We lease real estate, fleet, and equipment for use in our operations. Our leases generally have lease terms of 1 to 30 years, some of which include options to terminate or extend leases for up to 5 to 10 years or on a month-to-month basis. We include options that are reasonably certain to be exercised as part of the determination of lease terms. We may negotiate termination clauses in anticipation of any changes in market conditions, but generally these termination options have not been exercised. Residual value guarantees are generally not included within our operating leases with the exception of some fleet leases. In addition to base rent payments, the leases may require us to pay directly for taxes and other non-lease components, such as insurance, maintenance and other operating expenses, which may be dependent on usage or vary month-to-month. Variable lease payments amounted to $453 million in 2025, $517 million in 2024 and $444 million in 2023. We elected the practical expedient to not separate non-lease components from lease components in calculating the amounts of ROU assets and lease liabilities for all underlying asset classes.

We determine if an arrangement is a lease at inception of the contract and we perform the lease classification test as of the lease commencement date. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date

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


For operating leases, the ROU assets and liabilities in our consolidated balance sheets follows:
		As of December 31,
(MILLIONS)	Balance Sheet Classification	2025		2024
ROU assets	Other noncurrent assets	$	2,213	$	2,289
Lease liabilities (short-term)	Other current liabilities	330		356
Lease liabilities (long-term)	Other noncurrent liabilities	2,291		2,286


Components of total lease cost includes:
	Year Ended December 31,
(MILLIONS)	2025		2024		2023
Operating lease cost	$	498	$	683	$	863



Variable lease cost	453		517		444
Sublease income	(26)		(23)		(24)
Total lease cost	$	924	$	1,177	$	1,283


	Year Ended December 31,
(MILLIONS)	2025		2024		2023



Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases	$	471	$	601	$	744

(Gains)/losses on sale and leaseback transactions, net	(53)		29		(49)


The following reconciles the undiscounted cash flows for the first five years and total of the remaining years to the operating lease liabilities recorded in the consolidated balance sheet as of December 31, 2025:
(MILLIONS)
Period	Operating Lease Liabilities
Next one year(a)	$	417
1-2 years	408
2-3 years	334
3-4 years	282
4-5 years	234
Thereafter	1,524
Total undiscounted lease payments	3,199
Less: Imputed interest	579
Present value of minimum lease payments	2,620
Less: Current portion	330
Noncurrent portion	$	2,291