LEASES

12 Months Ended

Dec. 31, 2024

Leases [Abstract]

LEASES

LEASES

OPERATING LEASES.

As a lessee, the Company leases certain logistics, office, and manufacturing facilities, as well as vehicles and other equipment. Certain of the Company’s leases may include options to extend. Our ROU operating lease assets are recognized within Property, plant, and equipment – net in the Consolidated Statements of Financial Position. Our operating lease liabilities are recognized within All other current liabilities and All other non-current liabilities in the Consolidated Statements of Financial Position, as detailed below.

Operating Lease Assets and Liabilities	As of
	December 31, 2024		December 31, 2023
Operating lease ROU assets	$	364	$	356
Current operating lease liabilities	115		110
Non-current operating lease liabilities	270		273
Total operating lease liabilities	$	385	$	383

Operating Lease Expense	For the years ended December 31
	2024		2023		2022
Long-term (fixed)	$	134	$	121	$	115
Long-term (variable)	120		106		98
Short-term	4		2		4
Total operating lease expense	$	258	$	229	$	217

Maturity of Lease Liabilities
	2025		2026		2027		2028		2029		Thereafter		Total
Undiscounted lease payments	$	129	$	113	$	77	$	40	$	24	$	41	$	425
Less: imputed interest													40
Total lease liability as of December 31, 2024													$	385

Supplemental Information Related to Operating Leases	For the years ended December 31
	2024			2023			2022
Operating cash flows used for operating leases	$	138		$	130		$	113
Right-of-use assets obtained in exchange for new lease liabilities	147			154			98
Weighted-average remaining lease term (in years)	4.4			4.7			4.4
Weighted-average discount rate	4.5		%	4.4		%	3.8		%

FINANCE LEASES.

The Company leases equipment manufactured or sold by the Company to customers through sales-type leases. Sales-type leases are included in financing receivables and are recognized within All other current assets and All other non-current assets in the Consolidated Statements of Financial Position.

Finance lease income was $14 million, $13 million, and $12 million for the years ended December 31, 2024, 2023, and 2022, respectively, and is recognized within Other (income) expense – net in the Consolidated and Combined Statements of Income.

Net Investment in Finance Leases	As of
	December 31, 2024		December 31, 2023
Minimum lease payments receivable	$	242	$	236
Less: deferred income	(31)		(30)
Discounted lease receivable	211		206
Estimated unguaranteed residual value of leased assets, net of deferred income	10		11
Investment in finance leases, net of deferred income	$	221	$	217

Contractual Maturities
Due In	2025		2026		2027		2028		2029		Thereafter		Total
Minimum lease payments receivable	$	77	$	61	$	38	$	27	$	17	$	22	$	242

We expect actual maturities to differ from contractual maturities, primarily as a result of prepayments.

LEASES

LEASES

OPERATING LEASES.

As a lessee, the Company leases certain logistics, office, and manufacturing facilities, as well as vehicles and other equipment. Certain of the Company’s leases may include options to extend. Our ROU operating lease assets are recognized within Property, plant, and equipment – net in the Consolidated Statements of Financial Position. Our operating lease liabilities are recognized within All other current liabilities and All other non-current liabilities in the Consolidated Statements of Financial Position, as detailed below.

Operating Lease Assets and Liabilities	As of
	December 31, 2024		December 31, 2023
Operating lease ROU assets	$	364	$	356
Current operating lease liabilities	115		110
Non-current operating lease liabilities	270		273
Total operating lease liabilities	$	385	$	383

Operating Lease Expense	For the years ended December 31
	2024		2023		2022
Long-term (fixed)	$	134	$	121	$	115
Long-term (variable)	120		106		98
Short-term	4		2		4
Total operating lease expense	$	258	$	229	$	217

Maturity of Lease Liabilities
	2025		2026		2027		2028		2029		Thereafter		Total
Undiscounted lease payments	$	129	$	113	$	77	$	40	$	24	$	41	$	425
Less: imputed interest													40
Total lease liability as of December 31, 2024													$	385

Supplemental Information Related to Operating Leases	For the years ended December 31
	2024			2023			2022
Operating cash flows used for operating leases	$	138		$	130		$	113
Right-of-use assets obtained in exchange for new lease liabilities	147			154			98
Weighted-average remaining lease term (in years)	4.4			4.7			4.4
Weighted-average discount rate	4.5		%	4.4		%	3.8		%

FINANCE LEASES.

The Company leases equipment manufactured or sold by the Company to customers through sales-type leases. Sales-type leases are included in financing receivables and are recognized within All other current assets and All other non-current assets in the Consolidated Statements of Financial Position.

Finance lease income was $14 million, $13 million, and $12 million for the years ended December 31, 2024, 2023, and 2022, respectively, and is recognized within Other (income) expense – net in the Consolidated and Combined Statements of Income.

Net Investment in Finance Leases	As of
	December 31, 2024		December 31, 2023
Minimum lease payments receivable	$	242	$	236
Less: deferred income	(31)		(30)
Discounted lease receivable	211		206
Estimated unguaranteed residual value of leased assets, net of deferred income	10		11
Investment in finance leases, net of deferred income	$	221	$	217

Contractual Maturities
Due In	2025		2026		2027		2028		2029		Thereafter		Total
Minimum lease payments receivable	$	77	$	61	$	38	$	27	$	17	$	22	$	242

We expect actual maturities to differ from contractual maturities, primarily as a result of prepayments.