Property, Plant and Equipment

5. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment, net consists of the following.


	March 31,
in millions	2026		2025
Land and property rights	$	238	$	224
Buildings	2,293		2,268
Machinery and equipment(1)	7,074		6,697
Gross property, plant and equipment (excluding construction in progress)	9,605		9,189
Accumulated depreciation and amortization	(5,140)		(4,726)
Property, plant and equipment, net (excluding construction in progress)	4,465		4,463
Construction in progress	4,346		2,388
Property, plant and equipment, net(2)	$	8,811	$	6,851

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(1)In addition to equipment under finance leases, machinery and equipment also includes furniture, fixtures, and equipment.

(2)Included in property, plant and equipment, net are $35 million and $16 million of finance leases as of March 31, 2026 and 2025, respectively. This balance of finance leases represents gross finance leases of $66 million, net of accumulated amortization of $31 million, and $42 million, net of accumulated amortization of $26 million, as of March 31, 2026 and 2025, respectively. Of the $66 million and $42 million of gross finance leases as of March 31, 2026 and 2025, $64 million and $40 million were included in machinery and equipment, respectively.

During fiscal 2026, fiscal 2025, and fiscal 2024, we capitalized $126 million, $60 million, and $26 million of interest related to construction of property, plant and equipment and intangibles under development, respectively.

Depreciation expense related to property, plant and equipment, net is shown in the table below.


in millions	Fiscal 2026		Fiscal 2025		Fiscal 2024
Depreciation expense related to property, plant and equipment, net included in depreciation and amortization	$	534	$	492	$	481

Impairment charges are recorded in restructuring and impairment, net on our consolidated statements of operations. There were no impairment charges related to property, plant and equipment in fiscal 2026, fiscal 2025 or fiscal 2024.

Asset Retirement Obligations

An asset retirement obligation is recognized in the period in which sufficient information exists to determine the fair value of the liability along with a corresponding increase to the carrying amount of the related property, plant and equipment, which is then depreciated over its useful life. As of March 31, 2026, our asset retirement obligations relate to sites, primarily in North America and Europe, that have government imposed or other legal remediation obligations. We had an ending balance of asset retirement obligations in fiscal 2026 of $22 million, with $1 million of foreign exchange and other adjustments with no changes related to liabilities incurred, liabilities settled, or accretion expenses. We had beginning and ending balances of asset retirement obligations in fiscal 2025 and fiscal 2024 of $21 million, with no changes related to liabilities incurred, liabilities settled, or accretion expenses. The current portion of our asset retirement obligations is included in accrued expenses and other current liabilities in our consolidated balance sheets, while the long-term portion is included in other long–term liabilities. As of March 31, 2026, $22 million was included in other long–term liabilities.