Acuity Inc.

10/23/2026 | Press release | Distributed by Public on 10/23/2026 06:15

Annual Report for Fiscal Year Ending August 31, 2026 (Form 10-K)

Management's Discussion and Analysis of Financial Condition and Results of Operations.
The purpose of this discussion and analysis is to enhance the understanding and evaluation of the results of operations, financial position, cash flows, indebtedness, and other key financial information of Acuity Inc. (referred to herein as "we," "our," "us," the "Company," or similar references) and its subsidiaries for the fiscal years ended August 31, 2026 and 2025. The following discussion should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements included within this report.
A discussion of the year ended August 31, 2025 compared to the year ended August 31, 2024 can be found within Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations within our fiscal 2025 Annual Report on Form 10-K filed with the Securities and Exchange Commission on October 27, 2025.
Overview
Company
Acuity Inc. is a market-leading industrial technology company. We use technology to solve problems in spaces, light, and more things to come. Through our two business segments, Acuity Brands Lighting ("ABL") and Acuity Intelligent Spaces ("AIS"), we design, manufacture, and bring to market products and services that make a valuable difference in people's lives. We achieve growth through the development of innovative new products and services, including lighting, lighting controls, building management solutions, and an audio, video, and control platform. We focus on customer outcomes and drive growth and productivity to increase market share and deliver superior returns. We look to aggressively deploy capital to grow the business and to enter attractive new verticals.
Financial Condition, Capital Resources, and Liquidity
We have numerous sources of capital, including cash on hand and cash flows generated from operations, as well as various sources of financing. Our ability to generate sufficient cash flows from operations or to access certain capital markets, including banks, is necessary to meet our capital allocation priorities, which are to invest in our current business for growth, to invest in mergers and acquisitions, to pay a dividend, and to make share repurchases. Sufficient cash flow generation is also critical to fund our operations in the short and long term and to maintain compliance with covenants contained in our financing agreements.
Our significant contractual cash requirements as of August 31, 2026 primarily include principal and interest on outstanding debt, accounts payable, accrued employee compensation, operating lease liabilities, and certain purchase obligations incurred in the ordinary course of business that are enforceable and legally binding. Further details on our borrowings and operating lease liabilities are outlined in the Debt and Lines of Credit, Leases, and Subsequent Event footnotes of the Notes to Consolidated Financial Statements within this Annual Report on Form 10-K.
Contractual purchase obligations of $450.2 million at August 31, 2026 are due in fiscal 2027. Contractual purchase obligations beyond fiscal 2027 are not significant.
We believe that we will be able to meet our liquidity needs over the next 12 months based on our cash on hand, current projections of cash flows from operations, borrowing availability under financing arrangements, and current access to capital markets. Additionally, we believe that our cash flows from operations and sources of funding, including, but not limited to, future borrowings and borrowing capacity, will sufficiently support our long-term liquidity needs. In the event of a sustained market deterioration, we may need additional capital, which would require us to evaluate available alternatives and take appropriate actions.
Cash
Our cash position at August 31, 2026 was $636.3 million, an increase of $213.8 million from August 31, 2025. Cash generated from operating activities and cash on hand were used during the current fiscal year to voluntarily repay borrowings as well as to fund our capital allocation priorities as discussed below.
We generated $825.6 million of cash flows from operating activities during fiscal 2026 compared with $601.4 million in the prior-year period, an increase of $224.2 million. Cash flows from operations increased due primarily to higher profit, including $51.3 million of received tariff refunds, and lower income tax payments.
Financing Arrangements
See the Debt and Lines of Credit footnote of the Notes to Consolidated Financial Statements within this Annual Report on Form 10-K for discussion of the terms of our various financing arrangements, including the 2.150% senior unsecured notes due December 15, 2030 (the "Unsecured Notes"), and our five-year credit agreement ("Credit Agreement") set to expire May 8, 2031.
