Leases

12 Months Ended

Dec. 31, 2023

Leases [Abstract]

Leases

Note 16 – Leases

Lessee

We are a lessee for non-cancelable operating and financing leases for cell sites, switch sites, retail stores, network equipment and office facilities with contractual terms that generally extend through 2035. The majority of cell site leases have a non-cancelable term of five to 15 years with several renewal options that can extend the lease term for five to 50 years. In addition, we have financing leases for network equipment that generally have a non-cancelable lease term of three to five years. The financing leases do not have renewal options and contain a bargain purchase option at the end of the lease.

The components of lease expense were as follows:

	Year Ended December 31,
(in millions)	2023		2022		2021
Operating lease expense	$	4,987	$	6,514	$	5,921
Financing lease expense:
Amortization of right-of-use assets	684		733		738
Interest on lease liabilities	79		68		69
Total financing lease expense	763		801		807
Variable lease expense	411		484		429
Total lease expense	$	6,161	$	7,799	$	7,157

Information relating to the lease term and discount rate is as follows:

	Year Ended December 31,
	2023		2022		2021
Weighted-Average Remaining Lease Term (Years)
Operating leases	9		10		9
Financing leases	2		2		3
Weighted-Average Discount Rate
Operating leases	4.3	%	4.1	%	3.6	%
Financing leases	4.6	%	3.2	%	2.5	%

Maturities of lease liabilities as of December 31, 2023, were as follows:

(in millions)	Operating Leases		Finance Leases
Twelve Months Ending December 31,
2024	$	4,829	$	1,324
2025	4,380		836
2026	4,048		392
2027	3,733		35
2028	3,410		14
Thereafter	18,634		3
Total lease payments	39,034		2,604
Less: imputed interest	7,239		108
Total	$	31,795	$	2,496

Interest payments for financing leases were $79 million, $68 million and $69 million for the years ended December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, we have additional operating leases for commercial properties that have not yet commenced with future lease payments of approximately $70 million.

As of December 31, 2023, we were contingently liable for future ground lease payments related to certain tower obligations. These contingent obligations are not included in the above table as the amounts owed are contractually owed by CCI based on the subleasing arrangement. See Note 9 – Tower Obligations for further information.

Lessor

The components of leased wireless devices under our Leasing Programs were as follows:

(in millions)	Average Remaining Useful Life	December 31, 2023		December 31, 2022
Leased wireless devices, gross	8 months	$	400	$	1,415
Accumulated depreciation		(285)		(1,146)
Leased wireless devices, net		$	115	$	269

Future minimum payments expected to be received over the lease term related to leased wireless devices, which exclude optional residual buy-out amounts at the end of the lease term, are summarized below:

(in millions)	Expected Payments
Twelve Months Ending December 31,
2024	$	50
2025	6
Total	$	56

Wireline Impairment

During the second quarter of 2022, we determined that the retirement of the legacy Sprint CDMA and LTE wireless networks triggered the need to separately assess the Wireline long-lived asset group for impairment and the results of this assessment indicated that certain Wireline Operating lease right-of-use assets were impaired. See Note 14 - Wireline for further information.

Leases

Note 16 – Leases

Lessee

We are a lessee for non-cancelable operating and financing leases for cell sites, switch sites, retail stores, network equipment and office facilities with contractual terms that generally extend through 2035. The majority of cell site leases have a non-cancelable term of five to 15 years with several renewal options that can extend the lease term for five to 50 years. In addition, we have financing leases for network equipment that generally have a non-cancelable lease term of three to five years. The financing leases do not have renewal options and contain a bargain purchase option at the end of the lease.

The components of lease expense were as follows:

	Year Ended December 31,
(in millions)	2023		2022		2021
Operating lease expense	$	4,987	$	6,514	$	5,921
Financing lease expense:
Amortization of right-of-use assets	684		733		738
Interest on lease liabilities	79		68		69
Total financing lease expense	763		801		807
Variable lease expense	411		484		429
Total lease expense	$	6,161	$	7,799	$	7,157

Information relating to the lease term and discount rate is as follows:

	Year Ended December 31,
	2023		2022		2021
Weighted-Average Remaining Lease Term (Years)
Operating leases	9		10		9
Financing leases	2		2		3
Weighted-Average Discount Rate
Operating leases	4.3	%	4.1	%	3.6	%
Financing leases	4.6	%	3.2	%	2.5	%

Maturities of lease liabilities as of December 31, 2023, were as follows:

(in millions)	Operating Leases		Finance Leases
Twelve Months Ending December 31,
2024	$	4,829	$	1,324
2025	4,380		836
2026	4,048		392
2027	3,733		35
2028	3,410		14
Thereafter	18,634		3
Total lease payments	39,034		2,604
Less: imputed interest	7,239		108
Total	$	31,795	$	2,496

Interest payments for financing leases were $79 million, $68 million and $69 million for the years ended December 31, 2023, 2022 and 2021, respectively.

As of December 31, 2023, we have additional operating leases for commercial properties that have not yet commenced with future lease payments of approximately $70 million.

As of December 31, 2023, we were contingently liable for future ground lease payments related to certain tower obligations. These contingent obligations are not included in the above table as the amounts owed are contractually owed by CCI based on the subleasing arrangement. See Note 9 – Tower Obligations for further information.

Lessor

The components of leased wireless devices under our Leasing Programs were as follows:

(in millions)	Average Remaining Useful Life	December 31, 2023		December 31, 2022
Leased wireless devices, gross	8 months	$	400	$	1,415
Accumulated depreciation		(285)		(1,146)
Leased wireless devices, net		$	115	$	269

Future minimum payments expected to be received over the lease term related to leased wireless devices, which exclude optional residual buy-out amounts at the end of the lease term, are summarized below:

(in millions)	Expected Payments
Twelve Months Ending December 31,
2024	$	50
2025	6
Total	$	56

Wireline Impairment

During the second quarter of 2022, we determined that the retirement of the legacy Sprint CDMA and LTE wireless networks triggered the need to separately assess the Wireline long-lived asset group for impairment and the results of this assessment indicated that certain Wireline Operating lease right-of-use assets were impaired. See Note 14 - Wireline for further information.