Company: KHC
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0001637459-25-000152
Chunk: 92

Company: Kraft Heinz Co
Filing Date: 2025-07-30
Form: 10-Q
Item: Part I, Item 8
Chunk 92
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Note 7.  Goodwill and Intangible Assets

Goodwill:Changes in the carrying amount of goodwill, by segment, were (in millions):North AmericaInternational Developed MarketsEmerging MarketsTotalBalance at December 28, 2024$26,232 $2,134 $307 $28,673 Impairment losses(5,875)(819)— (6,694)Translation adjustments and other35 207 5 247 Balance at June 28, 2025$20,392 $1,522 $312 $22,226 Q2 2025 Goodwill Impairment TestingDuring the second quarter of 2025, we concluded that the sustained decline in our share price and market capitalization was a triggering event requiring an interim goodwill impairment assessment for all reporting units. We performed an interim impairment test (“Q2 Impairment Test”) as of the last day of our second quarter, June 28, 2025, and utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.As a result of our Q2 Impairment Test, we recognized non-cash goodwill impairment losses of $6.7 billion in SG&A in the second quarter of 2025, of which $3.1 billion related to our Taste Elevation, Ready Meals and Snacking (“TMS”) reporting unit, $1.6 billion related to our Meat & Cheese (“MC”) reporting unit, $805 million related to our Canada and North America Coffee (“CNAC”) reporting unit, and $400 million related to our Away from Home & Kraft Heinz Ingredients (“AFH”) reporting unit within our North America segment, as well as $819 million related to our Western Europe (“WE”) reporting unit within our International Developed Markets segment.The impairments of our TMS, AFH, WE, MC, and CNAC reporting units were primarily due to the market’s perceived risk of our ability to achieve our future cash flow projections, due, in part, to uncertainty in the macroeconomic environment in which we operate. The impairment of our MC reporting unit was also partially driven by a reduction of future long-term growth assumptions. After these impairments, the goodwill carrying amount is $12.8 billion in our TMS reporting unit, $2.3 billion in our AFH reporting unit, $1.5 billion in our WE reporting unit,