At August 31, 2026, our outstanding debt balance was $697.4 million, which consisted of our Unsecured Notes and borrowings on our revolving credit facility under the Credit Agreement, compared to our cash position of $636.3 million. We were in compliance with all covenants under our financing arrangements as of August 31, 2026.
The Unsecured Notes were issued by Acuity Brands Lighting, Inc., a wholly-owned subsidiary of Acuity Inc. The Unsecured Notes are fully and unconditionally guaranteed on a senior unsecured basis by Acuity Inc. and ABL IP Holding LLC, a wholly-owned subsidiary of Acuity Inc. The following tables present summarized financial information for Acuity Inc., Acuity Brands Lighting, Inc., and ABL IP Holding LLC on a combined basis after the elimination of all intercompany balances and transactions between the combined group as well as any investments in non-guarantors as of the dates and during the period presented (in millions):
Summarized Balance Sheet Information August 31, 2026 August 31, 2025
Current assets $ 1,152.8 $ 1,068.2
Current assets due from non-guarantor affiliates - 303.5
Non-current assets 1,354.8 1,369.4
Current liabilities 786.9 604.0
Amounts due to non-guarantor affiliates 100.2 -
Non-current liabilities 751.2 1,138.4
Summarized Income Statement Information Year Ended August 31, 2026
Net sales $ 3,361.8
Gross profit 1,508.4
Net income 360.5
During fiscal 2026, we repaid our outstanding term loan using cash on hand and proceeds from our Credit Agreement entered into on May 8, 2026. At August 31, 2026, we had $200.0 million in remaining borrowings under our Credit Agreement. In September 2026, subsequent to the end of fiscal 2026, we voluntarily repaid this balance.
At August 31, 2026, we had additional borrowing capacity under the Credit Agreement of $593.3 million under the most restrictive covenant in effect at the time, which represents the full amount of borrowing capacity under the Credit Agreement of $800.0 million less outstanding borrowings of $200.0 million and letters of credit of $6.7 million, primarily for securing collateral requirements under our casualty insurance policies. As of August 31, 2026, our cash on hand combined with the additional borrowing capacity under the revolving credit facility totaled $1.2 billion.
Capital Allocation Priorities
Our capital allocation priorities are to invest in our current business for growth, to invest in mergers and acquisitions, to pay a dividend, and to make share repurchases.
Investments in Current Business for Growth
We invested $77.7 million and $68.4 million in property, plant, and equipment in fiscal 2026 and 2025, respectively. We invested primarily in new and enhanced information technology, equipment, tooling, and facility improvements in fiscal 2026.
Strategic Acquisitions, Investments, and Divestitures
We seek opportunities to strategically expand and enhance our portfolio of solutions. Refer to the Acquisitions and Divestitures footnote of the Notes to Consolidated Financial Statements for more information.
QSC, LLC
On January 1, 2025, we acquired all of the equity interests of QSC, a leader in the design, engineering, and manufacturing of audio, video, and control solutions and services, for $1.2 billion. This acquisition expanded AIS into a cloud-manageable audio, video, and control platform that includes controls, sensors, and software with broad applications across multiple end-markets including education, commercial, hospitality, government, healthcare, and transportation. We funded the transaction using cash on hand and proceeds from our term loan facility. The operating results, assets, liabilities, and cash flows of QSC have been included in our consolidated financial statements since the date of acquisition.
M3 Innovation, LLC
On May 1, 2025, we acquired certain assets of M3 Innovation, LLC, a sports lighting startup that uses innovative technology to lower the overall cost of the installation and operation of sports lighting solutions. The assets have been included in ABL's financial results since the date of acquisition and did not have a material impact to our financial condition, results of operations, or cash flows.
Dividends
We paid dividends on our common stock of $23.8 million ($0.77 per share) in fiscal 2026 and $20.6 million ($0.66 per share) in fiscal 2025. All decisions regarding the declaration and payment of dividends are at the discretion of the Board of Directors (the "Board") and are evaluated regularly in light of our financial condition, earnings, growth prospects, funding requirements, applicable law, and any other factors the Board deems relevant.
