FIRST ADVANTAGE CORP Goodwill & Intangibles Disclosure
Note 5. Goodwill and Other Intangible Assets
The changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024 by reportable segment were as follows (in thousands):
|
|
First Advantage Americas |
|
|
First Advantage International |
|
|
Sterling |
|
|
Total |
|
||||
Balance – December 31, 2023 |
|
$ |
703,797 |
|
|
$ |
116,857 |
|
|
$ |
— |
|
|
$ |
820,654 |
|
Acquisitions |
|
|
— |
|
|
|
— |
|
|
|
1,313,365 |
|
|
|
1,313,365 |
|
Adjustments to initial purchase price allocations |
|
|
(368 |
) |
|
|
— |
|
|
|
— |
|
|
|
(368 |
) |
Foreign currency translation |
|
|
(135 |
) |
|
|
(2,516 |
) |
|
|
(6,472 |
) |
|
|
(9,123 |
) |
Balance – December 31, 2024 |
|
$ |
703,294 |
|
|
$ |
114,341 |
|
|
$ |
1,306,893 |
|
|
$ |
2,124,528 |
|
Adjustments to initial purchase price allocations |
|
|
— |
|
|
|
— |
|
|
|
6,440 |
|
|
|
6,440 |
|
Foreign currency translation |
|
|
89 |
|
|
|
2,060 |
|
|
|
10,487 |
|
|
|
12,636 |
|
Balance – December 31, 2025 |
|
$ |
703,383 |
|
|
$ |
116,401 |
|
|
$ |
1,323,820 |
|
|
$ |
2,143,604 |
|
The following summarizes the gross carrying value and accumulated amortization for the Company’s trade names, customer lists, and other intangible assets as of December 31, 2025 and 2024 (in thousands):
|
|
December 31, 2025 |
||||||||||||
|
|
Gross |
|
|
Accumulated |
|
|
Net Carrying |
|
|
Useful Life |
|||
Trade names |
|
$ |
158,382 |
|
|
$ |
(58,902 |
) |
|
$ |
99,480 |
|
|
5-20 years |
Customer lists |
|
|
1,176,608 |
|
|
|
(420,263 |
) |
|
|
756,345 |
|
|
13-14 years |
Other intangible assets |
|
|
2,400 |
|
|
|
(1,114 |
) |
|
|
1,286 |
|
|
5 years |
Total |
|
$ |
1,337,390 |
|
|
$ |
(480,279 |
) |
|
$ |
857,111 |
|
|
|
|
|
December 31, 2024 |
||||||||||||
|
|
Gross |
|
|
Accumulated |
|
|
Net Carrying |
|
|
Useful Life |
|||
Trade names |
|
$ |
157,740 |
|
|
$ |
(39,265 |
) |
|
$ |
118,475 |
|
|
5-20 years |
Customer lists |
|
|
1,170,327 |
|
|
|
(302,632 |
) |
|
|
867,695 |
|
|
13-14 years |
Other intangible assets |
|
|
2,400 |
|
|
|
(622 |
) |
|
|
1,778 |
|
|
5 years |
Total |
|
$ |
1,330,467 |
|
|
$ |
(342,519 |
) |
|
$ |
987,948 |
|
|
|
Amortization expense of trade names, customer lists, and other intangible assets was approximately $136.7 million, $68.7 million, and $62.1 million, for the years ended December 31, 2025, 2024, and 2023, respectively.
Amortization expense relating to trade names, customer lists, and other intangible assets is expected to be as follows (in thousands):
Years Ending December 31, |
|
|
|
|
2026 |
|
$ |
137,906 |
|
2027 |
|
|
123,251 |
|
2028 |
|
|
112,142 |
|
2029 |
|
|
98,175 |
|
2030 |
|
|
76,150 |
|
Thereafter |
|
|
309,487 |
|
|
|
$ |
857,111 |
|
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Feb 28, 2023 | |
| 2021 | Mar 23, 2022 | |
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.