Goodwill and Other Intangible Assets

9 Months Ended

Jun. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS

The following table summarizes changes in the carrying amount of goodwill in each of the Company’s reportable segments (in millions):



	Building Solutions North America		Building Solutions EMEA/LA		Building Solutions Asia Pacific		Global Products		Total
Goodwill	$	10,040	$	1,932	$	1,179	$	5,750	18,901
Accumulated impairment loss	(659)		(47)		—		(259)		(965)
Balance at September 30, 2023	9,381		1,885		1,179		5,491		17,936


Impairments	—		(230)		—		—		(230)
Foreign currency translation and other (1)	6		31		(2)		(65)		(30)
Balance at June 30, 2024	$	9,387	$	1,686	$	1,177	$	5,426	$	17,676

(1) Includes measurement period adjustments and the allocation of $21 million of goodwill from Global Products to the ADTi disposal group classified as held for sale. Refer to Note 4, "Assets and Liabilities Held for Sale" of the notes to the consolidated financial statements for further information.

The Company tests goodwill for impairment annually as of July 31 or more frequently if events or changes in circumstances indicate the asset might be impaired.

During the second quarter of fiscal 2024, the Company determined a triggering event had occurred for one of its reporting units due to year-to-date results and projections for the remainder of fiscal 2024 being lower than the forecast used in the previous annual goodwill impairment test, and a quantitative test of goodwill for possible impairment was necessary. As a result of the goodwill impairment test, the Company recorded a non-cash impairment charge of $230 million within restructuring and impairment costs in the consolidated statements of income, which was determined by comparing the carrying amount of the reporting unit to its fair value. The Company used a discounted cash flow model to estimate the fair value of the reporting unit. The primary assumptions used in the model were management's internal projections of future

cash flows, the weighted-average cost of capital and the long-term growth rate, which are classified as Level 3 inputs within the fair value hierarchy as defined in ASC 820, "Fair Value Measurement." The reporting unit whose goodwill was impaired was previously disclosed as being at risk of impairment in the Company’s Annual Report on Form 10-K for the year-ended September 30, 2023. It is possible that future changes in circumstances, including an increase in the discount rate or a decrease in the revenue growth rates, could result in an additional non-cash impairment charge of the remaining $212 million of goodwill for this reporting unit.

There were no other triggering events requiring an impairment assessment be conducted in the nine months ended June 30, 2024.

Other intangible assets, primarily from business acquisitions, consisted of (in millions):


	June 30, 2024						September 30, 2023
	Gross Carrying Amount		Accumulated Amortization		Net		Gross Carrying Amount		Accumulated Amortization		Net
Definite-lived intangible assets
Technology	$	1,590	$	(919)	$	671	$	1,575	$	(806)	$	769
Customer relationships	2,790		(1,562)		1,228		3,047		(1,496)		1,551
Miscellaneous	968		(509)		459		889		(435)		454
	5,348		(2,990)		2,358		5,511		(2,737)		2,774
Indefinite-lived intangible assets
Trademarks/trade names	1,957		—		1,957		2,114		—		2,114


Total intangible assets	$	7,305	$	(2,990)	$	4,315	$	7,625	$	(2,737)	$	4,888

Amortization of other intangible assets for the three months ended June 30, 2024 and 2023 was $119 million and $111 million, respectively. Amortization of other intangible assets for the nine months ended June 30, 2024 and 2023 was $366 million and $319 million, respectively.