Share Repurchases
During fiscal 2026 and 2025, we repurchased approximately 0.9 million shares and 0.4 million shares of our outstanding common stock for $289.5 million and $117.1 million, respectively.
Total cash outflows for share repurchases during fiscal 2026 and 2025 were $287.2 million and $118.5 million, respectively. We expect to repurchase shares on an opportunistic basis subject to various factors including stock price, Company performance, market conditions, and other possible uses of cash.
Results of Operations
The following is a discussion of our results of operations in fiscal 2026 compared to fiscal 2025. A discussion of our fiscal 2025 results of operations compared to fiscal 2024 can be found within Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations within our fiscal 2025 Annual Report on Form 10-K filed with the Securities and Exchange Commission on October 27, 2025.
The following table sets forth information comparing the components of net income for the year ended August 31, 2026 with the year ended August 31, 2025 (in millions except per share data):
Year Ended August 31, Increase Percent
2026 2025 (Decrease) Change
Net sales $ 4,641.8 $ 4,345.6 $ 296.2 6.8 %
Cost of products sold 2,291.1 2,267.1 24.0 1.1 %
Gross profit 2,350.7 2,078.5 272.2 13.1 %
Percent of net sales 50.6 % 47.8 % 280 bps
Selling, distribution, and administrative expenses 1,613.3 1,484.9 128.4 8.6 %
Special charges 23.7 29.7 (6.0) NM
Operating profit 713.7 563.9 149.8 26.6 %
Percent of net sales 15.4 % 13.0 % 240 bps
Other expense:
Interest expense, net 25.6 22.0 3.6 NM
Miscellaneous expense, net 7.4 41.7 (34.3) NM
Total other expense 33.0 63.7 (30.7) NM
Income before income taxes 680.7 500.2 180.5 36.1 %
Percent of net sales 14.7 % 11.5 % 320 bps
Income tax expense 149.4 103.6 45.8 44.2 %
Effective tax rate 21.9 % 20.7 %
Net income $ 531.3 $ 396.6 $ 134.7 34.0 %
Diluted earnings per share $ 17.05 $ 12.53 $ 4.52 36.1 %
NM - not meaningful
Net Sales
Net sales of $4.64 billion for the year ended August 31, 2026 increased by $296.2 million, or 6.8%, compared with the prior year due primarily to higher sales in our AIS segment, partially offset by lower sales in our ABL segment. The increase in our AIS segment was driven by the acquisition of QSC, as well as higher net sales of our Distech products.
Gross Profit
Gross profit for the year ended August 31, 2026 increased $272.2 million, or 13.1%, to $2.35 billion compared with $2.08 billion for the prior year. This increase was due primarily to contributions from the QSC acquisition as well as the fall through of higher net sales of our Distech products. Additionally, in fiscal 2026 we received $51.3 million in refunds from U.S. Customs for tariffs previously paid under the International Emergency Economic Powers Act ("IEEPA"), and in fiscal 2025 we recorded $29.6 million in pre-tax nonrecurring acquisition date fair value adjustments to inventory related to the acquisition of QSC. These increases were partially offset by the fall through of lower net sales within the ABL segment.
Please refer to the Commitments and Contingencies footnote of the Notes to Consolidated Financial Statements within this Annual Report on Form 10-K for further details regarding tariff refunds.
Operating Profit
Operating profit for the year ended August 31, 2026 was $713.7 million (15.4% of net sales) compared with $563.9 million (13.0% of net sales) for the prior fiscal year, an increase of $149.8 million, or 26.6%. The increase in operating profit was due primarily to higher gross profit, partially offset by higher selling, distribution, and administrative ("SD&A") expenses.
