ON SEMICONDUCTOR CORPON

ON SEMICONDUCTOR CORP Goodwill & Intangibles Disclosure

10-KFiled Feb 9, 20262 min read
Note 6: Goodwill and Intangible Assets

Goodwill

Goodwill is tested for impairment annually on the first day of the fourth quarter or more frequently if events or changes in circumstances (each, a "triggering event") would more-likely-than-not reduce the fair value of a reporting unit below its carrying value. For the year ended December 31, 2025, the Company performed a quantitative goodwill assessment as of the first day of its fourth fiscal quarter. The estimated fair values of each of the Company's reporting units were in excess of their carrying values and none of the reporting units were considered at risk for impairment.
The following table summarizes goodwill by operating and reportable segments (in millions):
 As of December 31, 2025As of December 31, 2024
Operating and Reportable SegmentsGoodwillAccumulated Impairment LossesCarrying ValueGoodwillAccumulated Impairment LossesCarrying Value
AMG$1,600.6 $(748.9)$851.7 $1,562.3 $(748.9)$813.4 
PSG735.8 (31.9)703.9 682.1 (31.9)650.2 
ISG124.3 — 124.3 124.3 — 124.3 
Total$2,460.7 $(780.8)$1,679.9 $2,368.7 $(780.8)$1,587.9 

The following table summarizes the change in goodwill (in millions):
Net balance as of December 31, 20241,587.9 
Addition due to business acquisitions92.0 
Net balance as of December 31, 2025$1,679.9 

Intangible Assets

Intangible assets, net, were as follows (in millions):
 As of December 31, 2025
 Original
Cost		Accumulated
Amortization		Accumulated Impairment LossesCarrying
Value
Customer relationships$582.7 $(488.3)$(36.3)$58.1 
Developed technology1,046.8 (771.8)(40.7)234.3 
IPRD32.0 — — 32.0 
Licenses35.0 (15.5)— 19.5 
Other intangibles80.1 (64.9)(15.2)— 
Total$1,776.6 $(1,340.5)$(92.2)$343.9 

 As of December 31, 2024
 Original
Cost		Accumulated
Amortization		Accumulated Impairment LossesCarrying
Value
Customer relationships$581.7 $(483.5)$(36.3)$61.9 
Developed technology956.3 (739.7)(40.7)175.9 
Licenses30.0 (9.9)— 20.1 
Other intangibles79.1 (63.9)(15.2)— 
Total$1,647.1 $(1,297.0)$(92.2)$257.9 

Amortization of intangible assets amounted to $49.5 million, $58.3 million and $56.8 million for the years ended December 31, 2025, 2024 and 2023, respectively.
Amortization expense for intangible assets, with the exception of the $32.0 million of IPRD assets that will be amortized once the corresponding projects have been completed, is expected to be as follows over the next five years, and thereafter (in millions):

2026$46.2 
202746.8 
202854.1 
202952.2 
203047.8 
Thereafter64.8 
Total estimated amortization expense$311.9 

Historical Timeline

Fiscal YearFiled
2025Feb 9, 2026Showing above
2024Feb 10, 2025
2023Feb 5, 2024
2022Feb 6, 2023
2021Feb 14, 2022
2020Feb 16, 2021
2019Feb 19, 2020
2018Feb 20, 2019
2017Feb 21, 2018
2016Feb 28, 2017
2015Feb 24, 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.

Other Available Disclosures

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