HELEN OF TROY LTDHELE
HELEN OF TROY LTD Goodwill & Intangibles Disclosure
Note 7 - Goodwill and Intangibles
Amortization expense is recorded for intangible assets with definite useful lives and is reported within SG&A in our consolidated statements of (loss) income. Some of our goodwill is held in jurisdictions that allow deductions for tax purposes; however, in some of those jurisdictions we have no tax basis for the associated goodwill recorded. Accordingly, some of our goodwill is not deductible for tax purposes. We perform annual impairment testing each fiscal year and interim impairment testing, if necessary, as described in Note 1. We write down any asset deemed to be impaired to its fair value.
During each quarter of fiscal 2026, we concluded that a goodwill impairment triggering event had occurred due to a further sustained decline in our stock price, resulting in our carrying value (excluding long-term debt) exceeding the Company’s total enterprise value (market capitalization plus long-term debt). Additional factors that contributed to these conclusions included downward revisions to our internal forecasts and strategic long-term plans, which reflect the tariff policies in effect and the related macroeconomic environment at the end of each quarter of fiscal 2026, including the corresponding impact on consumer spending and retailer orders. These factors were applicable to all of our reporting units, indefinite-lived trademark licenses and trade names and definite-lived trademark licenses, trade names and certain other intangible assets. Thus, we performed quantitative impairment testing on our
goodwill and intangible assets described above during each quarter of fiscal 2026, all of which resulted in the recognition of impairment charges, which are further described below.
During the second and fourth quarters of fiscal 2025, we concluded a goodwill impairment triggering event had occurred due to a continued sustained decline in our stock price, resulting in our carrying value (excluding long-term debt) exceeding the Company’s total enterprise value (market capitalization plus long-term debt). Additional factors that contributed to this conclusion included downward revisions to our internal forecasts and strategic long-term plans. These factors were applicable to all of our reporting units, indefinite-lived and definite-lived trademark licenses and trade names and certain other intangible assets, as applicable. Thus, we performed quantitative impairment testing on our goodwill and intangible assets described above. The quantitative assessments performed during the second quarter of fiscal 2025 did not result in impairment of our goodwill or intangible assets. The quantitative assessments performed during the fourth quarter of fiscal 2025 resulted in the recognition of impairment charges, which are further described below.
We estimate the fair value of our trade names and trademark licenses using the relief from royalty method income approach which is based upon projected future discounted cash flows (“DCF Model”). We estimate the fair value of our customer relationships and lists using the distributor method income approach which is based upon a DCF Model. After adjusting the carrying values of our indefinite-lived and definite-lived intangible assets, the Company completed quantitative impairment testing for goodwill. We estimate the fair value of our reporting units using an income approach based upon projected future discounted cash flows.
Based on the outcome of these assessments, we recognized pre-tax asset impairment charges as follows:
| Fiscal Years Ended Last Day of February | |||||||||||
| (in thousands) | 2026 | 2025 | |||||||||
Home & Outdoor (1) | $ | 332,565 | $ | — | |||||||
| Beauty & Wellness (2) | 553,296 | 51,455 | |||||||||
Total | $ | 885,861 | $ | 51,455 | |||||||
(1)Asset impairment charges recognized for our Home & Outdoor segment included charges for our Hydro Flask and Osprey businesses of $184.4 million and $148.1 million, respectively, during fiscal 2026.
(2)Asset impairment charges recognized for our Beauty & Wellness segment included charges for our Health & Wellness, Drybar, Curlsmith and Revlon businesses of $242.2 million, $154.5 million, $133.0 million and $23.5 million, respectively, during fiscal 2026, and a charge for our Drybar business of $51.5 million during fiscal 2025.
During the first quarter of fiscal 2026, in connection with our annual budgeting and forecasting process, management reduced its forecasts for net sales revenue, gross margin and earnings before interest and taxes to reflect the tariff policies in effect and the related macroeconomic environment at the end of our first quarter of fiscal 2026, including the corresponding impact on consumer spending and retailer orders, as applicable. The revised forecasts also resulted in management selecting lower residual growth rates, which were also reflective of revised long-term industry growth expectations, and royalty rates, as applicable. During the second, third and fourth quarters of fiscal 2026, management further reduced its forecasts for net sales revenue, gross margin and earnings before interest and taxes to reflect the tariff policies in effect, timing of corresponding price increases inclusive of the impact of stop shipment actions to support consistent adoption and the related macroeconomic environment at the end of each quarter of fiscal 2026, including the impact on consumer spending, retailer orders and China cross border ecommerce due to a shift to localized distribution, as applicable. Our forecasts for fiscal 2027 were also updated during the fourth quarter of fiscal 2026, in connection with our annual budgeting process, which primarily resulted in an increase in operating expense, shifts in sales forecasts between brands and a reduction to the residual growth rate assumption for one of our reporting units.
