LEASES

12 Months Ended

Dec. 31, 2022

Leases [Abstract]

LEASES

LEASES

Leases as Lessor

The components of revenue from leases were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Operating leases
Lease income related to ChoiceLease	$	1,490	$	1,538	$	1,566
Lease income related to commercial rental (1)	1,286		1,062		792
Sales-type leases
Interest income related to net investment in leases	$	45	$	48	$	49
Variable lease income excluding commercial rental (1)	$	323	$	312	$	289

_______________ 

(1)Lease income related to commercial rental includes both fixed and variable lease income. Variable lease income is approximately 15% to 25% of total commercial rental income.

The components of the net investment in sales-type leases, which are included in "Receivables, net" and "Sales-type leases and other assets" in the Consolidated Balance Sheets, were as follows:

	December 31,
(In millions)	2022		2021
Net investment in the lease - lease payment receivable	$	598	$	583
Net investment in the lease - unguaranteed residual value in assets	43		47
	641		630
Estimated loss allowance	(6)		(4)
Total	$	635	$	626

Maturities of sales-type lease receivables as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	163
2024	148
2025	128
2026	111
2027	79
Thereafter	111
Total undiscounted cash flows	740
Present value of lease payments (recognized as lease receivables)	(598)
Difference between undiscounted cash flows and discounted cash flows	$	142

Operating lease payments expected to be received as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	1,112
2024	842
2025	596
2026	376
2027	204
Thereafter	148
Total undiscounted cash flows	$	3,278

Leases as Lessee

The components of lease expense were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Finance lease cost
Amortization of right-of-use-assets	$	13	$	14	$	13
Interest on lease liabilities	2		2		2
Operating lease cost	199		98		92
Short-term lease and other	10		9		8
Variable lease cost	26		16		13
Sublease income	(39)		(27)		(27)
Total lease cost	$	211	$	112	$	101

Supplemental balance sheet information related to leases was as follows:

	December 31,
	2022				2021
(In millions)	Operating		Finance		Operating		Finance
Noncurrent assets	$	715	$	38	$	341	$	40
Current liabilities	191		13		100		13
Noncurrent liabilities	541		29		256		31

	December 31,
	2022		2021
Weighted-average remaining lease term
Operating	5 years		5 years
Finance	4 years		4 years
Weighted-average discount rate
Operating	4.0	%	2.7	%
Finance	4.4	%	4.4	%

Maturities of operating and finance lease liabilities were as follows:

(In millions)	Operating		Finance
Years ending December 31	Leases		Leases		Total
2023	$	216	$	14	$	230
2024	177		12		189
2025	152		8		160
2026	112		5		117
2027	68		2		70
Thereafter	79		5		84
Total lease payments	804		46		850
Less: Imputed Interest	(72)		(4)		(76)
Present value of lease liabilities	$	732	$	42	$	774

Note: Amounts may not be additive due to rounding.

As of December 31, 2022, we have entered into $214 million of additional facility operating leases that have not yet commenced. The operating leases will commence in 2022 with lease terms of generally 3 to 10 years.

LEASES

LEASES

Leases as Lessor

The components of revenue from leases were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Operating leases
Lease income related to ChoiceLease	$	1,490	$	1,538	$	1,566
Lease income related to commercial rental (1)	1,286		1,062		792
Sales-type leases
Interest income related to net investment in leases	$	45	$	48	$	49
Variable lease income excluding commercial rental (1)	$	323	$	312	$	289

_______________ 

(1)Lease income related to commercial rental includes both fixed and variable lease income. Variable lease income is approximately 15% to 25% of total commercial rental income.

