Vital Farms, Inc. Goodwill & Intangibles Disclosure
12. Goodwill and Other Assets
Goodwill and other assets consisted of the following as of the periods presented:
|
|
December 28, |
|
|
December 29, |
|
||
Goodwill |
|
$ |
3,858 |
|
|
$ |
3,858 |
|
Cloud computing implementation costs, net |
|
|
9,501 |
|
|
|
3,834 |
|
Deferred tax asset |
|
|
1,776 |
|
|
|
1,399 |
|
Other non-current assets |
|
|
62 |
|
|
|
62 |
|
Goodwill and other assets |
|
$ |
15,197 |
|
|
$ |
9,153 |
|
As of December 28, 2025 and December 29, 2024 the Company has capitalized costs of $12,849 and $4,206 relating to cloud computing arrangement implementation costs. Of this total, $9,501 and $3,834 are classified as non-current assets under the heading “goodwill and other assets”, including $668 and $0 of accumulated amortization, and $2,680 and $372 are classified as current assets under the heading “prepaid expenses and other current assets” as of December 28, 2025 and December 29, 2024, respectively. This software was developed by a third-party in conjunction with the Company’s employees. Amortization of the cloud computing arrangement implementation costs began once the software was placed in service in September 2025 and classified within “selling, general and administrative costs.”
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.