During fiscal 2025, our Drybar business continued to experience a decline in net sales revenue due to lower consumer demand, increased competition, and net distribution declines, all of which contributed to reduced earnings and cash flows. In connection with our annual budgeting and forecasting process during the fourth quarter of fiscal 2025, management reduced its forecasts of Drybar’s net sales revenue growth, gross margin and earnings before interest and taxes which also resulted in management selecting a lower royalty rate.
Refer to Note 14 for additional information on our valuation method and related assumptions and estimates. For additional information regarding the testing and analysis performed, refer to Item 7., “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including “Critical Accounting Policies and Estimates” included within this Annual Report.
We performed our annual impairment testing of our goodwill and indefinite-lived intangible assets during the fourth quarter of fiscal 2024 and determined based on our qualitative assessment that it was not more likely than not that the fair value of each reporting unit and indefinite-lived intangible asset was lower than its carrying value. Therefore, quantitative testing in fiscal 2024 was not required. Accordingly, no impairment charges were recorded during fiscal 2024.
The following table summarizes the changes in our goodwill by segment for fiscal 2026 and 2025:
| (in thousands) | Home & Outdoor | Beauty & Wellness | Total | ||||||||||||||
Gross carrying amount as of February 29, 2024 | $ | 491,777 | $ | 574,953 | $ | 1,066,730 | |||||||||||
Accumulated impairment as of February 29, 2024 | — | — | — | ||||||||||||||
Net carrying amount as of February 29, 2024 | $ | 491,777 | $ | 574,953 | $ | 1,066,730 | |||||||||||
| Acquisitions (1) | — | 154,839 | 154,839 | ||||||||||||||
| Impairment charges (2) | — | (38,670) | (38,670) | ||||||||||||||
Gross carrying amount as of February 28, 2025 | 491,777 | 729,792 | 1,221,569 | ||||||||||||||
Accumulated impairment as of February 28, 2025 | — | (38,670) | (38,670) | ||||||||||||||
Net carrying amount as of February 28, 2025 | $ | 491,777 | $ | 691,122 | $ | 1,182,899 | |||||||||||
| Acquisitions (3) | — | (4,113) | (4,113) | ||||||||||||||
| (229,058) | (477,447) | (706,505) | |||||||||||||||
Gross carrying amount as of February 28, 2026 | 491,777 | 725,679 | 1,217,456 | ||||||||||||||
Accumulated impairment as of February 28, 2026 | (229,058) | (516,117) | (745,175) | ||||||||||||||
Net carrying amount as of February 28, 2026 | $ | 262,719 | $ | 209,562 | $ | 472,281 | |||||||||||
(1)Reflects the goodwill recorded in the Beauty & Wellness segment in connection with the acquisition of Olive & June on December 16, 2024. For additional information see Note 6.
(2)Reflects the goodwill impairment charge of $38.7 million recorded in the Beauty & Wellness segment to reduce our Drybar’s reporting unit’s goodwill to $134.3 million as of February 28, 2025.
(3)Reflects a favorable post-closing adjustment to goodwill recorded in the Beauty & Wellness segment during the first quarter of fiscal 2026, partially offset by an increase to goodwill for adjustments to a provisional current liability balance during the third quarter of fiscal 2026 in connection with the acquisition of Olive & June on December 16, 2024. For additional information see Note 6.
(4)Reflects the goodwill impairment charges of $115.9 million and $113.1 million related to our Hydro Flask and Osprey reporting units, respectively, recorded in the Home & Outdoor segment and $235.2 million, $134.3 million and $107.9 million related to our Heath & Wellness, Drybar and Curlsmith reporting units, respectively, recorded in the Beauty & Wellness segment. The remaining carrying values of the Osprey, Health & Wellness and Curlsmith reporting units’ goodwill as of February 28, 2026 were $96.6 million, $49.7 million and $9.2 million, respectively. The goodwill impairment charges recognized for the Hydro Flask and Drybar reporting units reduced the carrying values of their goodwill to zero.
The following table summarizes the components of our other intangible assets as follows:
| February 28, 2026 (1) | February 28, 2025 (1) | ||||||||||||||||||||||||||||||||||
| (in thousands) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||||||||||||
| Indefinite-lived: | |||||||||||||||||||||||||||||||||||
Trademark licenses | $ | 7,400 | $ | — | $ | 7,400 | $ | 7,400 | $ | — | $ | 7,400 | |||||||||||||||||||||||
| Trade names (2) | 257,200 | — | 257,200 | 358,200 | — | 358,200 | |||||||||||||||||||||||||||||
| Definite-lived: | |||||||||||||||||||||||||||||||||||
| Trademark licenses (3) | 45,385 | (3,757) | 41,628 | 75,050 | (9,454) | 65,596 | |||||||||||||||||||||||||||||
| Trade names (4) | 53,004 | (4,246) | 48,758 | 89,365 | (14,030) | 75,335 | |||||||||||||||||||||||||||||
| Customer relationships and lists (5) | 125,001 | (115,034) | 9,967 | 168,201 | (120,932) | 47,269 | |||||||||||||||||||||||||||||
| Other intangibles (6) | 58,355 | (50,458) | 7,897 | 74,297 | (61,341) | 12,956 | |||||||||||||||||||||||||||||
| Total | $ | 546,345 | $ | (173,495) | $ | 372,850 | $ | 772,513 | $ | (205,757) | $ | 566,756 | |||||||||||||||||||||||
(1)Balances as of February 28, 2026 and February 28, 2025 include intangible assets recorded in connection with the acquisition of Olive & June on December 16, 2024. For additional information see Note 6.