The components of the net investment in sales-type leases, which are included in "Receivables, net" and "Sales-type leases and other assets" in the Consolidated Balance Sheets, were as follows:

	December 31,
(In millions)	2022		2021
Net investment in the lease - lease payment receivable	$	598	$	583
Net investment in the lease - unguaranteed residual value in assets	43		47
	641		630
Estimated loss allowance	(6)		(4)
Total	$	635	$	626

Maturities of sales-type lease receivables as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	163
2024	148
2025	128
2026	111
2027	79
Thereafter	111
Total undiscounted cash flows	740
Present value of lease payments (recognized as lease receivables)	(598)
Difference between undiscounted cash flows and discounted cash flows	$	142

Operating lease payments expected to be received as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	1,112
2024	842
2025	596
2026	376
2027	204
Thereafter	148
Total undiscounted cash flows	$	3,278

Leases as Lessee

The components of lease expense were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Finance lease cost
Amortization of right-of-use-assets	$	13	$	14	$	13
Interest on lease liabilities	2		2		2
Operating lease cost	199		98		92
Short-term lease and other	10		9		8
Variable lease cost	26		16		13
Sublease income	(39)		(27)		(27)
Total lease cost	$	211	$	112	$	101

Supplemental balance sheet information related to leases was as follows:

	December 31,
	2022				2021
(In millions)	Operating		Finance		Operating		Finance
Noncurrent assets	$	715	$	38	$	341	$	40
Current liabilities	191		13		100		13
Noncurrent liabilities	541		29		256		31

	December 31,
	2022		2021
Weighted-average remaining lease term
Operating	5 years		5 years
Finance	4 years		4 years
Weighted-average discount rate
Operating	4.0	%	2.7	%
Finance	4.4	%	4.4	%

Maturities of operating and finance lease liabilities were as follows:

(In millions)	Operating		Finance
Years ending December 31	Leases		Leases		Total
2023	$	216	$	14	$	230
2024	177		12		189
2025	152		8		160
2026	112		5		117
2027	68		2		70
Thereafter	79		5		84
Total lease payments	804		46		850
Less: Imputed Interest	(72)		(4)		(76)
Present value of lease liabilities	$	732	$	42	$	774

Note: Amounts may not be additive due to rounding.

As of December 31, 2022, we have entered into $214 million of additional facility operating leases that have not yet commenced. The operating leases will commence in 2022 with lease terms of generally 3 to 10 years.

LEASES

LEASES

Leases as Lessor

The components of revenue from leases were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Operating leases
Lease income related to ChoiceLease	$	1,490	$	1,538	$	1,566
Lease income related to commercial rental (1)	1,286		1,062		792
Sales-type leases
Interest income related to net investment in leases	$	45	$	48	$	49
Variable lease income excluding commercial rental (1)	$	323	$	312	$	289

_______________ 

(1)Lease income related to commercial rental includes both fixed and variable lease income. Variable lease income is approximately 15% to 25% of total commercial rental income.

The components of the net investment in sales-type leases, which are included in "Receivables, net" and "Sales-type leases and other assets" in the Consolidated Balance Sheets, were as follows:

	December 31,
(In millions)	2022		2021
Net investment in the lease - lease payment receivable	$	598	$	583
Net investment in the lease - unguaranteed residual value in assets	43		47
	641		630
Estimated loss allowance	(6)		(4)
Total	$	635	$	626

Maturities of sales-type lease receivables as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	163
2024	148
2025	128
2026	111
2027	79
Thereafter	111
Total undiscounted cash flows	740
Present value of lease payments (recognized as lease receivables)	(598)
Difference between undiscounted cash flows and discounted cash flows	$	142

Operating lease payments expected to be received as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	1,112
2024	842
2025	596
2026	376
2027	204
Thereafter	148
Total undiscounted cash flows	$	3,278

Leases as Lessee

The components of lease expense were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Finance lease cost
Amortization of right-of-use-assets	$	13	$	14	$	13
Interest on lease liabilities	2		2		2
Operating lease cost	199		98		92
Short-term lease and other	10		9		8
Variable lease cost	26		16		13
Sublease income	(39)		(27)		(27)
Total lease cost	$	211	$	112	$	101

Supplemental balance sheet information related to leases was as follows:

	December 31,
	2022				2021
(In millions)	Operating		Finance		Operating		Finance
Noncurrent assets	$	715	$	38	$	341	$	40
Current liabilities	191		13		100		13
Noncurrent liabilities	541		29		256		31

