Yum China Holdings, Inc. Goodwill & Intangibles Disclosure
Note 7 – Goodwill and Intangible Assets
The changes in the carrying amount of goodwill are as follows:
|
|
Total Company |
|
|
KFC |
|
|
Pizza Hut |
|
|
All Other Segments |
|
||||
Balance as of December 31, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Goodwill, gross |
|
$ |
2,323 |
|
|
$ |
1,840 |
|
|
$ |
18 |
|
|
$ |
465 |
|
Accumulated impairment losses(a) |
|
|
(391 |
) |
|
|
— |
|
|
|
— |
|
|
|
(391 |
) |
Goodwill, net |
|
$ |
1,932 |
|
|
$ |
1,840 |
|
|
$ |
18 |
|
|
$ |
74 |
|
Effect of currency translation adjustments |
|
|
(52 |
) |
|
|
(50 |
) |
|
|
— |
|
|
|
(2 |
) |
Balance as of December 31, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Goodwill, gross |
|
|
2,271 |
|
|
|
1,790 |
|
|
|
18 |
|
|
|
463 |
|
Accumulated impairment losses(a) |
|
|
(391 |
) |
|
|
— |
|
|
|
— |
|
|
|
(391 |
) |
Goodwill, net |
|
$ |
1,880 |
|
|
$ |
1,790 |
|
|
$ |
18 |
|
|
$ |
72 |
|
Effect of currency translation adjustments |
|
|
83 |
|
|
|
80 |
|
|
|
1 |
|
|
|
2 |
|
Balance as of December 31, 2025 |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Goodwill, gross |
|
|
2,354 |
|
|
|
1,870 |
|
|
|
19 |
|
|
|
465 |
|
Accumulated impairment losses(a) |
|
|
(391 |
) |
|
|
— |
|
|
|
— |
|
|
|
(391 |
) |
Goodwill, net |
|
$ |
1,963 |
|
|
$ |
1,870 |
|
|
$ |
19 |
|
|
$ |
74 |
|
Intangible assets, net as of December 31, 2025 and 2024 are as follows:
|
|
2025 |
|
|
2024 |
|
||||||||||||||||||||||||||
|
|
Gross Carrying |
|
|
Accumulated |
|
|
Accumulated Impairment Losses(b) |
|
|
Net Carrying Amount |
|
|
Gross Carrying |
|
|
Accumulated |
|
|
Accumulated Impairment Losses(b) |
|
|
Net Carrying Amount |
|
||||||||
Finite-lived intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reacquired franchise rights |
|
$ |
274 |
|
|
$ |
(271 |
) |
|
$ |
— |
|
|
$ |
3 |
|
|
$ |
262 |
|
|
$ |
(259 |
) |
|
$ |
— |
|
|
$ |
3 |
|
Huang Ji Huang franchise |
|
|
21 |
|
|
|
(7 |
) |
|
|
— |
|
|
|
14 |
|
|
|
20 |
|
|
|
(5 |
) |
|
|
— |
|
|
|
15 |
|
Daojia platform |
|
|
9 |
|
|
|
(2 |
) |
|
|
(7 |
) |
|
|
— |
|
|
|
9 |
|
|
|
(2 |
) |
|
|
(7 |
) |
|
|
— |
|
Customer-related assets |
|
|
11 |
|
|
|
(10 |
) |
|
|
(1 |
) |
|
|
— |
|
|
|
11 |
|
|
|
(10 |
) |
|
|
(1 |
) |
|
|
— |
|
Other |
|
|
9 |
|
|
|
(6 |
) |
|
|
— |
|
|
|
3 |
|
|
|
8 |
|
|
|
(5 |
) |
|
|
— |
|
|
|
3 |
|
|
|
$ |
324 |
|
|
$ |
(296 |
) |
|
$ |
(8 |
) |
|
$ |
20 |
|
|
$ |
310 |
|
|
$ |
(281 |
) |
|
$ |
(8 |
) |
|
$ |
21 |
|
Indefinite-lived intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Little Sheep trademark |
|
$ |
51 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
51 |
|
|
$ |
49 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
49 |
|
Huang Ji Huang trademark |
|
|
77 |
|
|
|
— |
|
|
|
— |
|
|
|
77 |
|
|
|
74 |
|
|
|
— |
|
|
|
— |
|
|
|
74 |
|
|
|
$ |
128 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
128 |
|
|
$ |
123 |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
123 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Total intangible assets |
|
$ |
452 |
|
|
$ |
(296 |
) |
|
$ |
(8 |
) |
|
$ |
148 |
|
|
$ |
433 |
|
|
$ |
(281 |
) |
|
$ |
(8 |
) |
|
$ |
144 |
|
Amortization expense for finite-lived intangible assets was $2 million in 2025, $2 million in 2024 and $4 million in 2023. Amortization expense for finite-lived intangible assets is expected to approximate $2 million in each of 2026, 2027, 2028, 2029 and 2030.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 29, 2024 | |
| 2022 | Mar 1, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 27, 2020 | |
| 2018 | Feb 27, 2019 | |
| 2017 | Feb 27, 2018 | |
| 2016 | Mar 8, 2017 | |
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.