Leases

12 Months Ended

Dec. 31, 2023

We lease our corporate headquarters, which includes approximately 151,000 square feet of executive offices, R&D, and business operations, in Hayward, California. We also lease approximately 109,000 square feet of office space in Brisbane, California. Both leases: are non-cancelable; extend through 2031; have two options, at our sole discretion, to extend each lease term for a period of eight years; and require monthly lease payments that are subject to annual increases throughout the lease term.

Our sublease of approximately 31,000 square feet of our Brisbane office to another company commenced in October 2023. This sublease included a tenant improvement allowance to be paid by us of $9 million, of which approximately $1 million was outstanding at December 31, 2023. Under the terms of the agreement, we will receive sublease payments of approximately $3 million per year, beginning in 2024. For the year ended December 31, 2023, we recorded gross sublease income of $1 million. Income from the sublease is recognized on a straight-line basis as reduction of rent expense within G&A. This sublease is non-cancelable and extends through 2028, with the sublessee having options to extend the lease term.

At December 31, 2023 and 2022, our lease portfolio had a weighted average remaining term of 8 years and 9 years, respectively, and a weighted average discount rate of 5.2% for both periods.

The following table summarizes information related to our leases, all of which are classified as operating (in millions):


	As of December 31,
Location in Consolidated Balance Sheets	2023		2022
Assets:
Other noncurrent assets - right-of-use assets	$	92	$	100
Liabilities:
Other current liabilities - net current operating lease liabilities	$	11	$	3
Other noncurrent liabilities - noncurrent operating lease liabilities	$	110	$	117

For the years ended December 31, 2023, 2022 and 2021, we incurred lease expense of $18 million, $18 million, and $7 million, respectively. Lease costs include rent expense, which consists primarily of our proportionate share of operating expenses, property taxes, and insurance which we have elected to include in lease costs.

The following table summarizes our cash and non-cash information related to our operating leases (in millions):


	Year Ended December 31,
	2023		2022		2021
Cash paid for amounts included in measurement of lease liabilities	$	15	$	11	$	5
Cash received from tenant improvement allowances	$	9	$	8	$	3
Right-of-use assets obtained in exchange for new operating lease liabilities	$	—	$	3	$	95
Recognition of tenant improvement allowance receivable included in Other current liabilities	$	4	$	6	$	11

The following table summarizes our future minimum lease payments at December 31, 2023 (in millions):


Year Ending December 31,	Operating Leases
2024	$	17
2025	17
2026	17
2027	18
2028	19
Thereafter	61
Total undiscounted future minimum lease payments	$	149
Less: Imputed interest	(28)
Total present value of lease liabilities	$	121

As of December 31, 2023, we have provided deposits for letters of credit totaling $3 million to secure our obligations under our leases, which are included in Other noncurrent assets on the Consolidated Balance Sheet.