Quarterly report [Sections 13 or 15(d)]

GOODWILL AND INTANGIBLE ASSETS

v3.26.3
GOODWILL AND INTANGIBLE ASSETS
 9 Months Ended
Oct. 03, 2026
Intangible Asset, Goodwill and Other [Abstract]  
GOODWILL AND INTANGIBLE ASSETS
NOTE C – GOODWILL AND INTANGIBLE ASSETS
Goodwill
During the second quarter of 2026, the Company identified a potential impairment indicator within its Hiya reporting unit related to current lower-than-expected financial performance and changes in the near-term forecast. As such, the Company performed a quantitative impairment analysis. Based on the results of this analysis, the Company concluded that the estimated fair value of its Hiya reporting unit was less than its carrying value. The fair value of the Hiya reporting unit was determined using a combination of an income approach, which estimates fair value based upon projected financial information discounted to present values, and a market approach based on guideline public companies (level 3 measurement).
These methods involve the use of significant estimates, assumptions, and judgments by management. The principal assumptions used in this analysis consisted of management’s best estimates of future financial results including revenue growth rates and profitability margins, an appropriate discount rate to apply to projected cash flows, and selection
and weighting of market multiples. The impairment resulted primarily from changes to projected financial information, as well as adjustments to market multiples and discount rates to reflect current facts and circumstances.
As a result, the Company recorded a non-cash goodwill impairment charge of $29,137 for the Hiya reporting unit during the second quarter of 2026, included in the “Goodwill impairment” line item of the condensed consolidated statements of comprehensive income. For all other reporting units, the Company identified no indicators that it was more likely than not that their fair values were less than their carrying values.
The Company performed its annual goodwill impairment test as of October 3, 2026. The Company performed a qualitative assessment of each reporting unit and determined that it was not more-likely-than-not that the fair value of any reporting unit was less than its carrying amount. As a result, no impairment of goodwill was recognized during the three months ended October 3, 2026.
The Company’s market capitalization has been, and may continue to be, volatile. Although the Company's analysis did not result in an impairment of goodwill as of October 3, 2026, continuing volatility in the Company’s stock price and resulting market capitalization or a significant reduction in the Company's projected cash flows could result in a non-cash impairment charge in a future period.
The changes in the carrying amount of goodwill during the nine months ended October 3, 2026, including by reportable segment are as follows:
Core Nutritional Hiya Rise Total
Balance as of January 3, 2026 (1)
Gross goodwill $ 16,670  $ 127,374  $ 445  $ 144,489 
Accumulated impairment losses (6,527) —  —  (6,527)
Net goodwill as of January 3, 2026 10,143  127,374  445  137,962 
Impairment —  (29,137) —  (29,137)
Currency translation adjustment 437  —  —  437 
Balance as of October 3, 2026
Gross goodwill 17,107  127,374  445  144,926 
Accumulated impairment losses (6,527) (29,137) —  (35,664)
Net goodwill as of October 3, 2026 $ 10,580  $ 98,237  $ 445  $ 109,262 
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(1)January 3, 2026 reflects the recast of previously reported goodwill by reportable segment to conform to the Company's reorganized reportable segments, effective January 4, 2026, See Note A and Note K.
Intangibles
The Company also performed its annual indefinite-lived intangible asset impairment test as of October 3, 2026. The Company performed a qualitative assessment of the indefinite-lived intangible asset and determined that it was not more-likely-than-not that the fair value of the indefinite-lived intangible asset was less than the carrying amount. As a result, no impairment of the indefinite-lived intangible asset was recognized.