MOHAWK INDUSTRIES INCMHK
MOHAWK INDUSTRIES INC Goodwill & Intangibles Disclosure
Goodwill and Other Intangible Assets
The Company performs its annual testing of goodwill and indefinite-lived intangibles on the first day of the fourth quarter of each year. Between annual testing dates, the Company monitors factors such as its market capitalization, comparable company market multiples and macroeconomic conditions to identify conditions that could impact the Company’s assumptions utilized in the determination of the estimated fair values of the Company’s reporting units and indefinite-lived intangible assets significantly enough to trigger an impairment.
The goodwill impairment tests are based on determining the fair value of the specified reporting units based on management judgments and assumptions using the discounted cash flows under the income approach classified in Level 3 of the fair value hierarchy and comparable company market valuation classified in Level 2 of the fair value hierarchy approaches. The Company has identified Global Ceramic, Flooring NA and Flooring ROW as its reporting units for the purposes of allocating goodwill and intangibles at the asset level, as well as assessing impairments. The valuation approaches are subject to key judgments and assumptions that are sensitive to change such as judgments and assumptions about appropriate sales growth rates, operating margins, weighted average cost of capital (“WACC”) and comparable company market multiples.
The Company compared the estimated fair values of its indefinite-lived intangibles to their carrying values and determined that there were charges of $19.9 million ($14.9 million net of tax) in Flooring Rest of the World Segment during the fourth quarter of 2025 and $8.2 million ($6.3 million net of tax) in Global Ceramic Segment during the fourth quarter of 2024.
A significant or prolonged deterioration in economic conditions, continued increases in the costs of raw materials and energy combined with an inability to pass these costs on to customers, a further decline in the Company’s market capitalization or comparable company market multiples, projected future cash flows, or increases in the WACC, could impact the Company’s assumptions and require a reassessment of goodwill or indefinite-lived intangible assets for impairment in future periods. Future declines in estimated after tax cash flows, increases in the WACC or a decline in market capitalization could result in an additional indication of impairment in one or more of the Company’s reporting units.
The following tables summarize the components of goodwill and intangible assets:
Goodwill:
| (In millions) | Global Ceramic | Flooring NA | Flooring ROW | Total | |||||||||||||||||||
Balances as of December 31, 2023 (1) | $ | — | 372.3 | 787.4 | 1,159.7 | ||||||||||||||||||
| Goodwill recognized | — | — | — | — | |||||||||||||||||||
| Impairment charges | — | — | — | — | |||||||||||||||||||
| Currency translation | — | — | (47.6) | (47.6) | |||||||||||||||||||
| Balances as of December 31, 2024 | — | 372.3 | 739.8 | 1,112.1 | |||||||||||||||||||
| Goodwill recognized | — | 7.6 | — | 7.6 | |||||||||||||||||||
| Impairment charges | — | — | — | — | |||||||||||||||||||
| Currency translation | — | — | 90.6 | 90.6 | |||||||||||||||||||
| Balances as of December 31, 2025 | $ | — | 379.9 | 830.4 | 1,210.3 | ||||||||||||||||||
(1) Net of accumulated impairment losses of $2,886.7 ($1,644.7 in Global Ceramic, $557.9 in Flooring NA and $684.1 in Flooring ROW).
Intangible assets:
| (In millions) | Tradenames | ||||
| Indefinite life assets not subject to amortization: | |||||
| Balance as of December 31, 2023 | $ | 705.7 | |||
| Intangible assets acquired | — | ||||
| Intangible assets impaired | (8.2) | ||||
| Currency translation | (39.7) | ||||
| Balance as of December 31, 2024 | 657.8 | ||||
| Intangible assets acquired | 0.4 | ||||
| Intangible assets impaired | (19.9) | ||||
| Currency translation | 57.5 | ||||
| Balance as of December 31, 2025 | $ | 695.8 | |||
| (In millions) | Customer Relationships | Patents | Other | Total | |||||||||||||||||||
| Intangible assets subject to amortization: | |||||||||||||||||||||||
| Balances as of December 31, 2023 | |||||||||||||||||||||||
| Gross carrying amount | $ | 691.5 | 249.7 | 8.7 | 949.9 | ||||||||||||||||||
| Accumulated amortization | (531.0) | (247.2) | (2.1) | (780.3) | |||||||||||||||||||
| Net intangible assets subject to amortization | 160.5 | 2.5 | 6.6 | 169.6 | |||||||||||||||||||
| Balances as of December 31, 2024 | |||||||||||||||||||||||
| Gross carrying amount | 662.4 | 235.4 | 8.5 | 906.3 | |||||||||||||||||||
| Accumulated amortization | (536.3) | (233.6) | (2.3) | (772.2) | |||||||||||||||||||
| Net intangible assets subject to amortization | 126.1 | 1.8 | 6.2 | 134.1 | |||||||||||||||||||
| Balances as of December 31, 2025 | |||||||||||||||||||||||
| Gross carrying amount | 716.2 | 265.8 | 9.1 | 991.1 | |||||||||||||||||||
| Intangible assets acquired | — | — | 0.9 | 0.9 | |||||||||||||||||||
| Accumulated amortization | (607.2) | (264.5) | (2.9) | (874.6) | |||||||||||||||||||
| Net intangible assets subject to amortization | $ | 109.0 | 1.3 | 7.1 | 117.4 | ||||||||||||||||||
| For the Years Ended December 31, | |||||||||||||||||
| (In millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Amortization expense | $ | 28.3 | 27.6 | 28.3 | |||||||||||||
Estimated amortization expense for the years ending December 31 are as follows:
| (In millions) | Amount | ||||
| 2026 | $ | 29.9 | |||
| 2027 | 21.7 | ||||
| 2028 | 13.2 | ||||
| 2029 | 11.3 | ||||
| 2030 | 9.0 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 24, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 23, 2022 | |
| 2020 | Feb 24, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Feb 27, 2017 | |
| 2015 | Feb 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.