ATI INCATI
ATI INC Goodwill & Intangibles Disclosure
Goodwill and Other Intangible Assets
At December 28, 2025 and December 29, 2024, the Company reported goodwill amounts of $225.2 million and $227.2 million, respectively, on its consolidated balance sheet, all of which relates to the HPMC segment. Goodwill decreased by $2.0 million during fiscal year 2025 due to the sale of the Company’s East Hartford, Connecticut operations and related allocation of goodwill from the Forged Products reporting unit.
The Company performs its annual goodwill impairment evaluation in the fourth quarter of each fiscal year. The $225.2 million of goodwill as of December 28, 2025 on the Company’s consolidated balance sheet is comprised of $159.2 million at the Forged Products reporting unit and $66.0 million at the Specialty Materials reporting unit. For the Company’s annual goodwill impairment evaluation in fiscal year 2025, quantitative goodwill assessments were performed for these two reporting units.
Fair values were determined using discounted cash flows, which represents Level 3 unobservable information in the fair value hierarchy. These quantitative assessments and valuations require estimates and assumptions regarding revenue growth, changes in working capital, capital expenditures, selling prices, income taxes, and profitability, all of which impact estimated future cash flows. In addition, discounted cash flow valuations are impacted by the determination of ATI's WACC, which also requires the Company to exercise judgment and make estimates. Actual results could differ from those estimates and assumptions. For the annual goodwill impairment in fiscal year 2025, a WACC of 10.5% and long-term growth rates ranging from 3% to 3.5% were used in the discounted cash flow valuation. Further, to validate the reasonableness of the estimated fair values of the reporting units as of the valuation date, a reconciliation of the aggregate fair values of all reporting units to market capitalization was performed using a reasonable control premium. Although the Company believes that the estimates and assumptions used were reasonable, actual results could differ from those estimates and assumptions.
Based on the annual goodwill impairment evaluation for fiscal year 2025, the Company determined that the fair values of the Specialty Materials and Forged Products reporting units exceeded their respective carrying values. As a result, it was concluded that no impairments existed for the fiscal year ended December 28, 2025. Also, there were no impairments for the fiscal years ended December 29, 2024 and December 31, 2023.
No indicators of impairment were observed in fiscal years 2025, 2024 and 2023 associated with any of the Company’s long-lived assets. Accumulated goodwill impairment losses as of December 28, 2025, December 29, 2024 and December 31, 2023 were $528.0 million.
Other intangible assets, which are included in other assets on the accompanying consolidated balance sheets as of December 28, 2025 and December 29, 2024 were as follows:
| December 28, 2025 | December 29, 2024 | |||||||||||||||||||||||||
| (in millions) | Gross carrying amount | Accumulated amortization | Gross carrying amount | Accumulated amortization | ||||||||||||||||||||||
| Technology | $ | 60.5 | $ | (44.4) | $ | 61.2 | $ | (41.8) | ||||||||||||||||||
| Customer relationships | 24.5 | (14.3) | 24.8 | (13.5) | ||||||||||||||||||||||
| Trademarks | 48.2 | (38.6) | 48.8 | (35.8) | ||||||||||||||||||||||
| Total amortizable intangible assets | $ | 133.2 | $ | (97.3) | $ | 134.8 | $ | (91.1) | ||||||||||||||||||
During fiscal year 2025, total amortizable intangible assets, net, decreased approximately $0.5 million as a result of the sale of the Company’s East Hartford, CT operations. This decrease consists of the sale of approximately $1.6 million of gross intangible assets, net of approximately $1.1 million of accumulated amortization.
Amortization expense related to intangible assets was approximately $7.0 million for each of the fiscal years ended December 28, 2025, December 29, 2024, and December 31, 2023. Annual amortization expense is expected to be approximately $7.0 million for each of the fiscal years 2026 through 2028 and $4.0 million in fiscal year 2029 and 2030.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 20, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 25, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 25, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Feb 20, 2018 | |
| 2016 | Feb 24, 2017 | |
| 2015 | Feb 26, 2016 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.