Property and Equipment

9 Months Ended

Sep. 30, 2023

Property, Plant and Equipment [Abstract]

Property and equipment, net consists of the following (in millions):


	September 30, 2023		December 31, 2022
Land	$	1,900	$	1,874
Servers and network assets	44,662		34,330
Buildings	35,422		27,720
Leasehold improvements	6,841		6,522
Equipment and other	7,056		5,642
Finance lease right-of-use assets	3,794		3,353
Construction in progress	22,945		25,052
Property and equipment, gross	122,620		104,493
Less: Accumulated depreciation	(30,848)		(24,975)
Property and equipment, net	$	91,772	$	79,518

Construction in progress includes costs mostly related to construction of data centers, network infrastructure and servers. As of September 30, 2023, construction in progress also includes $1.51 billion of servers and network assets components stored by our suppliers until required by our design manufacturers to fulfill certain purchase orders.

Depreciation expense on property and equipment was $2.83 billion and $2.13 billion for the three months ended September 30, 2023 and 2022, respectively, and $7.88 billion and $6.17 billion for the nine months ended September 30, 2023 and 2022, respectively. Within property and equipment, our servers and network assets depreciation expenses were $1.94 billion and $1.36 billion for the three months ended September 30, 2023 and 2022, respectively, and $5.16 billion and $3.92 billion for the nine months ended September 30, 2023 and 2022, respectively. During the three and nine months ended September 30, 2023, we capitalized $82 million and $198 million of interest expense, respectively, related to certain eligible construction in progress assets.

During the three and nine months ended September 30, 2023, we recorded $161 million and $352 million, respectively, of impairment loss mostly for leasehold improvements assets as a part of our facilities consolidation restructuring efforts. For additional information, see Note 3 — Restructuring.