STERLING INFRASTRUCTURE, INC.STRL

STERLING INFRASTRUCTURE, INC. Goodwill & Intangibles Disclosure

10-KFiled Feb 26, 20263 min read
8.GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill
    Reporting Units—The Company’s reporting units consist of its E-Infrastructure Solutions, Transportation Solutions and Building Solutions segments. Goodwill is not amortized, but instead is reviewed for impairment at least annually during the fourth quarter of each year at the reporting unit level, absent any interim indicators of impairment or other factors requiring an assessment.
Annual Impairment Assessment—For our 2025 annual impairment test we performed a qualitative assessment for our reporting units, using information as of October 1. Under current guidance, we are permitted to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform a quantitative goodwill impairment test. We determined there were no factors indicating the need to perform a quantitative goodwill impairment test and concluded that it is more likely than not the fair value of our reporting units is greater than their carrying value and thus there was no impairment to goodwill. In addition to our annual review, we assess the impairment of goodwill whenever events or changes in circumstances indicate that the carrying value of a reporting unit may be greater than fair value. Factors that could trigger an interim impairment review include, but are not limited to, significant adverse changes in the business climate which may be indicated by a decline in our market capitalization or decline in operating results. No impairments were recorded to our goodwill during the years ended December 31, 2025, 2024 and 2023. No material events or changes occurred between the testing date and year end to trigger a subsequent impairment review.
The changes in the carrying amount of goodwill by reportable segment were as follows:
E-Infrastructure Solutions
Transportation Solutions
Building Solutions
Total
Balance at December 31, 2023 (1)
$167,656 $53,305 $60,156 $281,117 
Goodwill derecognized from deconsolidation (2)
— (18,875)— (18,875)
Goodwill recognized from acquisitions
— — 2,355 2,355 
Balance at December 31, 2024 (1)
167,656 34,430 62,511 264,597 
Goodwill recognized from acquisitions314,459 — 6,165 320,624 
Balance at December 31, 2025 (1)
$482,115 $34,430 $68,676 $585,221 
(1) Included in the Transportation Solutions segment for the years ended December 31, 2025, 2024 and 2023, was an accumulated impairment of approximately $42,000, $42,000, and $67,000, respectively. During the year ended December 31, 2024, approximately $25,000 of accumulated impairment was written off due to the deconsolidation of our 50% owned RHB subsidiary.
(2) The decrease in Transportation Solutions goodwill in 2024 is due to the deconsolidation of our 50% owned RHB subsidiary. See Note 2 - Basis of Presentation and Significant Accounting Policies “50% Owned Subsidiary” for more information.
Other Intangible Assets
The following table presents our acquired finite-lived intangible assets, including the weighted-average useful lives for each major intangible asset category and in total:
 December 31, 2025December 31, 2024
 Weighted
Average
Life (Years)		Gross
Carrying
Amount
Accumulated
Amortization		Gross
Carrying
Amount
Accumulated
Amortization
Customer relationships24$519,483 $(82,344)$333,183 $(63,717)
Trade name24133,077 (15,514)58,877 (11,953)
Total24$652,560 $(97,858)$392,060 $(75,670)
During the years ended December 31, 2025, 2024 and 2023, we have amortized $22,188, $17,037 and $15,226, respectively, of intangible assets. Amortization expense is anticipated to be approximately $28,300 annually for 2026 through 2030.

Historical Timeline

Fiscal YearFiled
2025Feb 26, 2026Showing above
2024Feb 26, 2025
2023Feb 27, 2024
2022Feb 28, 2023
2021Mar 1, 2022
2020Mar 3, 2021
2019Mar 3, 2020
2018Mar 5, 2019
2017Mar 6, 2018

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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