Annual report [Section 13 and 15(d), not S-K Item 405]

LEASES FOOTNOTE DISCLOSURE LEASES FOOTNOTE DISCLOSURE (Notes)

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LEASES FOOTNOTE DISCLOSURE LEASES FOOTNOTE DISCLOSURE (Notes)
 12 Months Ended
Dec. 31, 2025
Leases [Abstract]  
Leases of Lessee Disclosure
NOTE 8. LEASES
Our lease portfolio consists primarily of real estate and equipment leases. Our real estate leases primarily consist of land, office, distribution, warehousing and manufacturing facilities. These leases typically range in term from 2 to 50 years and may contain renewal options for periods up to 10 years at our discretion. Our equipment lease portfolio consists primarily of vehicles (including service vehicles), fork trucks and IT equipment. These leases typically range in term from two to four years and may contain renewal options. Our leases generally do not contain variable lease payments other than (1) certain foreign real estate leases which have payments indexed to inflation and (2) certain real estate executory costs (such as taxes, insurance and maintenance), which are paid based on actual expenses incurred by the lessor during the year. Our leases generally do not include residual value guarantees other than our service vehicle fleet, which has a residual guarantee based on a percentage of the original cost declining over the lease term.
The components of our lease cost were as follows:
Years ended December 31,
In millions 2025 2024 2023
Operating lease cost $ 184  $ 187  $ 165 
Finance lease cost
Amortization of right-of-use asset 29  26  20 
Interest expense 8  7  4 
Short-term lease cost 33  41  24 
Variable lease cost 18  17  14 
Total lease cost $ 272  $ 278  $ 227 
Supplemental balance sheet information related to leases:
December 31,
In millions 2025 2024 Balance Sheet Location
Assets
Operating lease assets $ 537  $ 532  Other assets
Finance lease assets (1)
126  121  Property, plant and equipment, net
Total lease assets $ 663  $ 653 
Liabilities
Current
Operating lease liabilities $ 138  $ 130  Other accrued expenses
Finance lease liabilities 25  20  Current maturities of long-term debt
Long-term
Operating lease liabilities 424  409  Other liabilities
Finance lease liabilities 111  105  Long-term debt
Total lease liabilities $ 698  $ 664 
(1) Finance lease assets were recorded net of accumulated amortization of $100 million and $80 million at December 31, 2025 and 2024.
Supplemental cash flow and other information related to leases:
Years ended December 31,
In millions 2025 2024 2023
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases $ 203  $ 176  $ 148 
Operating cash flows from finance leases 8  7  4 
Financing cash flows from finance leases 28  23  35 
Right-of-use assets obtained in exchange for lease obligations
Operating leases $ 153  $ 268  $ 153 
Finance leases 36  43  12 
Additional information related to leases:
December 31,
2025 2024
Weighted-average remaining lease term (in years)
Operating leases 5.6 5.9
Finance leases 6.6 7.8
Weighted-average discount rate
Operating leases 4.8  % 4.6  %
Finance leases 6.1  % 6.0  %
Following is a summary of the future minimum lease payments related to finance and operating leases with terms of more than one year at December 31, 2025, together with the net present value of the minimum payments:
In millions Finance Leases Operating Leases
2026 $ 33  $ 163 
2027 29  133 
2028 25  105 
2029 19  68 
2030 16  48 
After 2030 46  132 
Total minimum lease payments 168  649 
Interest (32) (87)
Present value of net minimum lease payments $ 136  $ 562