Company: MRCY
Filing Date: 2025-08-11
Form Type: 10-K
Source: 0001049521-25-000024
Chunk: 112

Company: MERCURY SYSTEMS INC
Filing Date: 2025-08-11
Form: 10-K
Item: Item 8
Chunk 112
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 estimated useful life or lease term74,278 72,420 Machinery and equipment5-10168,412 150,991 415,208 383,471 Less: accumulated depreciation(313,768)(273,118)Property and equipment, net$101,440 $110,353 The $8,913 decrease in Property and equipment, net was primarily due to depreciation expense and was partially offset by current year additions of $19,803. During fiscal 2025 and 2024, the Company retired $991 and $1,308, respectively, of computer equipment and software, furniture and fixtures, leasehold improvements, and machinery and equipment that were no longer in use by the Company. Depreciation expense related to property and equipment for the fiscal years ended June 27, 2025, June 28, 2024 and June 30, 2023 was $39,178, $40,369 and $43,777, respectively.

F.Goodwill

    In accordance with FASB ASC 350, Intangibles-Goodwill and Other (“ASC 350”), the Company determines its reporting units based upon whether discrete financial information is available, if management regularly reviews the operating results of the component, the nature of the products offered to customers and the market characteristics of each reporting unit. A reporting unit is considered to be an operating segment or one level below an operating segment also known as a component. Component level financial information is reviewed by management across two reporting units: Mission Systems and Microelectronics. Accordingly, these were determined to be the Company's reporting units which is consistent with the prior period. There were no adjustments to the carrying value of Goodwill during fiscal 2025 and 2024.The Company performed its annual goodwill impairment test in the fourth quarter of fiscal 2025. Based on the quantitative evaluation, the Company determined that the Mission Systems and Microelectronics reporting units had estimated fair values that substantially exceeded their carrying values. The Company concluded that its goodwill was not impaired. The Company is required to perform the next annual goodwill impairment analysis during the fourth quarter of fiscal year 2026. Adverse changes to the underlying information assumptions used in its assessment of potential triggering events could require the Company to perform an interim impairment test. If assumed revenue growth rate and cash flow projections are not achieved in future periods or the Company’s common stock price significantly declines from current levels, among other factors, its Mission Systems and Microelectronics reporting units could be at