INTERFACE INCTILE
INTERFACE INC Segments Disclosure
SEGMENT INFORMATION
The Company determines that an operating segment exists if a component (i) engages in business activities from which it earns revenues and incurs expenses, (ii) has operating results that are regularly reviewed by the chief operating decision maker (“CODM”) and (iii) has discrete financial information. Additionally, accounting standards require the utilization of a “management approach” to report the financial results of operating segments, which is based on information used by the CODM to assess performance and make operating and resource allocation decisions. The Company determined that it has two operating segments organized by geographical area – namely (a) Americas (“AMS”) and (b) Europe, Africa, Asia and Australia (collectively “EAAA”). The AMS operating segment includes the United States, Canada and Latin America geographic areas.
Pursuant to the management approach discussed above, the Company’s CODM, our chief executive officer, evaluates performance at the AMS and EAAA operating segment levels and makes operating and resource allocation decisions based on segment adjusted operating income (“AOI”). The CODM uses AOI to evaluate segment operating results compared to expectations. AOI is also used by the CODM to develop variable compensation targets and make capital spend decisions. AOI excludes: nora purchase accounting amortization; restructuring, asset impairment, severance, and other, net; and the impact of the Cyber Event. Intersegment revenues for 2025, 2024 and 2023 were $122.0 million, $91.1 million and $82.8 million, respectively. Intersegment revenues are eliminated from net sales presented below since these amounts are not included in the information provided to the CODM.
The Company has determined that it has two reportable segments – AMS and EAAA, as each operating segment meets the quantitative thresholds defined in the accounting guidance.
During fiscal year 2024, the Company implemented a cost center realignment initiative to centralize certain global/shared functions. During 2024, SG&A expenses for these global support functions were allocated to AOI for each reportable segment consistent with the allocation methodology used to allocate corporate overhead in prior periods. AOI amounts below for fiscal year 2023, were not recast as there was no material impact to the measure of segment profit for each reportable segment. There were no changes to the composition of the Company’s operating or reportable segments.
The following table outlines information by reportable segment including net sales, significant segment expenses, and AOI. The table also includes a reconciliation to income before taxes for fiscal years 2025, 2024, and 2023.
| Fiscal Year | ||||||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||
| AMS | EAAA | TOTAL | AMS | EAAA | TOTAL | AMS | EAAA | TOTAL | ||||||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||||||||
| Net sales | $ | 843,886 | $ | 542,968 | $ | 1,386,854 | $ | 800,811 | $ | 514,847 | $ | 1,315,658 | $ | 736,955 | $ | 524,543 | $ | 1,261,498 | ||||||||||||||||||||
Less: significant segment expenses (1) | ||||||||||||||||||||||||||||||||||||||
Adjusted cost of sales(2) | 494,700 | 351,701 | 494,185 | 333,353 | 458,708 | 356,591 | ||||||||||||||||||||||||||||||||
Adjusted selling, general, & administrative expenses(3) | 211,887 | 154,811 | 200,032 | 146,691 | 190,458 | 139,344 | ||||||||||||||||||||||||||||||||
| Segment AOI | 137,299 | 36,456 | 173,755 | 106,594 | 34,803 | 141,397 | 87,789 | 28,608 | 116,397 | |||||||||||||||||||||||||||||
| Reconciliation of AOI to income before taxes | ||||||||||||||||||||||||||||||||||||||
| Restructuring, severance, asset impairment and other, net | 6,687 | 2,530 | 5,631 | |||||||||||||||||||||||||||||||||||
Purchase accounting amortization | 3,073 | 5,172 | 5,172 | |||||||||||||||||||||||||||||||||||
| Cyber Event impact | — | (711) | 1,072 | |||||||||||||||||||||||||||||||||||
| Interest expense | 19,546 | 23,205 | 31,787 | |||||||||||||||||||||||||||||||||||
Other expense (income), net | 7,598 | (2,353) | 9,081 | |||||||||||||||||||||||||||||||||||
| Income before taxes | $ | 136,851 | $ | 113,554 | $ | 63,654 | ||||||||||||||||||||||||||||||||
(1) Significant segment expense categories and amounts align with segment level information that is regularly provided to the CODM, included in the measure of segment profit, and considered to be significant. Amounts include allocation of corporate overhead and global support costs. Intersegment expenses are excluded.
