In the second quarter of 2026, we concluded that the sustained decline in our share price and market capitalization, along with significant downside volatility during the second quarter, constituted a triggering event requiring an interim goodwill impairment assessment for all of our reporting units. We utilized the discounted cash flow method under the income approach to estimate the fair value of our reporting units.

As a result of the interim impairment test, we recognized non-cash goodwill impairment losses of $1.7 billion in SG&A in the second quarter of 2026, of which $788 million related to our Western Europe (“WE”) reporting unit within our International Developed Markets segment, as well as $656 million related to our Hydration, Desserts and Meals (“HDM”) reporting unit, $217 million related to our Elevation reporting unit, and $55 million related to our Canada reporting unit within our North America segment.

The goodwill impairments were driven by a combination of the market’s perceived risk of our ability to achieve future cash flow projections and the inclusion of updated cash flow expectations, which reflect the previously announced investments in marketing, sales, and R&D, as well as the allocation of those investments to reporting units and brands. These investments are expected to strengthen the competitive positioning of our brands; however, we believe the market remains uncertain as to the Company’s ability to achieve the plan.

Additionally, as of the last day of the second quarter of 2026, we separated the Elevation reporting unit into two reporting units, Taste Elevation (“TE”) and Away From Home (“AFH”) in an effort to drive focus and clarity in our organizational structure and reporting processes. As a result of this reorganization, we reassigned assets and liabilities and reallocated the existing goodwill, using the fair value approach, from the former Elevation reporting unit into the new reporting units, TE and AFH.

We performed our pre- and post-reorganization impairment tests as of June 27, 2026, which was the last day of the second quarter of 2026. We utilized the discounted cash flow method under the income approach to estimate the fair value as of June 27, 2026. As a result of our post-reorganization impairment test, we recognized non-cash goodwill impairment losses of $725 million in SG&A related to the AFH reporting unit within our North America segment. The impairment charge was largely due to the AFH business having a higher asset base supporting a lower margin business compared to the Taste Elevation business.

After the impairment tests performed in the second quarter of 2026 (the “Q2 2026 Impairment Tests”), the goodwill carrying amount is $10.1 billion in our TE reporting unit, $7.3 billion in our HDM reporting unit, $650 million in our WE reporting unit, $80 million in our AFH reporting unit, and no goodwill remaining in our Canada reporting unit.

During 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 2025 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, 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 reporting unit within our North America segment, as well as $819 million related to our 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.

Our reporting units that were impaired in the Q2 2026 Impairment Tests were written down to their respective fair values resulting in zero excess fair value over carrying amount as of the applicable impairment test dates. Following the Q2 2026 Impairment Tests, our TE, AFH, HDM, and WE reporting units had less than 5% fair value over carrying amount with an aggregate goodwill carrying amount of $18.2 billion. Our Meat, Cheese, Coffee, and Snacks (“MCCS”) and Asia reporting units have between 5% to 10% fair value over carrying amount and an aggregate carrying amount of $1.5 billion.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual reporting units requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions, and to consider the market multiples of certain peer and guideline companies. These assumptions and estimates include estimated future annual cash flows (including net sales, cost of products sold, SG&A, depreciation and amortization, working capital, and capital expenditures), income tax rates, discount rates, long-term growth rates, royalty rates, and other market factors. As part of our Q2 2026 Impairment Tests as of June 27, 2026, we used discount rates ranging from 6.8% to 13.5% and long-term growth rates ranging from 0.0% to 4.0%. If current expectations of future growth rates and margins are not met, if market factors outside of our control change (such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation), or if management’s expectations or plans otherwise change (including updates to our long-term operating plans), then one or more of our reporting units might become impaired in the future. Additionally, any decisions to divest certain non-strategic assets could lead to future goodwill impairments.

During the second quarter of 2026, certain organizational changes were announced that are expected to impact our future internal reporting and reportable segments. We plan to combine our WEEM and AEM operating segments to form the Emerging Markets operating segment in order to increase efficiencies and drive sustainable growth across our global business. In conjunction with the creation of the Emerging Markets operating segment, we plan to move remaining European countries within the WEEM operating segment into the EPDM operating segment.

As a result of these changes, we expect to have three reportable segments: North America, Europe and Pacific Developed Markets, and Emerging Markets. We expect that the change to our reportable segments will be effective in the third quarter of 2026. We will continue to evaluate for possible goodwill impairment triggering events that this reorganization may cause as a result of the potential changes to our existing reporting unit composition.

In the third quarter of 2026, certain organizational changes were announced within our new Emerging Markets operating segment that could result in a change to the reporting unit composition. We expect that this change will be effective in the third quarter of 2026. A change in the reporting unit composition could require us to reallocate goodwill and perform transition tests. As these transition tests could incorporate changes to our reporting unit composition, as well as updates to our estimated future cash flows, among other assumptions, there is a risk that future impairment charges may occur.

