Goodwill And Intangible Assets

12 Months Ended

Sep. 28, 2025

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

The changes in the carrying amount of goodwill during fiscal 2025 and 2024 were as follows (in thousands):


	Jack in the Box		Del Taco		Total
Goodwill	$	136,027	$	193,959	$	329,986
Accumulated impairment losses	—		—		—
Balance at October 1, 2023	136,027		193,959		329,986

Impairment of goodwill	—		(162,624)		(162,624)
Sale of Del Taco company-operated restaurants to franchisees	—		(5,544)		(5,544)

Reclassified to assets held for sale	(200)		(409)		(609)

Goodwill	135,827		188,006		323,833
Accumulated impairment losses	—		(162,624)		(162,624)
Balance at September 29, 2024	135,827		25,382		161,209

Acquisition of Del Taco company-operated restaurants	—		6,326		6,326
Impairment of goodwill	—		(31,656)		(31,656)


Reclassified from (to) assets held for sale	199		(52)		147

Goodwill	136,026		194,280		330,306
Accumulated impairment losses	—		(194,280)		(194,280)
Balance at September 28, 2025	$	136,026	$	—	$	136,026

During the third quarter of the prior year, the Company identified triggering events that indicated the goodwill allocated to the Del Taco reporting unit might be impaired. The triggering events related to i) a recent negative trend in Del Taco same store sales, ii) lower margins due in part to lower sales and higher wages required in California effective April 1, 2024 under AB 1228 and iii) unfavorable changes in the economic environment specifically impacting our industry, including inflation and interest rates. As a result, the Company performed a quantitative test over the Del Taco reporting unit, noting that the fair value of the reporting unit was less than the carrying value, which resulted in an impairment of goodwill of $162.6 million.

In performing a quantitative test for impairment of goodwill for Del Taco, we use the income approach method of valuation that includes the discounted cash flow method and the market approach that includes the guideline public company method to determine the fair value of the reporting unit. Significant assumptions made by management to estimate fair value under the discounted cash flow method include future cash flow assumptions. The Company also performed a quantitative analysis over its indefinite-lived intangible trademark asset, as well as over its definite-lived intangible assets to determine whether any impairment would need to be recognized, noting none at that time.

During the second quarter of 2025, the Company identified additional triggering events that indicated the goodwill allocated to the Del Taco reporting unit might be further impaired, including i) continued negative trend in Del Taco same store sales, ii) unfavorable changes in the economic environment specifically impacting our industry, including inflation and interest rates, iii) the potential for a divestment of Del Taco, and iv) a sustained lower share price. As a result, the Company performed a quantitative test over the Del Taco reporting unit, noting that the fair value of the reporting unit was less than the carrying value, which resulted in an impairment of goodwill of $25.3 million for the second quarter of 2025. The valuation used a blended approach with a discounted cash flow analysis in conjunction with a market approach. Assumptions and estimates used in determining fair value include revenue growth rates, operating costs, new store openings, capital expenditures, a discount rate that approximates the Company’s weighted average cost of capital and a selection of comparable companies. The Company determined that there was no such triggering event for the Jack in the Box reporting unit.

As a result of the franchisee acquisition during the third quarter of 2025, the Company recognized additional goodwill of $6.3 million. This additional goodwill was fully impaired based on the results of the quantitative impairment analysis performed in the second quarter of 2025. The goodwill for the Del Taco reporting unit is fully impaired as of the end of 2025.

In connection with the goodwill analysis during the second quarter of 2025, and as a result of the triggering events noted above, the Company also performed a quantitative analysis over its indefinite-lived intangible trademark asset and as a result, the Company recorded impairment of $177.9 million on the Del Taco trademark asset as noted below. The Company uses a ‘relief from royalty’ method to value its trademark asset, which includes inputs such as systemwide sales, brand royalty rate, brand-related expenses, tax rate, discount rate and a long-term growth rate. During the third and fourth quarters of 2025, the Company performed a qualitative analysis over its indefinite-lived intangible trademark asset, noting no further impairment was deemed necessary.

The changes in the carrying amount of the Del Taco indefinite-lived trademark during the year-to-date period ended September 28, 2025 was as follows (in thousands):


Balance at September 29, 2024	$	283,500
Impairment of trademark	(177,900)
Balance at September 28, 2025	$	105,600

The net carrying amounts of intangible assets are as follows (in thousands):


	September 28, 2025						September 29, 2024
	Gross Amount		Accumulated Amortization		Net Amount		Gross Amount		Accumulated Amortization		Net Amount
Definite-lived intangible assets:
Sublease assets	$	2,671	$	(861)	$	1,810	$	2,671	$	(620)	$	2,051
Franchise contracts	9,700		(1,928)		7,772		9,700		(1,389)		8,311
Reacquired franchise rights	629		(327)		302		464		(311)		153
	$	13,000	$	(3,116)	$	9,884	$	12,835	$	(2,320)	$	10,515

The following table summarizes, as of September 28, 2025, the estimated amortization expense for each of the next five fiscal years (in thousands):


2026	$	798
2027	812
2028	761
2029	699
2030 and thereafter	6,814
Total	$	9,884

- Definition

The entire disclosure for goodwill.

+ References + Details

JACK IN THE BOX INC 10-K