(2) Adjusted cost of sales excludes nora purchase accounting amortization and the Cyber Event impact.
(3) Adjusted selling, general, and administrative expenses exclude the Cyber Event impact and restructuring, asset impairment, severance, and other, net.
Segment depreciation and amortization for 2025, 2024 and 2023 is presented in the table below:
| Fiscal Year | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (in thousands) | |||||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| AMS | $ | 18,792 | $ | 17,804 | $ | 17,989 | |||||||||||
| EAAA | 20,124 | 21,529 | 22,785 | ||||||||||||||
| Total depreciation and amortization | $ | 38,916 | $ | 39,333 | $ | 40,774 | |||||||||||
A reconciliation of the Company’s total operating segment assets to the corresponding consolidated amounts follows:
| End of Fiscal Year | |||||||||||
| 2025 | 2024 | ||||||||||
| (in thousands) | |||||||||||
| Assets | |||||||||||
| AMS | $ | 660,189 | $ | 644,085 | |||||||
| EAAA | 619,663 | 587,639 | |||||||||
| Total segment assets | 1,279,852 | 1,231,724 | |||||||||
| Corporate assets | 98,853 | 111,761 | |||||||||
| Eliminations | (172,183) | (172,669) | |||||||||
| Total reported assets | $ | 1,206,522 | $ | 1,170,816 | |||||||
The Company has a large and diverse customer base, which includes numerous customers located in foreign countries. No single unaffiliated customer accounted for more than 10% of total sales in any year during the past three years. Sales to customers in foreign markets in 2025, 2024 and 2023 were approximately 43%, 43% and 46%, respectively, of total net sales. These sales were primarily to customers in Europe, Canada, Asia, Australia and Latin America. Net sales and long-lived assets for the United States and other significant countries (that individually represent 10% or greater of consolidated totals for each year presented) are as follows:
| Fiscal Year | |||||||||||||||||
Net Sales to Unaffiliated Customers(1) | 2025 | 2024 | 2023 | ||||||||||||||
| (in thousands) | |||||||||||||||||
| United States | $ | 785,933 | $ | 744,407 | $ | 677,342 | |||||||||||
| Other foreign countries | 600,921 | 571,251 | 584,156 | ||||||||||||||
| Total net sales | $ | 1,386,854 | $ | 1,315,658 | $ | 1,261,498 | |||||||||||
| End of Fiscal Year | |||||||||||||||||
Long-Lived Assets(2) | 2025 | 2024 | |||||||||||||||
| (in thousands) | |||||||||||||||||
| United States | $ | 146,980 | $ | 151,130 | |||||||||||||
| Germany | 75,406 | 60,391 | |||||||||||||||
| Netherlands | 42,458 | 36,350 | |||||||||||||||
Australia | 31,326 | 24,380 | |||||||||||||||
| Other foreign countries | 13,279 | 10,123 | |||||||||||||||
| Total long-lived assets | $ | 309,449 | $ | 282,374 | |||||||||||||
(1) Revenue attributed to geographic areas is based on the location of the customer.
(2) Long-lived assets attributed to geographic areas are based on the physical location of the asset. 2025 includes $2.5 million and $6.6 million of leased equipment in the U.S. and in non-U.S. countries, respectively. 2024 includes $3.1 million and $5.0 million of leased equipment in the U.S. and in non-U.S. countries, respectively.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 26, 2025 | |
| 2023 | Feb 28, 2024 | |
| 2022 | Mar 2, 2022 | |
| 2021 | Mar 3, 2021 | |
| 2019 | Feb 26, 2020 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.