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Goodwill and Intangible Assets | 12 Months Ended
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Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill During 2023, as a result of business reorganization events, the Company shifted from a single reporting unit structure to a multiple reporting unit structure. The Company reallocated goodwill to its newly formed reporting units and tested goodwill for impairment on the reporting unit level immediately before and immediately after each reorganization. The Company engaged a third-party expert to assist in the valuation analysis. The Company concluded that its goodwill was not impaired immediately before and immediately after each reorganization. To allocate goodwill to the newly formed reporting units in 2023, the Company estimated the fair value of its reporting units using a weighting of fair values derived from an income and a market approach. Estimating the fair value by these methods involves the use of various assumptions that the Company believes were reasonable under then current circumstances. Under the income approach, the Company determined the fair value of a reporting unit based on the present value of estimated future cash flows using the cash flow projections prepared by management. The market approach estimates the fair value based on market multiples of revenue or adjusted EBITDA, as applicable, derived from comparable publicly traded companies with similar operating and investment characteristics as the reporting unit. While these assumptions reflect management’s best estimates of future performance at that time, the estimates are inherently complex and uncertain and the Company’s actual results could differ materially from the estimates. The following table presents the goodwill allocated to the Company’s reportable segments as of December 31, 2024 and 2023, and the changes during the period:
|  | Twilio Communications |  | Twilio Segment |  | Total
|  | (In thousands)
Balance as of December 31, 2022 |  | $ | — |  |  | $ | — |  |  | $ | 5,284,153 |
Foreign currency adjustments |  |  |  |  |  | 26 |
Reallocation to segments in 2023(1) |  | $ | 4,978,094 |  |  | $ | 306,085 |  |  | — |
Foreign currency adjustments |  | 251 |  | — |  |  | 251 |
Goodwill divested(2) |  | (41,164) |  | — |  |  | (41,164)
Balance as of December 31, 2023 |  | $ | 4,937,181 |  |  | $ | 306,085 |  |  | $ | 5,243,266 |
____________________________________ |  |  |  |  |  |
(1) Represents reallocation of goodwill as a result of the change in reporting unit structure in 2023.
(2) Represents goodwill related to the divestitures of the ValueFirst business and IoT asset group in 2023, as described in Note 5.
There was no goodwill activity during the year ended December 31, 2024. As of December 31, 2024, the balance of the Company’s goodwill was $5.2 billion, of which $4.9 billion relates to the Communications reportable segment and $306.1 million relates to the Segment reportable segment. Intangible assets Intangible assets consist of the following:
|  | As of December 31, 2024
|  | Cost |  | Accumulated Amortization |  | Net
Amortizable intangible assets: |  | (In thousands)
Developed technology |  | $ | 388,341 |  |  | $ | (306,063) |  |  | $ | 82,278 |
Customer relationships |  | 348,314 |  |  | (215,523) |  |  | 132,791 |
Supplier relationships |  | 49,756 |  |  | (35,363) |  |  | 14,393 |
Trade names |  | 25,968 |  |  | (25,014) |  |  | 954 |
Patent |  | 3,968 |  |  | (1,096) |  |  | 2,872 |
Total amortizable intangible assets |  | 816,347 |  |  | (583,059) |  |  | 233,288 |
Non-amortizable intangible assets: |  |  |  |  |  |
Telecommunication licenses |  | 4,920 |  |  | — |  |  | 4,920 |
Trademarks and other |  | 295 |  |  | — |  |  | 295 |
Total |  | $ | 821,562 |  |  | $ | (583,059) |  |  | $ | 238,503 |
|  | As of December 31, 2023 |  |
|  | Cost |  | Accumulated Amortization |  | Net |  |
Amortizable intangible assets: |  | (In thousands) |  |
Developed technology |  | $ | 397,473 |  |  | $ | (259,635) |  |  | $ | 137,838 |  |  |
Customer relationships |  | 349,074 |  |  | (170,511) |  |  | 178,563 |  |  |
Supplier relationships |  | 49,756 |  |  | (26,316) |  |  | 23,440 |  |  |
Trade names |  | 25,968 |  |  | (23,600) |  |  | 2,368 |  |  |
Order backlog |  | 10,000 |  |  | (10,000) |  |  | — |  |  |
Patent |  | 3,968 |  |  | (902) |  |  | 3,066 |  |  |
Total amortizable intangible assets |  | 836,239 |  |  | (490,964) |  |  | 345,275 |  |  |
Non-amortizable intangible assets: |  |  |  |  |  |  |  |
Telecommunication licenses |  | 4,920 |  |  | — |  |  | 4,920 |  |  |
Trademarks and other |  | 295 |  |  | — |  |  | 295 |  |  |
Total |  | $ | 841,454 |  |  | $ | (490,964) |  |  | $ | 350,490 |  |  |
Amortization expense was $112.0 million, $192.5 million and $206.4 million for the years ended December 31, 2024, 2023 and 2022, respectively. There was no impairment related to intangible assets in the year ended December 31, 2024. In the year ended December 31, 2023, the Company recorded an impairment charge related to certain of its intangible assets, as described in Note 6. Total estimated future amortization expense is as follows:
|  | As of December 31, 2024
Year Ended December 31, |  | (In thousands)
2025 |  | $ | 107,862 |
2026 |  | 42,149 |
2027 |  | 25,330 |
2028 |  | 19,055 |
2029 |  | 14,970 |
Thereafter |  | 23,922 |
Total |  | $ | 233,288 |

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