LEASE COMMITMENTS

6 Months Ended

Jan. 03, 2020

NOTE 19: LEASE COMMITMENTS

As discussed in Note 2: Accounting Changes or Recent Accounting Pronouncements, we adopted ASC 842 effective June 29, 2019. Our operating and finance leases at January 3, 2020 were for real estate such as office space, warehouses, manufacturing, research and development facilities, tower space and land, and for equipment. Finance leases were not material at January 3, 2020 and are not included in the disclosures below.

Operating lease cost was $88 million for the two quarters ended January 3, 2020. Other lease expenses, including short-term and equipment lease cost, variable lease cost and sublease income, were not material for the two quarters ended January 3, 2020.

Supplemental operating lease balance sheet information at January 3, 2020 is as follows:



	(In millions)
Operating lease right-of-use assets	$	837

Other accrued items	129
Operating lease liabilities	781
Total operating lease liabilities	$	910

Other supplemental lease information for the two quarters ended January 3, 2020 is as follows:



	(In millions, except lease term and discount rate)
Cash paid for amounts included in the measurement of operating lease liabilities	$	91
Right-of-use assets obtained in exchange for new operating lease liabilities	17
Weighted average remaining lease term — operating leases (in years)	9.4
Weighted average discount rate — operating leases	3.1		%

Future lease payments under non-cancelable operating leases at January 3, 2020 were as follows:



	(In millions)
Fiscal Years
2020	$	162
2021	134
2022	123
2023	103
2024	86
Thereafter	450
Total future lease payments required	1,058
Less: imputed interest	148
Total	$	910

These commitments do not contain any material rent escalations, rent holidays, contingent rent, rent concessions, leasehold improvement incentives or unusual provisions or conditions. We do not consider any individual lease material to our operations. At January 3, 2020, we had $280 million of additional operating lease commitments for real estate leases that have not yet commenced. These leases will commence in 2021 with lease terms of 15 to 25 years.

As discussed in Note 2: Accounting Changes or Recent Accounting Pronouncements in these Notes, we adopted ASC 842 using the optional transition method and, consequently, we are presenting prior period amounts and disclosures under ASC 840. Future minimum lease payments for operating leases under ASC 840 at June 28, 2019 were as follows:



	(In millions)

June 29, 2019 to July 3, 2020	$	68
July 4, 2020 to July 2, 2021	62
July 3, 2021 to July 1, 2022	47
July 2, 2022 to June 30, 2023	40
July 1, 2023 to June 28, 2024	32
Thereafter	64
Total minimum lease payments required	$	313

Rent expense was $73 million, $61 million and $65 million for fiscal 2019, 2018 and 2017, respectively.