In the second quarter of 2026, we concluded that the sustained decline in our share price and market capitalization, along with the significant downside volatility in our share price during the second quarter, constituted a triggering event requiring an interim indefinite-lived intangible asset impairment assessment of our brands. As part of the interim impairment test, we utilized the multi-period excess earnings and relief from royalty method under the income approach to estimate the fair value of our indefinite-lived intangible assets.

As a result, we recognized non-cash intangible asset impairment losses of $4.9 billion in SG&A in the second quarter of 2026, of which $3.4 billion related to Kraft, $660 million related to Oscar Mayer, $445 million related to Lunchables, and $379 million related to five other brands in our North America segment. We recorded a $48 million impairment to one brand in Emerging Markets and $10 million to one brand in our International Developed Markets segment.

The impairments of these brands were driven by a combination of the market’s perceived risk of our ability to achieve future revenue and margin growth projections and the inclusion of updated cash flow expectations, which reflect the previously announced investments in marketing, sales, and R&D, as well as the allocation of those investments to reporting units and brands. These investments are expected to strengthen the competitive positioning of our brands; however, we believe the market remains uncertain as to the Company’s ability to achieve the plan. After these impairments, the aggregate carrying amount of these brands was $9.3 billion.

During 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 indefinite-lived intangible asset impairment assessment for our brands. As part of the Q2 2025 Impairment Test, we utilized the multi-period excess earnings and relief from royalty method under the income approach to estimate the fair value of our indefinite-lived intangible assets.

As a result, we recognized non-cash intangible asset impairment losses of $2.6 billion in SG&A in the second quarter of 2025, of which $1.9 billion related to Kraft, $382 million related to Velveeta, $175 million related to Lunchables, $100 million related to Maxwell House and $42 million related to two other brands in our North America segment, consistent with ownership of the trademarks. The impairments of these brands were primarily due to the market’s perceived risk of our ability to achieve our future year revenue growth and margin growth assumptions, due in part to uncertainty in the macroeconomic environment in which we operate.

As of the impairment test, brands with 20% or less fair value over carrying amount had an aggregate carrying amount after impairment of $12.8 billion, brands with 20% to 50% fair value over carrying amount had an aggregate carrying amount of $6.9 billion, and brands that had over 50% fair value over carrying amount had an aggregate carrying amount of $9.5 billion.

Our brands that had 20% or less excess fair value over carrying amount as of the impairment test have a heightened risk of future impairments if any assumptions, estimates, or market factors change in the future. Although our remaining brands had more than 20% excess fair value over carrying amount, these amounts are also susceptible to impairments if any assumptions, estimates, or market factors significantly change in the future.

Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions, estimates, and market factors. Estimating the fair value of individual brands requires us to make assumptions and estimates regarding our future plans, as well as industry, economic, and regulatory conditions, and to consider the market multiples of certain peer and guideline companies. These assumptions and estimates include estimated future annual cash flows, income tax considerations, discount rates, long-term growth rates, royalty rates, contributory asset charges, and other market factors. As part of the impairment test as of June 27, 2026, we used discount rates ranging from 8.1% to 10.3%, long-term growth rates ranging from 0.0% to 4.0%, and royalty rates ranging from 3.0% to 20.0%. If current expectations of future growth rates, royalty rates, and margins are not met, if market factors outside of our control change (such as discount rates, market capitalization, income tax rates, foreign currency exchange rates, or inflation), or if management’s expectations or plans otherwise change (including updates to our long-term operating plans), then one or more of our brands might become impaired in the future. Additionally, any decisions to divest certain non-strategic assets could lead to future intangible asset impairments.


	June 27, 2026						December 27, 2025
	Gross		Accumulated Amortization		Net		Gross		Accumulated Amortization		Net(a)
Trademarks	$	2,368	$	(1,074)	$	1,294	$	2,369	$	(1,016)	$	1,353
Customer-related assets	3,659		(1,740)		1,919		3,704		(1,700)		2,004
Other	11		(5)		6		11		(4)		7
	$	6,038	$	(2,819)	$	3,219	$	6,084	$	(2,720)	$	3,364

Amortization expense for definite-lived intangible assets was $62 million for the three months and $123 million for the six months ended June 27, 2026 and $62 million for the three months and $123 million for the six months ended June 28, 2025. Aside from amortization expense and the impacts of foreign currency, the change in definite-lived intangible assets from December 27, 2025 to June 27, 2026 is primarily related to non-cash intangible asset impairment losses of $22 million related to four definite-lived intangible assets within our International Developed Markets and North America segments.