PayPal enters into various leases, which are primarily real estate operating leases. We use these properties for executive and administrative offices, data centers, product development offices, customer services and operations centers, and warehouses.

While a majority of our lease agreements do not contain an explicit interest rate, certain of our lease agreements are subject to changes based on the Consumer Price Index or another referenced index. In the event of changes to the relevant index, lease liabilities are not remeasured and instead are treated as variable lease payments and recognized in the period in which the obligation for those payments is incurred.


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(In millions)
Lease expense
Operating lease expense	$	39	$	43	$	80	$	85


Sublease income	(2)		(2)		(4)		(4)
Lease expense, net	$	37	$	41	$	76	$	81


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
	(In millions)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	43	$	42	$	86	$	83
Right-of-use (“ROU”) lease assets obtained in exchange for new operating lease liabilities	$	23	$	11	$	22	$	94
Other non-cash ROU lease asset activity	$	(4)	$	(15)	$	(25)	$	(25)


	June 30, 2023			December 31, 2022
	(In millions, except weighted-average figures)
Operating ROU lease assets	$	495		$	574
Current operating lease liabilities	152			151
Operating lease liabilities	509			569
Total operating lease liabilities	$	661		$	720
Weighted-average remaining lease term—operating leases	5.6 years			5.7 years
Weighted-average discount rate—operating leases	4		%	3		%

Operating lease amounts include minimum lease payments under our non-cancelable operating leases primarily for office and data center facilities. The amounts presented are consistent with contractual terms and are not expected to differ significantly from actual results under our existing leases.

In the three and six months ended June 30, 2023, we incurred asset impairment charges of $4 million and $43 million, respectively, within restructuring and other charges on our condensed consolidated statements of income (loss). The impairments in the three and six months ended June 30, 2023 included a reduction to our ROU lease assets in the amount of $4 million and $25 million, respectively, which were attributed to certain leased space we are no longer utilizing for our business operations, a portion of which is being subleased. In the three and six months ended June 30, 2022, we incurred asset impairment charges of $19 million and $35 million, respectively, within restructuring and other charges on our condensed consolidated statements of income (loss). The impairments in the three and six months ended June 30, 2022 included a reduction to our ROU lease assets in the amount of $15 million and $25 million, respectively, which were attributed to certain leased space we are no longer utilizing for our business operations, a portion of which is being subleased.