LEASES

12 Months Ended

Dec. 30, 2023

LEASES

LEASES

NOTE 5  LEASES

The Company’s operating leases consist of offices and vehicles and the lease term varies between 3-7 years. Some of the Company’s leases include options to extend the lease term for periods of up to five years each. For purposes of calculating lease liabilities, lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise such options.

During 2023 and 2022, the Company has entered into new, non-cancellable, operating lease agreements of offices and vehicles.

Lease expenses for operating lease payments are recognized on a straight-line basis over the lease term. Certain operating leases provide for annual increases to lease payments based on an index or a rate. The Company calculates the present value of future lease payments based on the index or rate at the lease commencement date. Differences between the estimated lease liability and actual payments are expensed as incurred and are not material for all periods presented. The lease agreements generally do not contain any residual value guarantees or restrictive covenants.

Operating lease expense for the years ended December 30, 2023, December 31, 2022, and December 25, 2021 were $19 million, $13 million, and $11 million, respectively. The Company does not have any finance leases.

The balances for the operating leases, which are presented on the consolidated balance sheets in other long-term assets, other current liabilities and long-term liabilities, were as follows:

	As of
	December 30,		December 31,
U.S. dollars in millions	2023		2022
Operating lease right-of-use assets	$	49	$	57
Operating lease liabilities:
Current portion of lease liabilities		12		13
Long-term lease liabilities		39		45
Total operating lease liabilities	$	51	$	58

As of December 30, 2023 and December 31, 2022, the weighted average remaining lease term was 4.67 and 5.45 years, respectively, and the weighted average discount rate was 4.67% and 4.24%, respectively.

Supplemental information related to operating leases was as follows:

	Year ended
	December 30,		December 31,		December 25,
U.S. dollars in millions	2023		2022		2021
Operating cash outflows from operating leases	$	16	$	12	$	12
Right-of-use assets recognized in exchange for lease obligations	$	8	$	48	$	4

Maturities of operating lease liabilities were as follows:

	December 30,
U.S. Dollars in millions	2023
2024	$	14
2025		13
2026		10
2027		9
2028 and thereafter		10
Total operating lease payments		56
Imputed interest		(5)
Present value of lease liabilities	$	51

During 2017, the Company obtained the right to use land in Jerusalem from the Israeli government for the construction of a new research and development and innovation center that will also host the Company’s headquarters (the new Jerusalem Campus). This land lease was fully prepaid and no lease liability was recorded. This operating lease right of use asset is carried at cost and amortized using the straight-line method. This operating lease right of use asset, net of amortization, was $12 million and $11 million as of December 30, 2023 and December 31, 2022, respectively, and is included in other long-term assets on the consolidated balance sheets.