Goodwill and Acquired Intangible Assets

6 Months Ended

Jan. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]


4. Goodwill and Acquired Intangible Assets


Goodwill

Changes in the carrying value of goodwill by reportable segment during the six months ended January 31, 2021 were as shown in the following table. Our reportable segments are described in Note 12, “Segment Information.”


(In millions)	Balance July 31, 2020		Goodwill Acquired		Foreign Currency Translation		Balance January 31, 2021
Small Business & Self-Employed	$	1,518	$	43	$	1	$	1,562
Consumer	42		—		—		42
ProConnect	94		—		1		95
Credit Karma	—		3,899		—		3,899
Totals	$	1,654	$	3,942	$	2	$	5,598

Goodwill is net of accumulated impairment losses of $114 million, which were recorded prior to July 31, 2020 and are included in our Consumer segment. The fiscal 2021 increase in goodwill in our new Credit Karma segment was primarily due to the acquisition of Credit Karma. See Note 5, "Business Combinations."


Acquired Intangible Assets

The following table shows the cost, accumulated amortization and weighted average life in years for our acquired intangible assets at the dates indicated. The increases in intangible assets during the six months ended January 31, 2021 were primarily due to the acquisition of Credit Karma. See Note 5, "Business Combinations." The weighted average lives are calculated for assets that are not fully amortized.


(Dollars in millions)	Customer Lists / User Relationships		Purchased Technology		Trade Names and Logos		Covenants Not to Compete or Sue		Total

At January 31, 2021:
Cost	$	3,038	$	681	$	400	$	42	$	4,161
Accumulated amortization	(282)		(426)		(29)		(40)		(777)
Acquired intangible assets, net	$	2,756	$	255	$	371	$	2	$	3,384
Weighted average life in years	15		5		15		3		14

At July 31, 2020:
Cost	$	256	$	421	$	25	$	42	$	744
Accumulated amortization	(248)		(404)		(25)		(39)		(716)
Acquired intangible assets, net	$	8	$	17	$	—	$	3	$	28
Weighted average life in years	5		3		0		3		4

The following table shows the expected future amortization expense for our acquired intangible assets at January 31, 2021. Amortization of purchased technology is charged to cost of service and other revenue and to amortization of acquired technology in our consolidated statements of operations. Amortization of other acquired intangible assets such as customer lists is charged to amortization of other acquired intangible assets in our consolidated statements of operations. If impairment events occur, they could accelerate the timing of acquired intangible asset charges.


(In millions)	Expected Future Amortization Expense
Twelve months ending July 31,
2021 (excluding the six months ended January 31, 2021)	$	136
2022	271
2023	263
2024	248
2025	247
Thereafter	2,219
Total expected future amortization expense	$	3,384