(2)Balances as of February 28, 2026 reflect total impairment charges of $97.0 million, which includes $55.0 million related to our Hydro Flask trade name, $35.0 million related to our Osprey trade name and $7.0 million related to our PUR trade name. The remaining carrying values of the Osprey and PUR trade names as of February 28, 2026 were $135.0 million and $47.0 million, respectively. The impairment charges were recorded in the Home & Outdoor segment for Hydro Flask and Osprey and in the Beauty & Wellness segment for PUR. The remaining carrying value of the Hydro Flask trade name of $4.0 million was reclassified to a definite-lived trade name as of November 30, 2025 and was subsequently fully impaired during the fourth quarter of fiscal 2026 as discussed below in footnote 4 to this table.
(3)Balances as of February 28, 2026 reflect total impairment charges recorded in the Beauty & Wellness segment of $23.5 million related to our Revlon trademark license. The remaining carrying value of this trademark license as of February 28, 2026 was $39.4 million. As of November 30, 2025, the remaining useful life of the Revlon trademark license was revised from approximately 35 years to 10 years, which will increase annual amortization expense by approximately $2.9 million.
(4)Balances as of February 28, 2026 reflect total impairment charges of $26.1 million, which includes $15.4 million related to our Curlsmith trade name, $6.7 million related to our Drybar trade name and $3.9 million related to our Hydro Flask trade name. The Hydro Flask trade name impairment charge was recorded during the fourth quarter of fiscal 2026, as its remaining carrying value was reclassified to a definite-lived trade name as of November 30, 2025. Impairment charges recognized during fiscal 2026 on the Hydro Flask trade name prior to November 30, 2025 are discussed above in footnote 2 to this table. The remaining carrying value of the Curlsmith trade name as of February 28, 2026 was $1.9 million. The impairment charges recognized for the Drybar and Hydro Flask trade names reduced the carrying values of these assets to zero. The impairment charges were recognized in the Beauty & Wellness segment for Curlsmith and Drybar and in the Home & Outdoor segment for Hydro Flask. Balances as of February 28, 2025 reflect an impairment charge of $12.8 million to reduce the carrying value of the Drybar trade name to $7.0 million as of February 28, 2025.
(5)Balances as of February 28, 2026 reflect total impairment charges of $29.2 million, which includes $10.7 million related to our Drybar customer relationship, $9.7 million related to our Curlsmith customer relationship and $8.8 million related to our Hydro Flask customer relationship. The impairment charges were recorded in the Beauty & Wellness segment for Curlsmith and Drybar and in the Home & Outdoor segment for Hydro Flask. The impairment charges reduced the carrying values of these assets to zero.
(6)Balances as of February 28, 2026 reflect total impairment charges of $3.6 million, which includes $2.8 million and $0.8 million recorded in the Beauty & Wellness and Home & Outdoor segments, respectively, related to Drybar and Hydro Flask other intangibles which reduced the carrying values of these assets to zero.
The following tables summarize amortization expense related to our other intangible assets as follows:
Aggregate Amortization Expense (in thousands) | |||||
| Fiscal 2026 | $ | 17,059 | |||
| Fiscal 2025 | 18,875 | ||||
| Fiscal 2024 | 18,326 | ||||
Estimated Amortization Expense (in thousands) | |||||
| Fiscal 2027 | $ | 13,102 | |||
| Fiscal 2028 | 10,436 | ||||
| Fiscal 2029 | 10,408 | ||||
| Fiscal 2030 | 10,111 | ||||
| Fiscal 2031 | 9,281 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Apr 23, 2026 | Showing above |
| 2025 | Apr 24, 2025 | |
| 2024 | Apr 24, 2024 | |
| 2023 | Apr 27, 2023 | |
| 2022 | Apr 28, 2022 | |
| 2021 | Apr 29, 2021 | |
| 2020 | Apr 29, 2020 | |
| 2019 | Apr 29, 2019 | |
| 2018 | Apr 30, 2018 | |
| 2017 | May 1, 2017 | |
| 2016 | Apr 29, 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.