SD&A expenses for the year ended August 31, 2026 were $1.61 billion compared with $1.48 billion in the prior year, an increase of $128.4 million, or 8.6%. The increase in SD&A expenses was due primarily to amounts related to the QSC acquisition, including higher employee-related costs and higher amortization from acquired intangibles, partially offset by acquisition-related professional fees that did not recur in fiscal 2026.
We recorded special charges totaling $23.7 million for the year ended August 31, 2026. These charges related primarily to actions taken to improve productivity and consisted of initiatives involving our product portfolio, supply chain, operating footprint, and labor cost reductions. Special charges for the year ended August 31, 2025 were $29.7 million, and consisted primarily of impairments of long-lived assets as well as employee severance costs related to productivity initiatives.
Please refer to the Special Charges footnote of the Notes to Consolidated Financial Statements within this Annual Report on Form 10-K for further details.
Interest Expense, net
We reported net interest expense of $25.6 million and $22.0 million for the years ended August 31, 2026 and 2025, respectively. Net interest expense increased year over year as lower interest income was partially offset by a decline in interest expense. These changes reflect both lower outstanding cash balances as well as lower outstanding borrowings during fiscal 2026.
Miscellaneous Expense, net
Miscellaneous expense, net consists of non-service components of net periodic pension cost, gains and losses associated with foreign currency-related transactions, and non-operating gains and losses.
We reported net miscellaneous expense of $7.4 million in fiscal 2026 compared with $41.7 million in fiscal 2025. This year-over-year change was due primarily to the recognition of $30.9 million for non-cash pension settlement charges in the fourth quarter of fiscal 2025 that did not recur in fiscal 2026.
The details of the fiscal 2025 pension settlement charges are described in the Pension and Defined Contribution Plans footnote of the Notes to Consolidated Financial Statements.
Income Taxes and Net Income
Our effective income tax rate was 21.9% and 20.7% for the years ended August 31, 2026 and 2025, respectively. This year-over-year increase was due primarily to a one-time $8.2 million tax benefit recorded in fiscal 2025 related to the expiration of the statute of limitations on tax reserves for uncertain tax positions. Further details regarding income taxes are included in the Income Taxes footnote of the Notes to Consolidated Financial Statements.
Net income for fiscal 2026 increased $134.7 million, or 34.0%, to $531.3 million from $396.6 million reported for the prior year. This increase was due primarily to higher operating profit and lower net miscellaneous expense, partially offset by higher income tax expense associated with the increase in profit and higher net interest expense.
Diluted earnings per share for fiscal 2026 was $17.05 compared with $12.53 for the prior-year period, an increase of $4.52, or 36.1%. This increase reflects higher net income as well as lower outstanding diluted shares.
Segment Results
The following table sets forth information comparing the operating results of our segments, ABL and AIS, for the year ended August 31, 2026 with the year ended August 31, 2025 (in millions):
Year Ended August 31,
2026 2025 Increase (Decrease) Percent Change
ABL:
Net sales $ 3,576.4 $ 3,612.2 $ (35.8) (1.0) %
Gross profit 1,672.6 1,654.5 18.1 1.1 %
Operating profit 623.5 590.6 32.9 5.6 %
Gross profit margin 46.8 % 45.8 % 100 bps
Operating profit margin 17.4 % 16.4 % 100 bps
AIS:
Net sales $ 1,106.6 $ 764.3 $ 342.3 44.8 %
Gross profit 678.1 424.0 254.1 59.9 %
Operating profit 186.5 76.1 110.4 145.1 %
Gross profit margin 61.3 % 55.5 % 580 bps
Operating profit margin 16.9 % 10.0 % 690 bps
ABL net sales for the year ended August 31, 2026 decreased 1.0% compared with the prior-year period. This decrease was due primarily to lower net sales within the direct sales network and the OEM and other channel. These decreases were partially offset by higher net sales within the independent sales network and the corporate accounts channel.
