XML 24 R13.htm IDEA: XBRL DOCUMENT
v3.25.3

GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended
--- | ---
Sep. 30, 2025
Goodwill and Intangible Assets Disclosure [Abstract] |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Due to the application of pushdown accounting, the Company’s balance sheet includes goodwill and intangible assets recognized by Illumina in connection with Illumina’s acquisition of the Company. Goodwill Impairment Goodwill represents the excess of purchase price Illumina paid over the fair value of the net identifiable assets acquired upon the acquisition of the Company. During the three months ended June 30, 2024, prior to the Spin-Off, the approval of the Spin-Off by Illumina’s board of directors represented a potential indicator of impairment, which also aligned with the timing of Illumina’s annual goodwill impairment test date for 2024. The assessment was performed using a market approach to determine the fair value of goodwill which utilized the valuation ranges prepared by the divestment financial advisors engaged by Illumina in connection with the Spin-Off. The valuation ranges were determined using revenue multiples from public company peers for comparable companies. The implied discount rate for the goodwill impairment assessment was 51.5%. These estimates and assumptions represent a Level 3 measurement because they include unobservable inputs that are supported by little or no market activity and reflect Company-determined and judgmental factors for these assumptions in measuring fair value. The assumptions in the assessment of an impairment analysis are inherently subjective due to uncertainty and any slight changes in these rates and assumptions could have a significant impact on the concluded value of goodwill. The Company recognized a goodwill impairment of $888.9 million as a result of the impairment assessment, primarily due to changes to the forecast of GRAIL’s value and the method for valuing GRAIL. Intangible Assets Intangible assets identified in the Acquisition include developed technology, trade names and IPR&D and were measured at fair value as of the closing date of Illumina’s acquisition of the Company (“Closing Date”). The following roll-forward indicates the fair values assigned to finite-lived intangible assets from the Acquisition and the resulting amortization:
| As of
| September 30, 2025 |  | December 31, 2024
(in thousands) | Gross Carrying Amount |  | Accumulated Amortization |  | Net Intangible Assets |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Intangible Assets
Developed Technologies | $ | 2,410,000 |  |  | $ | (546,713) |  |  | $ | 1,863,287 |  |  | $ | 2,410,000 |  |  | $ | (446,297) |  |  | $ | 1,963,703 |
Trade Names | 40,000 |  |  | (18,147) |  |  | 21,853 |  |  | 40,000 |  |  | (14,813) |  |  | 25,187 |
Total Finite-Lived Intangible Assets | $ | 2,450,000 |  |  | $ | (564,860) |  |  | $ | 1,885,140 |  |  | $ | 2,450,000 |  |  | $ | (461,110) |  |  | $ | 1,988,890 |
The following roll-forward indicates the carrying value of the indefinite-lived intangible asset from the Acquisition and the impairment expenses recorded:
(in thousands) | IPR&D
Balance as of January 1, 2024 | $ | 560,000 |
Impairment | (532,000) |
Balance as of December 31, 2024 | 28,000 |
Impairment | (28,000) |
Balance as of September 30, 2025 | $ | — |
In conjunction with Illumina’s Q2 2024 goodwill impairment assessment, the IPR&D intangible asset of the GRAIL reporting unit was evaluated for potential impairment by Illumina prior to the Spin-Off. The evaluation for a potential impairment of the IPR&D intangible asset was performed by comparing its carrying value to the assessed estimated fair value, which was determined by the income approach, using a discounted cash flow model. Estimates and assumptions used in the income approach included projected cash flows and a discount rate. The discount rate selected at the time of the IPR&D intangible impairment assessment prior to the Spin-Off was 46.5%. Based on the impairment test performed, Illumina assessed and determined that the carrying value of GRAIL’s IPR&D intangible asset exceeded its estimated fair value. As a result of push down accounting, the Company recognized an impairment of $420.0 million primarily due to changes to revenue projections and the discount rate utilized. In Q2 2024, subsequent to the Spin-Off, the Company performed a portfolio review and determined to decrease investment in the development of the IPR&D asset, which impacted the amount and timing of expected future cash flows attributable to IPR&D. This determination was driven by the impact of the Company’s post-Spin-Off capital structure, constitution of the Company’s Board at the time of the Spin-Off as the key decision maker for the determination, and increased ability to revisit the Company’s business strategy and portfolio as a standalone public company without regulatory oversight. This represented a potential impairment indicator. An impairment assessment was performed using a discounted cash flow model utilizing the updated projected cash flows and discount rate. The discount rate selected was 20%. Based on the impairment test performed, the Company assessed and determined that the carrying value of the IPR&D intangible asset exceeded its estimated fair value. As a result, the Company recognized an additional impairment of $112.0 million, primarily due to a decrease in projected cash flows. In Q2 2025, the Company identified a change in market conditions in relation to its IPR&D asset which is in development. The change is expected to impact the amount of future cash flows attributable to the technology underlying the IPR&D asset. This represented a potential impairment indicator. An impairment assessment was performed using a discounted cash flow model utilizing the updated projected cash flows and discount rate. The discount rate selected was 21%. Based on the impairment test performed, the Company assessed and determined that the carrying value of the IPR&D intangible asset exceeded its estimated fair value. As a result, the Company recognized an impairment of $28.0 million, resulting in write off of the entire carrying value of the IPR&D asset. The estimates and assumptions updated in each of these evaluations represent a Level 3 measurement because they include unobservable inputs that are supported by little or no market activity and reflect Company- determined and judgmental factors for these assumptions in measuring a fair value. The assumptions in the assessment of an impairment analysis are inherently subjective due to uncertainty and any slight changes in these rates and assumptions could have a significant impact on the concluded value of the IPR&D intangible asset. Amortization expense related to finite-lived intangible assets was $34.6 million for each of the three month periods ended September 30, 2025 and 2024 and $103.8 million for each of the nine month periods ended September 30, 2025 and 2024. The estimated future annual amortization of finite-lived intangible assets is shown in the following table. Actual amortization expense to be reported in future periods could differ from these estimates as a result of acquisitions, divestitures, and asset impairments, among other factors.
(in thousands) | Estimated Annual Amortization
Remainder of 2025 | $ | 34,583 |
2026 | 138,333 |
2027 | 138,333 |
2028 | 138,333 |
2029 | 138,333 |
2030 and thereafter | 1,297,225 |
Total | $ | 1,885,140

X
- References No definition available. + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration