Company: ALIT
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-049916
Chunk: 5

Company: Alight, Inc. / Delaware
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 5
---
 prior year period.

Goodwill Impairment

During the three months ended September 30, 2025, the Company identified interim indicators of impairment and recorded a $1,338 million non-cash impairment charge for the period.  There was no impairment recognized for the three months ended  September 30, 2024. See Note 6 "Goodwill and Intangible assets, net" within the Condensed Consolidated Financial Statements for additional information.

Change in Fair Value of Financial Instruments

There was a $19 million gain related to the change in the fair value of financial instruments for the three months ended September 30, 2025 compared to a gain of $23 million for the prior year period. We are required to remeasure the financial instruments at the end of each reporting period and reflect a gain or loss for the change in fair value of the financial instruments in the period the change occurred. Changes in the fair value are primarily due to changes in the underlying assumptions of each respective instrument, including changes in the risk-free interest rate, volatility, cost of debt, forecasts, and the closing stock price for the period. See Note 14 "Financial Instruments" within the Condensed Consolidated Financial Statements for additional information. 

Change in Fair Value of Tax Receivable Agreement

The change in the fair value of the TRA resulted in a gain of $66 million for the three months ended September 30, 2025, an increase of $93 million compared to a loss of $27 million for the prior year period. The change in fair value was due to changes in the Company's assumptions related to the timing of the utilization of tax attributes during the term of the TRA, changes in the discount rate and the passage of time.

Interest Expense

Interest expense increased $5 million for the three months ended September 30, 2025, as compared to the prior year period. The increase was primarily due to lower interest income in the current year and a non-cash gain on extinguishment from the partial debt paydown in 2024.

Other (Income) Expense, net

Under the terms of the TSA as described in Note 4 "Discontinued Operations" within the Condensed Consolidated Financial Statements, the Company is providing technology infrastructure, risk and security, and various other corporate services to the Divested Business subsequent to the close. We recorded $7 million and $9 million for services performed under the TSA for the three months ended September 30, 2025 and 2024,