Leases

12 Months Ended

Dec. 27, 2025

Leases

Lessee

We determine whether an arrangement is a lease at inception. We have operating leases for plants, warehouses, distribution centers, storage facilities, offices and other facilities, as well as machinery and equipment, including fleet. Our leases generally have remaining lease terms of up to 20 years, some of which include options to extend the lease term for up to five years and some of which include options to terminate the lease within one year. We consider these options in determining the lease term used to establish our right-of-use assets and lease liabilities. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

We have lease agreements that contain both lease and non-lease components. For real estate leases, we account for lease components together with non-lease components (e.g., common-area maintenance).

Components of lease cost are as follows:


	2025		2024		2023
Operating lease cost (a)	$	880	$	788	$	666
Variable lease cost (b)	$	185	$	165	$	146
Short-term lease cost (c)	$	570	$	566	$	582

(a)Includes right-of-use asset amortization of $727 million, $655 million, and $570 million in 2025, 2024, and 2023, respectively.

(b)Primarily related to adjustments for inflation, common-area maintenance and property tax.

(c)Not recorded on our balance sheet.

In 2025, 2024 and 2023, we recognized gains of $291 million, $118 million and $52 million, respectively, on sale-leaseback transactions with lease terms of ten years or less.

Supplemental cash flow information and non-cash activity related to our operating leases are as follows:


	2025		2024		2023
Operating cash flow information:
Cash paid for amounts included in the measurement of lease liabilities	$	866	$	775	$	655
Non-cash activity:
Right-of-use assets obtained in exchange for lease obligations	$	1,046	$	1,218	$	1,088

Supplemental balance sheet information related to our operating leases is as follows:



	Balance Sheet Classification	2025		2024
Right-of-use assets	Other assets	$	3,745	$	3,383
Current lease liabilities	Accounts payable and other current liabilities	$	719	$	642
Noncurrent lease liabilities	Other liabilities	$	3,127	$	2,803

Weighted-average remaining lease term and discount rate for our operating leases are as follows:


	2025		2024		2023
Weighted-average remaining lease term	7 years		7 years		7 years
Weighted-average discount rate	5	%	4	%	4	%

Maturities of lease liabilities by year for our operating leases are as follows:


2026	$	858
2027	750
2028	631
2029	512
2030	434
2031 and beyond	1,342
Total lease payments	4,527
Less: Imputed interest	681
Present value of lease liabilities	$	3,846

Operating lease payments presented in the table above exclude approximately $900 million of minimum lease payments related to leases entered into but not yet commenced as of December 27, 2025, with weighted-average lease terms of thirteen years.

Finance leases were not material as of December 27, 2025, December 28, 2024 and December 30, 2023.

Lessor

We have various arrangements for certain foodservice and vending equipment under which we are the lessor. These leases meet the criteria for operating lease classification. Lease income associated with these leases is not material.