v3.26.1
Leases
 6 Months Ended
Jul. 04, 2026
Leases [Abstract]  
Leases Leases
We primarily lease certain manufacturing plants, offices, warehouses, training and service centers at various locations worldwide that are classified as either operating or finance leases. Our leases have remaining lease terms up to 25 years, which include options to extend the lease term for periods up to 20 years when it is reasonably certain the option will be exercised.
Operating lease cost totaled $20 million and $18 million in the second quarter of 2026 and 2025, respectively, and $39 million and $36 million in the first half of 2026 and 2025, respectively. Cash paid for operating leases approximated the lease cost and is classified in cash flows from operating activities. Noncash transactions related to operating leases totaled $35 million and $3 million in the first half of 2026 and 2025, respectively, reflecting new or modified leases and changes from the reassessment of lease options. Finance lease, variable and short-term lease costs were not significant.
Balance sheet and other information related to our leases is as follows:
(Dollars in millions)July 4,
2026		January 3,
2026
Operating leases:
Other assets$394$390
Other current liabilities5658
Other liabilities350346
Weighted-average remaining lease term (in years)9.69.5
Weighted-average discount rate5.02%4.97%
Finance leases:
Property, plant and equipment, less accumulated amortization
  of $10 million and $14 million, respectively
$24$95
Long-term debt, including current portion27100
Weighted-average remaining lease term (in years)15.75.9
Weighted-average discount rate6.44%6.63%
At July 4, 2026, maturities of our operating lease liabilities on an undiscounted basis totaled $37 million for the remainder of 2026, $69 million for 2027, $64 million for 2028, $59 million for 2029, $50 million for 2030 and $242 million thereafter. In the first quarter of 2026, we paid $72 million in connection with the termination of a finance lease resulting from our election to exercise an option to purchase the related manufacturing facility for the MV-75 program.
Leases Leases
We primarily lease certain manufacturing plants, offices, warehouses, training and service centers at various locations worldwide that are classified as either operating or finance leases. Our leases have remaining lease terms up to 25 years, which include options to extend the lease term for periods up to 20 years when it is reasonably certain the option will be exercised.
Operating lease cost totaled $20 million and $18 million in the second quarter of 2026 and 2025, respectively, and $39 million and $36 million in the first half of 2026 and 2025, respectively. Cash paid for operating leases approximated the lease cost and is classified in cash flows from operating activities. Noncash transactions related to operating leases totaled $35 million and $3 million in the first half of 2026 and 2025, respectively, reflecting new or modified leases and changes from the reassessment of lease options. Finance lease, variable and short-term lease costs were not significant.
Balance sheet and other information related to our leases is as follows:
(Dollars in millions)July 4,
2026		January 3,
2026
Operating leases:
Other assets$394$390
Other current liabilities5658
Other liabilities350346
Weighted-average remaining lease term (in years)9.69.5
Weighted-average discount rate5.02%4.97%
Finance leases:
Property, plant and equipment, less accumulated amortization
  of $10 million and $14 million, respectively
$24$95
Long-term debt, including current portion27100
Weighted-average remaining lease term (in years)15.75.9
Weighted-average discount rate6.44%6.63%
At July 4, 2026, maturities of our operating lease liabilities on an undiscounted basis totaled $37 million for the remainder of 2026, $69 million for 2027, $64 million for 2028, $59 million for 2029, $50 million for 2030 and $242 million thereafter. In the first quarter of 2026, we paid $72 million in connection with the termination of a finance lease resulting from our election to exercise an option to purchase the related manufacturing facility for the MV-75 program.