Leases

12 Months Ended

Jun. 30, 2022

LEASES

Lessee Arrangements

The following amounts were recorded in the Company's Balance Sheet relating to its operating leases and other supplemental information:


	For the years ended June 30,
	2022			2021
	(in millions)
ROU assets	$	477		$	469
Lease liabilities
Current lease liabilities	$	107		$	92
Non-current lease liabilities	405			409
Total lease liabilities	$	512		$	501
Other supplemental information
Weighted average remaining lease term	9 years			8 years
Weighted average discount rate	3		%	3		%

The following table presents information about the Company's lease costs and supplemental cash flows information for leases:


	For the years ended June 30,
	2022		2021		2020
	(in millions)
Lease costs
Total lease costs(a)	$	128	$	126	$	126
Supplemental cash flows information
Operating cash flows from operating leases	$	116	$	134	$	166
ROU assets obtained in exchange for operating lease liabilities	$	137	$	49	$	87


(a)			Total lease costs of $128 million, $126 million and $126 million for the years ended June 30, 2022, 2021 and 2020 are net of sublease income of approximately $15 million, $30 million and $50 million, respectively. Approximately $15 million and $40 million of the sublease income for the years ended June 30, 2021 and 2020, respectively, relates to office facilities that were subleased through November 2020 to News Corporation, a related party (see Note 13—Related Party Transactions).

The following table presents the lease payments relating to the Company's operating leases:


	As of June 30, 2022
	(in millions)
Fiscal Year
2023	$	119
2024	116
2025	104
2026	57
2027	29
Thereafter	181
Total lease payments	606
Less: imputed interest	(94)
Present value of operating lease liabilities	$	512

Lessor Arrangements

The Company's lessor arrangements primarily relate to its owned production and office facilities at the FOX Studio Lot, which is located in Los Angeles, California. The Company is responsible for the management of the FOX Studio Lot, which includes managing and providing facilities, studio operations, and production services. The Company leases production and office space on the FOX Studio Lot to 21CF for an initial term of seven years, subject to two five-year renewal options exercisable by 21CF. As a result, the FOX Studio Lot will predominantly be utilized by Disney productions until 2026. The Company will receive approximately $50 million annually in lease payments over the remaining lease term.

The Company recorded total lease income of approximately $60 million, $50 million, and $55 million for fiscal 2022, 2021 and 2020 respectively, which is included in Revenues in the Statements of Operations. The Company recognizes lease payments for operating leases as revenue on a straight-line basis over the lease term and variable lease payments as revenue in the period incurred.