Leases
Our lease obligations primarily consist of operating leases for our offices and data centers, with lease periods expiring between fiscal years 2027 and 2041.
Future minimum lease obligations under our non-cancelable lease agreements as of January 25, 2026 were as follows:
| | | | | |
| Operating Lease Obligations |
| | (In millions) |
| Fiscal Year: | |
| 2027 | $ | 493 | |
| 2028 | 485 | |
| 2029 | 457 | |
| 2030 | 381 | |
| 2031 | 314 | |
| 2032 and thereafter | 1,494 | |
| Total | 3,624 | |
| Less imputed interest | 680 | |
| Present value of net future minimum lease payments | 2,944 | |
| Less short-term operating lease liabilities | 372 | |
| Long-term operating lease liabilities | $ | 2,572 | |
Between fiscal years 2027 and 2030, we expect to commence leases with future obligations of $22.7 billion, primarily data center leases to support our research and development efforts, with lease terms of 1.8 to 20 years.
Operating lease costs for fiscal years 2026, 2025, and 2024 were $462 million, $356 million, and $269 million, respectively. Short-term and variable lease costs for fiscal years 2026, 2025, and 2024 were not significant.
Other information related to leases was as follows:
| | | | | | | | | | | | | | | | | |
| Year Ended |
| Jan 25, 2026 | | Jan 26, 2025 | | Jan 28, 2024 |
| | | | | |
| | (In millions) |
| Supplemental cash flows information | | | | | |
| Operating cash flow used for operating leases | $ | 428 | | | $ | 313 | | | $ | 286 | |
| Operating lease assets obtained in exchange for lease obligations | $ | 1,439 | | | $ | 877 | | | $ | 531 | |
As of January 25, 2026, our operating leases have a weighted average remaining lease term of 8.8 years and a weighted average discount rate of 4.38%. As of January 26, 2025, our operating leases had a weighted average remaining lease term of 6.5 years and a weighted average discount rate of 4.16%.
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.