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Goodwill and Acquired Intangible Assets

6 Months Ended

Jul. 04, 2021

N. GOODWILL AND ACQUIRED INTANGIBLE ASSETS

Goodwill

Teradyne performs its annual goodwill impairment test as required under the provisions of ASC 350-10,

“Intangibles—Goodwill and Other”

on December 31 of each fiscal year unless interim indicators of impairment exist. Goodwill is considered impaired when the net book value of a reporting unit exceeds its estimated fair value.

The changes in the carrying amount of goodwill by reportable segments for the six months ended July 4, 2021, were as follows:


	Industrial Automation			System Test			Wireless Test			Semiconductor Test			Total
	(in thousands)
Balance at December 31, 2020
Goodwill	$	433,752		$	158,699		$	361,819		$	262,155		$	1,216,425
Accumulated impairment losses		—			(148,183	)		(353,843	)		(260,540	)		(762,566	)

		433,752			10,516			7,976			1,615			453,859
Foreign currency translation adjustment		(12,191	)		—			—			(71	)		(12,262	)

Balance at July 4, 2021
Goodwill		421,561			158,699			361,819			262,084			1,204,163
Accumulated impairment losses		—			(148,183	)		(353,843	)		(260,540	)		(762,566	)

	$	421,561		$	10,516		$	7,976		$	1,544		$	441,597

Intangible Assets

Teradyne reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate.

Amortizable intangible assets consist of the following and are included in intangible assets, net on the balance sheet:


	Gross Carrying Amount		Accumulated Amortization			Foreign Currency Translation Adjustment			Net Carrying Amount
Balance at July 4, 2021		(in thousands)
Developed technology	$	272,547	$	(216,820	)	$	(2,779	)	$	52,948
Customer relationships		57,739		(47,780	)		191			10,150
Tradenames and trademarks		70,120		(45,187	)		90			25,023

Total intangible assets	$	400,406	$	(309,787	)	$	(2,498	)	$	88,121

Balance at December 31, 2020
Developed technology	$	272,547	$	(210,479	)	$	(1,610	)	$	60,458
Customer relationships		66,239		(54,524	)		305			12,020
Tradenames and trademarks		70,120		(42,344	)		685			28,461

Total intangible assets	$	408,906	$	(307,347	)	$	(620	)	$	100,939

Aggregate intangible asset amortization expense was $5.4 million and $10.9 million, respectively, for the three and six months ended July 4, 2021 and $8.9 million and $18.8 million, respectively, for the three and six months ended June 28, 2020.

Estimated intangible asset amortization expense for each of the five succeeding fiscal years is as follows:


Year	Amortization Expense
	(in thousands)
2021(remainder)	$	10,636
2022		20,570
2023		20,084
2024		19,776
2025		11,756
Thereafter		5,299