ABL gross profit was $1.67 billion (46.8% of ABL net sales) for the year ended August 31, 2026 compared with $1.65 billion (45.8% of ABL net sales) in the prior year, an increase of $18.1 million. The increase in gross profit was due primarily to lower net tariffs cost, including $38.2 million in IEEPA refunds, lower material costs, and lower quality costs. These increases were partially offset by the fall through of lower net sales as well as higher production costs.
ABL operating profit was $623.5 million (17.4% of ABL net sales) for the year ended August 31, 2026 compared with $590.6 million (16.4% of ABL net sales) in the prior year, an increase of $32.9 million. The increase in operating profit was due primarily to higher gross profit as well as lower special charges.
AIS net sales for the year ended August 31, 2026 increased $342.3 million or 44.8% compared with the prior-year period. The increase in sales is due primarily to the acquisition of QSC as well as higher net sales of Distech products.
AIS gross profit was $678.1 million (61.3% of AIS net sales) for the year ended August 31, 2026 compared with $424.0 million (55.5% of AIS net sales) in the prior-year period, an increase of $254.1 million. The increase in gross profit was due primarily to the acquisition of QSC, the fall through of higher Distech net sales, and $29.6 million in pre-tax nonrecurring acquisition date fair value adjustments to inventory related to the acquisition of QSC, which did not recur in fiscal 2026. Additionally, we recognized $13.1 million in IEEPA tariff refunds in fiscal 2026.
AIS operating profit was $186.5 million (16.9% of AIS net sales) for the year ended August 31, 2026 compared with $76.1 million (10.0% of AIS net sales) in the prior-year period, an increase of $110.4 million. This increase primarily reflects higher gross profit, partially offset by higher SD&A expenses, including increased employee costs and amortization due to the QSC acquisition.
Accounting Standards Adopted in Fiscal 2026 and Accounting Standards Yet to Be Adopted
See the New Accounting Pronouncements footnote of the Notes to Consolidated Financial Statements for information on recently adopted and upcoming standards.
Critical Accounting Estimates
Management's Discussion and Analysis of Financial Condition and Results of Operations addresses the financial condition and results of operations as reflected in our Consolidated Financial Statements, which have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). As discussed in the Description of Business and Basis of Presentation footnote of the Notes to Consolidated Financial Statements, the preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as reported amounts of revenue and expense during the reporting period. On an ongoing basis, we evaluate our estimates and judgments. We base our estimates and judgments on our substantial historical experience and/or other relevant factors, such as projections of future performance, the results of which form the basis for making judgments about the recognition and measurement of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. We discuss the development of accounting estimates with our Audit Committee of the Board of Directors on a recurring basis. See the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements for a summary of our accounting policies.
We believe the following accounting topics represent our critical accounting estimates.
Revenue Recognition
We recognize revenue when we transfer control of goods and services to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for goods and services. In the period of revenue recognition, we estimate and record provisions for rebates, sales incentives, product returns, and discounts to customers, in most instances, as reductions of revenue.
We also maintain one-time or on-going marketing and trade-promotion programs with certain customers that require us to estimate and accrue the expected costs of such programs. Generally, these provisions are recorded as reductions of revenue and are estimated based on customer agreements, historical trends, expected demand, or specific notification of pending returns. Although historical experience has generally been within expectations, there can be no assurance that future rebates, sales incentives, product returns, discounts, and marketing and trade-promotion programs will not exceed historical amounts. A significant increase in these activities could have a material adverse impact on our operating results in the future.
Please refer to the Revenue Recognition footnote of the Notes to Consolidated Financial Statements for additional information, including financial balances, regarding estimates related to revenue recognition.
Inventories
Inventories include materials, direct labor, inbound freight, customs, duties, tariffs, and related manufacturing overhead. Inventories are stated on a first-in, first-out basis at the lower of cost and net realizable value. We review inventory quantities on hand and record a provision for excess or obsolete inventory primarily based on estimated future demand and current market conditions. Although our historical experience related to demand and market conditions has been within expectations, a significant change in customer demand, market conditions, or technology could render certain inventory obsolete and thus could have a material adverse impact on our operating results in the period the change occurs.