	December 31,
	2022		2021
Weighted-average remaining lease term
Operating	5 years		5 years
Finance	4 years		4 years
Weighted-average discount rate
Operating	4.0	%	2.7	%
Finance	4.4	%	4.4	%

Maturities of operating and finance lease liabilities were as follows:

(In millions)	Operating		Finance
Years ending December 31	Leases		Leases		Total
2023	$	216	$	14	$	230
2024	177		12		189
2025	152		8		160
2026	112		5		117
2027	68		2		70
Thereafter	79		5		84
Total lease payments	804		46		850
Less: Imputed Interest	(72)		(4)		(76)
Present value of lease liabilities	$	732	$	42	$	774

Note: Amounts may not be additive due to rounding.

As of December 31, 2022, we have entered into $214 million of additional facility operating leases that have not yet commenced. The operating leases will commence in 2022 with lease terms of generally 3 to 10 years.

LEASES

LEASES

Leases as Lessor

The components of revenue from leases were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Operating leases
Lease income related to ChoiceLease	$	1,490	$	1,538	$	1,566
Lease income related to commercial rental (1)	1,286		1,062		792
Sales-type leases
Interest income related to net investment in leases	$	45	$	48	$	49
Variable lease income excluding commercial rental (1)	$	323	$	312	$	289

_______________ 

(1)Lease income related to commercial rental includes both fixed and variable lease income. Variable lease income is approximately 15% to 25% of total commercial rental income.

The components of the net investment in sales-type leases, which are included in "Receivables, net" and "Sales-type leases and other assets" in the Consolidated Balance Sheets, were as follows:

	December 31,
(In millions)	2022		2021
Net investment in the lease - lease payment receivable	$	598	$	583
Net investment in the lease - unguaranteed residual value in assets	43		47
	641		630
Estimated loss allowance	(6)		(4)
Total	$	635	$	626

Maturities of sales-type lease receivables as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	163
2024	148
2025	128
2026	111
2027	79
Thereafter	111
Total undiscounted cash flows	740
Present value of lease payments (recognized as lease receivables)	(598)
Difference between undiscounted cash flows and discounted cash flows	$	142

Operating lease payments expected to be received as of December 31, 2022 were as follows:

Years ending December 31	(In millions)
2023	$	1,112
2024	842
2025	596
2026	376
2027	204
Thereafter	148
Total undiscounted cash flows	$	3,278

Leases as Lessee

The components of lease expense were as follows:

	Years ended December 31,
(In millions)	2022		2021		2020
Finance lease cost
Amortization of right-of-use-assets	$	13	$	14	$	13
Interest on lease liabilities	2		2		2
Operating lease cost	199		98		92
Short-term lease and other	10		9		8
Variable lease cost	26		16		13
Sublease income	(39)		(27)		(27)
Total lease cost	$	211	$	112	$	101

Supplemental balance sheet information related to leases was as follows:

	December 31,
	2022				2021
(In millions)	Operating		Finance		Operating		Finance
Noncurrent assets	$	715	$	38	$	341	$	40
Current liabilities	191		13		100		13
Noncurrent liabilities	541		29		256		31

	December 31,
	2022		2021
Weighted-average remaining lease term
Operating	5 years		5 years
Finance	4 years		4 years
Weighted-average discount rate
Operating	4.0	%	2.7	%
Finance	4.4	%	4.4	%

Maturities of operating and finance lease liabilities were as follows:

(In millions)	Operating		Finance
Years ending December 31	Leases		Leases		Total
2023	$	216	$	14	$	230
2024	177		12		189
2025	152		8		160
2026	112		5		117
2027	68		2		70
Thereafter	79		5		84
Total lease payments	804		46		850
Less: Imputed Interest	(72)		(4)		(76)
Present value of lease liabilities	$	732	$	42	$	774

Note: Amounts may not be additive due to rounding.

As of December 31, 2022, we have entered into $214 million of additional facility operating leases that have not yet commenced. The operating leases will commence in 2022 with lease terms of generally 3 to 10 years.