Leases

12 Months Ended

Dec. 31, 2025

Lease agreements primarily cover office facilities and machinery and equipment and expire at various dates. Leases, predominantly operating leases, are included in Other assets and Other liabilities on the Consolidated Balance Sheets. The lease agreements do not contain significant residual value guarantees, restrictions or covenants.

Operating lease right of use assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. The discount rate used to determine the commencement date present value of lease payments is typically the applicable secured borrowing rate, as most of the leases do not provide an implicit rate. The operating lease right of use asset was $301 million and $320 million and the operating lease liability was $375 million and $406 million at December 31, 2025 and 2024.

Total lease expense was $77 million, $79 million and $87 million for the years ended December 31, 2025, 2024 and 2023 which includes operating lease expense of $53 million, $51 million and $58 million, variable lease expense of $20 million, $23 million and $24 million and short-term lease expense of $4 million, $5 million and $5 million. Cash paid for amounts included in operating lease liabilities was $59 million, $80 million and $60 million for years ended December 31,

2025, 2024 and 2023. Operating lease right of use assets obtained in exchange for lease obligations was $27 million, $73 million and $39 million for the years ended December 31, 2025, 2024 and 2023.

The table below presents the maturities of lease liabilities:


	Operating
As of December 31, 2025	Leases
(In millions)

2026	$	55
2027	55
2028	50
2029	51
2030	47
Thereafter	255
Total	513
Less: discount	138
Total lease liabilities	$	375

The table below presents the weighted average remaining lease term for operating leases and weighted average discount rate used in calculating the operating lease asset and liability.


As of December 31, 2025

Weighted average remaining lease term	10.1 years
Weighted average discount rate	4.2	%