Please refer to the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements for additional information.
Business Combinations
We account for business combinations using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed are recorded at their respective fair values at the date of acquisition. The determination of the acquisition date fair values of identifiable assets acquired and liabilities assumed requires estimates and a significant amount of management judgment and may involve third-party specialists. Generally, the assets requiring the most judgment are identified intangible assets, which are generally valued using an income, replacement cost, market comparable, or other approach.
For the QSC acquisition, we used an income approach to value significant acquired intangible assets. We used a relief-from royalty method for trade names, a distributor model for customer relationships, and a multi-period excess earnings method for developed technology and patents. Significant assumptions used in these models included
projected revenues, attrition rates, hypothetical royalty rates, hypothetical distributor margins, projected obsolescence factors, and/or relevant discount rates.
Although we believe our estimates of acquisition date fair values are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on the determination of the fair values of the intangible assets acquired.
Please refer to the Acquisitions and Divestitures footnote of the Notes to Consolidated Financial Statements for additional information.
Goodwill and Indefinite-Lived Intangible Assets
Goodwill is calculated as the residual value of an acquisition's purchase price less the value of the identifiable net assets and is thus dependent on the appropriate identification and valuation of the net assets obtained in an acquisition.
Indefinite-lived intangible assets consist of acquired trade names that are expected to generate cash flows indefinitely. Significant estimates and assumptions were used to both identify and determine the initial fair value of these acquired intangible assets, often with the assistance of third-party valuation specialists. These assumptions include, but are not limited to, estimated future net sales and profitability, royalty rates, and discount rates.
We review goodwill and indefinite-lived intangible assets for impairment on an annual basis as of the first date of our fiscal fourth quarter (June 1) or more frequently if events occur or circumstances change, such as a significant adverse change in our business climate, that would more likely than not indicate that the fair value of a reporting unit or an indefinite-lived asset is below its carrying value.
For our annual impairment tests, we may elect to perform a qualitative assessment of our goodwill and/or indefinite-lived intangibles as allowed under Accounting Standards Codification ("ASC") Topic 350, Intangibles-Goodwill and Other ("ASC 350") to determine whether it is more likely than not that an impairment occurred. If we determine that an asset is more likely than not impaired, we perform a quantitative impairment assessment for that asset. Alternatively, we may elect to forego the qualitative assessment. An impairment loss for goodwill is recognized in the event a reporting unit's carrying value exceeds its fair value and for an indefinite-lived intangible asset in the event the asset's carrying value exceeds its fair value.
An assessment of our goodwill and indefinite-lived intangible assets for impairment considers the use of significant judgments and estimates in accordance with U.S. GAAP including, but not limited to, economic, industry, and Company-specific qualitative factors, projected future net sales, operating results, and cash flows. Under a quantitative assessment, fair values for goodwill and indefinite-lived intangible assets are estimated using discounted future cash flows or another appropriate fair value method, and corroborated with market data, such as relevant market multiples. We currently believe that the estimates used in the evaluation of goodwill and indefinite-lived intangibles are reasonable. However, future differences between actual and expected net sales, operating results, and cash flows and/or changes in the discount rates, or theoretical royalty rates for indefinite-lived intangible assets, used could require us to record additional non-cash impairment charges to earnings for the write-down in the value of such assets. Such charges could have a material adverse effect on our results of operations and financial position but not our cash flows from operations.
