LEASES

3 Months Ended

Sep. 30, 2018

Leases [Abstract]

LEASES

NOTE 13 — LEASES

We have operating and finance leases for datacenters, corporate offices, research and development facilities, retail stores, and certain equipment. Our leases have remaining lease terms of 1 year to 20 years, some of which include options to extend the leases for up to 5 years, and some of which include options to terminate the leases within 1 year.

The components of lease expense were as follows:

(In millions)
Three Months Ended September 30,		2018		2017
Operating lease cost	$	410	$	388
Finance lease cost:
Amortization of right-of-use assets	$	78	$	48
Interest on lease liabilities		55		30
Total finance lease cost	$	133	$	78

Supplemental cash flow information related to leases was as follows:

(In millions)
Three Months Ended September 30,		2018		2017
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	397	$	369
Operating cash flows from finance leases		55		30
Financing cash flows from finance leases		47		25
Right-of-use assets obtained in exchange for lease obligations:
Operating leases		496		391
Finance leases		419		728

Supplemental balance sheet information related to leases was as follows:

(In millions, except lease term and discount rate)
	September 30, 2018			June 30, 2018
Operating Leases
Operating lease right-of-use assets	$	6,734		$	6,686
Other current liabilities	$	1,372		$	1,399
Operating lease liabilities		5,652			5,568
Total operating lease liabilities	$	7,024		$	6,967
Finance Leases
Property and equipment, at cost	$	4,955		$	4,543
Accumulated depreciation		(481	)		(404	)
Property and equipment, net	$	4,474		$	4,139
Other current liabilities	$	203		$	176
Other long-term liabilities		4,471			4,125
Total finance lease liabilities	$	4,674		$	4,301
Weighted Average Remaining Lease Term
Operating leases		7 years			7 years
Finance leases		13 years			13 years
Weighted Average Discount Rate
Operating leases		2.8%			2.7%
Finance leases		5.1%			5.2%

Maturities of lease liabilities were as follows:

(In millions)
Year Ending June 30,	Operating Leases			Finance Leases
2019 (excluding the three months ended September 30, 2018)	$	1,170		$	314
2020		1,422			426
2021		1,154			434
2022		958			442
2023		786			444
Thereafter		2,290			4,434
Total lease payments		7,780			6,494
Less imputed interest		(756	)		(1,820	)
Total	$	7,024		$	4,674

As of September 30, 2018, we have additional operating and finance leases, primarily for datacenters, that have not yet commenced of $2.6 billion and $4.8 billion, respectively. These operating and finance leases will commence between fiscal year 2019 and fiscal year 2022 with lease terms of 1 year to 15 years.