Leases

6 Months Ended

Jul. 02, 2022

We primarily lease certain manufacturing plants, offices, warehouses, training and service centers at various locations worldwide through operating leases. Our operating leases have remaining lease terms up to 27 years, which include options to extend the lease term for periods up to 25 years when it is reasonably certain the option will be exercised. Operating lease cost totaled $17 million and $16 million in the second quarter of 2022 and 2021, respectively, and $34 million and $32 million in the first half of 2022 and 2021, respectively. Variable and short-term lease costs were not significant. Cash paid for operating leases totaled $35 million and $33 million in the first half of 2022 and 2021, respectively, and is classified in cash flows from operating activities. Noncash transactions totaled $17 million and $63 million in the first half of 2022 and 2021, respectively, reflecting the recognition of operating lease assets and liabilities for new or extended leases.

Balance sheet and other information related to our operating leases is as follows:


(Dollars in millions)	July 2, 2022		January 1, 2022
Other assets	$	359	$	374
Other current liabilities	56		56
Other liabilities	310		325
Weighted-average remaining lease term (in years)	10.1		10.5
Weighted-average discount rate	3.22%		3.19%

At July 2, 2022, maturities of our operating lease liabilities on an undiscounted basis totaled $35 million for the remainder of 2022, $65 million for 2023, $55 million for 2024, $47 million for 2025, $35 million for 2026 and $217 million thereafter.