GEE Group Inc. Goodwill & Intangibles Disclosure

8. Goodwill and Intangible Assets                                                                                

Goodwill

For purposes of performing its annual goodwill impairment assessments as of September 30, 2025 and 2024, the Company applied the valuation techniques and assumptions to its Professional Segment reporting unit as discussed in Note 2, above; and also considered recent trends in the Company’s stock price, implied control or acquisition premiums, earnings, and other possible factors and their effects on estimated fair value of the Company’s reporting unit.

The Company completed its most recent annual goodwill impairment assessment as of September 30, 2025 and determined that its goodwill was not further impaired. Prior to this, as of March 31, 2025, an interim assessment was performed as the estimated fair value of the Professional Services reporting unit was determined to have decreased and indicated that the reporting unit’s carrying value exceeded its estimated fair value. As a result, a non-cash goodwill impairment charge of $22,000 was recognized during fiscal 2025, as determined by the interim evaluation made of our goodwill as of March 31, 2025.

Upon completion of the prior annual goodwill impairment assessment as of September 30, 2024, it was determined that the Company’s goodwill was not further impaired. In fiscal 2024, an interim assessment was also performed due to the decline in operating results and market capitalization experienced during the year which, in management’s view, represented one or more triggering events that could indicate an impairment in the Company’s goodwill. The interim assessment was performed as of June 30, 2024 and indicated the goodwill assigned to the Professional Services reporting unit was impaired. As a result, a non-cash goodwill impairment charge of $14,201 was recognized during fiscal 2024, as determined by the interim evaluation made of our goodwill as of June 30, 2024.

A summary of goodwill balances is presented as follows:

The estimated fair value of the Professional Services reporting unit resulting from the September 30, 2025 assessment exceeded the reporting unit’s adjusted carrying value, net of the impairment recorded during the March 31, 2025 interim assessment, by approximately 39%, or approximately $12.7 million. Should industry conditions remain consistently negative, or worsen, or if assumptions such as control premiums, revenue growth projections, cost reduction projections, cost of capital or discount rates or business enterprise value multiples change such conditions could result in a deficit of the fair value of the Company’s Professional Services reporting unit as compared to its remaining carrying value, leading to an impairment in the future.

Intangible Assets

The following tables set forth the costs, accumulated amortization and net book value of the Company’s separately identifiable intangible assets as of September 30, 2025 and September 30, 2024 and estimated future amortization expense.

Intangible assets that represent customer relationships are amortized on the basis of estimated future undiscounted cash flows or using the straight-line basis over estimated remaining useful lives of five to ten years. Non-competes and trade names are amortized on a straight-line basis over their respective estimated useful lives of between two and ten years.

Due to the presence of negative macroeconomic conditions impacting U.S. staffing firms, including ours, and related reductions to the Company’s forecasts of future results, the Company performed an evaluation of its intangible assets as of June 30, 2024, using the undiscounted cash flows method. In performing this evaluation, it was determined that certain asset groups associated with the Company’s intangible assets were producing negative or sufficiently low gross cash flows and that their estimated future discounted cash flows indicated impairments of the remaining unamortized balances. As a result, the Company recorded a non-cash impairment charge of $5,209 on intangible assets during fiscal 2024.