months ended June 30, 2019, lease costs of $19 million were recorded in cost of sales and $60 million were recorded in marketing, administration and research cost.

Minimum rental commitments under non-cancelable operating leases in effect at December 31, 2018

Minimum rental commitments under non-cancelable operating leases in effect at December 31, 2018, were as follows (as calculated under legacy guidance ASC 840 (Leases)):

(in millions)	Total
2019	$	147
2020	103
2021	73
2022	52
2023	43
Thereafter	354
	$	772

Other lease information

Other information related to PMI’s operating leases were as follows for the six months ended June 30, 2019:

(in millions)	June 30, 2019
Cash paid for amounts included in the measurement of lease liabilities in Operating cash flows	$	121
Leased assets obtained in exchange for new operating lease liabilities	$	98
Weighted-average remaining lease term (years)	10.3
Weighted-average discount rate(1)	4.7		%

⁽¹⁾ PMI’s weighted-average discount rate is based on its estimated pre-tax cost of debt adjusted for country-specific risk.