Goodwill
As of June 1, 2026, the current fiscal year testing date, we performed a quantitative analysis to assess goodwill for impairment. Goodwill was tested for impairment at the reporting unit level using a combination of discounted future cash flows and relevant market multiples. Our discounted cash flow analyses required significant assumptions about discount rates, short and long-term growth rates, and future profitability. For the discounted cash flow analyses, we utilized discount rates ranging from approximately 10% to 11%. These rates were based on the Company's weighted average cost of capital, adjusted for reporting unit-specific risk considerations. Short-term growth rates were based on management's forecasted financial results, which consider key business drivers such as specific revenue growth initiatives, market share changes, growth in our addressable market, and general economic factors such as macroeconomic conditions, credit availability, and interest rates. We calculated the discounted cash flows attributable to our reporting units for a 10-year discrete period with a terminal value and compared this calculation to the discounted cash flows generated over a 40-year period to corroborate the reasonableness of assumptions used. The long-term growth rate used in determining terminal value was estimated at 2.5% and was primarily based on our understanding of projections for expected long-term growth in our addressable market, historical long-term performance, and the interest rate environment at the time of testing.
Based on the results of our analysis, the fair value of each reporting unit exceeded its carrying value; therefore, no impairment was recognized for our $1.5 billion of goodwill in fiscal 2026.
We corroborate the values determined from our discounted cash flow models using a relevant market multiple, generally published earnings and/or revenue multiples. We also reconcile the sum of the fair values for each reporting unit to our market capitalization at the testing date, including consideration of a control premium.
Any reasonably likely change in the assumptions used in these analyses, including revenue growth rates, discount rates, long-term growth rates, or relevant multiples would not cause the carrying value of any reporting unit to exceed its estimated fair value as determined under the goodwill impairment analysis. See the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements for additional information.
Indefinite-Lived Intangible Assets
As of June 1, 2026, the current fiscal year testing date, we held eight indefinite-lived intangible assets with an aggregate carrying value of $132.6 million. For fiscal 2026, we performed a qualitative analysis to assess our indefinite-lived intangible assets for impairment. Our qualitative analysis considered and assessed external factors such as macroeconomic, industry, cost, and market conditions as well as asset-specific factors, such as each trade name's actual and planned financial performance. Based on the results of our analysis, we determined there was not a more likely than not probability of impairment for all of the indefinite-lived intangible assets, and no quantitative test for these assets was required. We last performed a quantitative analysis in fiscal 2023 for the trade names and concluded that any reasonably likely change in the assumptions used in those analyses, including revenue growth rates, discount rates, long-term growth rates, or implied royalty rates would not result in an impairment.
See the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements for further details regarding the assumptions used and results of our annual impairment tests for the periods presented.
Forward-Looking Statements
This filing contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (the "Act"). Forward-looking statements include, but are not limited to, statements that describe or relate to the Company's plans, initiatives, projections, vision, goals, targets, commitments, expectations, objectives, prospects, strategies, or financial outlook, and the assumptions underlying or relating thereto. In some cases, we may use words such as "expect," "believe," "intend," "anticipate," "estimate," "forecast," "indicate," "project," "predict," "plan," "may," "will," "could," "should," "would," "potential," and words of similar meaning, as well as other words or expressions referencing future events, conditions, or circumstances, to identify forward-looking statements. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Act. Forward-looking statements are not guarantees of future performance. Our forward-looking statements are based on our current beliefs, expectations, and assumptions, which may not prove to be accurate, and are subject to known and unknown risks and uncertainties, assumptions, and other important factors, many of which are outside of our control and any of which could cause our actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties are discussed in our filings with the U.S. Securities and Exchange Commission, including this Annual Report on Form 10-K (including, but not limited to, Part I, Item 1A. Risk Factors), quarterly reports on Form 10-Q, and current reports on Form 8-K. Any forward-looking statement speaks only as of the date on which it is made. This Annual Report is not comprehensive, and for that reason, should be read in conjunction with such filings. You are cautioned not to place undue reliance on any forward-looking statements. Except as required by law, we undertake no obligation to publicly update or release any revisions to these forward-looking statements to reflect any events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, whether as a result of new information, future events, or otherwise.
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