Dauch CorpDCH
Dauch Corp Goodwill & Intangibles Disclosure
3. GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill The following table provides a reconciliation of changes in goodwill for the year ended December 31, 2025 and the year ended December 31, 2024:
| Consolidated | |||||
| (in millions) | |||||
| Balance as of January 1, 2024 | $ | 182.1 | |||
| Reclassification to Assets held-for-sale | (8.3) | ||||
| Foreign currency translation | (1.8) | ||||
| Balance as of December 31, 2024 | $ | 172.0 | |||
| Foreign currency translation | 2.4 | ||||
| Balance as of December 31, 2025 | $ | 174.4 | |||
We conduct our annual goodwill impairment test in the fourth quarter of each year, as well as whenever adverse events or changes in circumstances indicate a possible impairment. In performing this test, we utilize a third-party valuation specialist to assist management in determining the fair value of our reporting units. Fair value of each reporting unit is estimated based on a combination of discounted cash flows and the use of pricing multiples derived from an analysis of comparable public companies multiplied against historical and/or anticipated financial metrics of each reporting unit. These calculations contain uncertainties as they require management to make assumptions including, but not limited to, market comparables, future cash flows of the reporting units, and appropriate discount and long-term growth rates. This fair value determination is categorized as Level 3 within the fair value hierarchy.
For our goodwill impairment test in the fourth quarter of 2025, we utilized a Step 0 qualitative analysis, as permitted under the guidance in ASC 350, and concluded that it is more-likely-than-not that the fair value of Driveline exceeded its carrying value as of the testing date. We concluded that a Step 0 analysis was appropriate based on the significant excess of fair value over carrying value for Driveline resulting from our 2024 goodwill impairment test, and further as a result of relative stability in our operating environment. In addition, financial results of Driveline for 2025 were comparable to 2024, as were Driveline's projected financial results in our current long-range plan, as compared to the plan utilized in the 2024 goodwill impairment test.
At December 31, 2025, accumulated goodwill impairment losses were $1,435.5 million. All remaining goodwill is attributable to our Driveline reporting unit.
On July 1, 2025, we completed the sale of AAM India Manufacturing Corporation Pvt., Ltd. to Bharat Forge Limited. As a result, we removed $8.3 million of goodwill associated with this business from our Consolidated Balance Sheet as of December 31, 2025 that had previously been classified as held-for-sale. See Note 2 - Acquisitions and Dispositions for for detail.
Other Intangible Assets The following table provides a reconciliation of the gross carrying amount and associated accumulated amortization for the Company's other intangible assets, which are all subject to amortization, as of December 31, 2025 and December 31, 2024:
| December 31, | December 31, | ||||||||||||||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||||||||||||||
| Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||||||||||||||
| (in millions) | |||||||||||||||||||||||||||||||||||
| Capitalized computer software | $ | 61.2 | $ | (55.7) | $ | 5.5 | $ | 60.9 | $ | (52.6) | $ | 8.3 | |||||||||||||||||||||||
| Customer platforms | 856.2 | (555.0) | 301.2 | 856.2 | (491.6) | 364.6 | |||||||||||||||||||||||||||||
| Customer relationships | 53.0 | (29.9) | 23.1 | 53.0 | (26.5) | 26.5 | |||||||||||||||||||||||||||||
| Technology and other | 149.5 | (104.1) | 45.4 | 153.8 | (96.5) | 57.3 | |||||||||||||||||||||||||||||
| Total | $ | 1,119.9 | $ | (744.7) | $ | 375.2 | $ | 1,123.9 | $ | (667.2) | $ | 456.7 | |||||||||||||||||||||||
Amortization expense for our intangible assets was $81.8 million for the year ended December 31, 2025, $82.9 million for the year ended December 31, 2024, and $85.6 million for the year ended December 31, 2023. Estimated amortization expense for the years 2026 through 2029 is expected to be approximately $80 million per year, decreasing to approximately $50 million in 2030, as the intangible assets identified as part of our 2017 acquisition of Metaldyne Performance Group, Inc. become fully amortized. These expected future amounts are on a Company stand-alone basis and do not include amortization expense that may be incurred in connection with the Business Combination.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 14, 2025 | |
| 2023 | Feb 16, 2024 | |
| 2022 | Feb 17, 2023 | |
| 2021 | Feb 11, 2022 | |
| 2020 | Feb 12, 2021 | |
| 2019 | Feb 14, 2020 | |
| 2018 | Feb 15, 2019 | |
| 2017 | Feb 16, 2018 | |
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.