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Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2024

4.Goodwill and Intangible Assets

Goodwill

As of September 30, 2024, the Company performed its annual goodwill impairment analysis on one of its reporting units, the Agility segment. It involved a quantitative goodwill impairment test and estimated the fair value based on a combination of the income approach (estimates of future discounted cash flows) and the market approach (market multiples for similar companies) using unobservable inputs (Level 3). The income approach uses a discounted cash flow (“DCF”) method that utilizes the present value of cash flows to estimate the segment’s fair value. The future cash flows of the segment were projected based on the Company’s estimates of future revenues, operating income, and other factors such as working capital and capital expenditures. As part of the DCF analysis, the Company projected revenue and operating profits and assumed long-term revenue growth rates in the terminal year. The market approach utilizes multiples of revenues and earnings before interest expense, taxes, depreciation, and amortization (“EBITDA”) to estimate the segment’s fair value. The market multiples used for the segment were based on a group of comparable companies’ market multiples applied to the Company’s revenue. The Company concluded that there is no impairment of goodwill.

The change in the carrying amount of goodwill for the nine months ended September 30, 2024 was as follows (in thousands):


Balance - January 1, 2024	$	2,075
Foreign currency translation adjustment		9
Balance - September 30, 2024	$	2,084

The fair value measurement of goodwill for the Agility segment was classified within Level 3 of the fair value hierarchy because the Company used the income approach, which utilizes significant inputs that are unobservable in the market and the market multiple approach using comparable entities to further validate the carrying values. The Company believes it made reasonable estimates and assumptions to calculate the fair value of the reporting unit as of the impairment test measurement date. The carrying value of Goodwill was $2.1 million for each of the periods ended September 30, 2024 and December 31, 2023.

Intangibles

Information regarding the Company acquired intangible assets and capitalized developed software was as follows (in thousands):


	September 30, 2024
					Foreign
	Gross				Currency		Net
	Carrying		Accumulated		Translation		Carrying
	Value		Amortization		Adjustment		Value
Acquired Intangible Assets
Developed technology	$	3,060	$	(2,886)	$	1	$	175
Customer relationships		2,144		(1,813)		(11)		320
Trademarks and tradenames		862		(819)		1		44
Patents		44		(44)		-		-
Media Contact Database		3,546		(2,925)		14		635
Total Acquired Intangible Assets	$	9,656	$	(8,487)	$	5	$	1,174

Capitalized Developed Software
Capitalized Developed Software	$	19,299	$	(9,508)	$	(128)	$	9,663
Capitalized Developed Software - in Progress		3,044		-		(1)		3,043
Total Capitalized Developed Software	$	22,343	$	(9,508)	$	(129)	$	12,706

Total	$	31,999	$	(17,995)	$	(124)	$	13,880


	December 31, 2023
					Foreign
	Gross				Currency		Net
	Carrying		Accumulated		Translation		Carrying
	Value		Amortization		Adjustment		Value
Acquired Intangible Assets
Developed technology	$	2,999	$	(2,640)	$	7	$	366
Customer relationships		2,096		(1,645)		10		461
Trademarks and tradenames		852		(774)		2		80
Patents		43		(40)		-		3
Media Contact Database		3,492		(2,621)		16		887
Total Acquired Intangible Assets	$	9,482	$	(7,720)	$	35	$	1,797

Capitalized Developed Software
Capitalized Developed Software	$	15,216	$	(6,862)	$	138	$	8,492
Capitalized Developed Software - in Progress		3,480		-		(11)		3,469
Total Capitalized Developed Software	$	18,696	$	(6,862)	$	127	$	11,961

Total	$	28,178	$	(14,582)	$	162	$	13,758

Amortization expense relating to acquired intangible assets was $0.2 million for each of the three-month periods ended September 30, 2024 and 2023. Amortization expense relating to acquired intangible assets was $0.6 million and $0.7 million for the nine months ended September 30, 2024 and 2023, respectively.

Amortization expense relating to capitalized developed software was $1.0 million and $0.7 million for the three months ended September 30, 2024 and 2023, respectively. Amortization expense relating to capitalized developed software was $2.5 million and $1.9 million for the nine months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, estimated future amortization expense for intangible assets was as follows (in thousands):


Year	Amortization
2024	$	2,202
2025		5,041
2026		3,757
2027		1,336
2028		732
Thereafter		812
	$	13,880