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Intangible Assets, net | 12 Months Ended
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Dec. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract] |
Intangible Assets, net | 9. Intangible Assets, net Intangible assets, net, consist of the following:
| December 30, 2023 |  | As Adjusted, December 31, 2022(1)
(in millions) | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount
Intangible assets subject to amortization: |  |  |  |  |  |  |  |  |  |  |
Customer relationships | $ | 209.2 |  |  | $ | (31.5) |  |  | $ | 177.7 |  |  | $ | 220.9 |  |  | $ | (19.3) |  |  | $ | 201.6 |
Acquired technologies | 174.7 |  |  | (45.3) |  |  | 129.4 |  |  | 185.3 |  |  | (25.2) |  |  | 160.1 |
Capitalized software development costs | 53.9 |  |  | (15.2) |  |  | 38.7 |  |  | 25.0 |  |  | (2.9) |  |  | 22.1 |
Licenses | 39.7 |  |  | (7.4) |  |  | 32.3 |  |  | 39.0 |  |  | (4.4) |  |  | 34.6 |
Patents | 39.2 |  |  | (15.2) |  |  | 24.0 |  |  | 35.2 |  |  | (13.9) |  |  | 21.3 |
Trademarks | 20.1 |  |  | (7.4) |  |  | 12.7 |  |  | 19.8 |  |  | (5.8) |  |  | 14.0 |
Licenses-related party | 7.5 |  |  | (6.7) |  |  | 0.8 |  |  | 7.5 |  |  | (6.3) |  |  | 1.2 |
Non-compete agreements | 6.3 |  |  | (2.6) |  |  | 3.7 |  |  | 6.3 |  |  | (1.1) |  |  | 5.2 |
Other | 1.7 |  |  | (1.1) |  |  | 0.6 |  |  | 1.6 |  |  | (1.1) |  |  | 0.5 |
Total intangible assets subject to amortization, net | $ | 552.3 |  |  | $ | (132.4) |  |  | $ | 419.9 |  |  | $ | 540.6 |  |  | $ | (80.0) |  |  | $ | 460.6 |
Intangible assets not subject to amortization: |  |  |  |  |  |  |  |  |  |  |
Trademarks |  |  |  |  | $ | 242.4 |  |  |  |  |  |  | $ | 262.0 |
Impairment charge |  |  |  |  | (10.0) |  |  |  |  |  |  | — |
Total trademarks |  |  |  |  | 232.4 |  |  |  |  |  |  | 262.0 |
Intangible assets, net |  |  |  |  | $ | 652.3 |  |  |  |  |  |  | $ | 722.6 |
The following intangible assets reclassification adjustments were made as of September 30, 2023(1):
| As Adjusted, December 31, 2022 |  | As Previously Filed, December 31, 2022
(in millions) | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount
Intangible assets subject to amortization: |  |  |  |  |  |  |  |  |  |
Capitalized software development costs | $ | 25.0 |  |  | $ | (2.9) |  |  | $ | 22.1 |  |  | $ | 5.5 |  |  | $ | (2.9) |  |  | $ | 2.6 |
Trademarks | 19.8 |  |  | (5.8) |  |  | 14.0 |  |  | 39.3 |  |  | (5.8) |  |  | 33.5 |
__________________ (1) The Company recorded an immaterial reclassification adjustment between the intangible assets balances in Trademarks and Capitalized Software Development Costs in the amount of $19.5 million, for the year ended December 31, 2022. There was no impact on total intangible assets, net as for December 30, 2022. The adjusted balances were reflected in the Form 10-Q for the quarter ended September 30, 2023, filed with the SEC November 8, 2023. Finite lived intangible assets have a weighted-average amortization period ranging from twelve years to fourteen years. Total amortization expense for the years ended December 30, 2023, December 31, 2022 and January 1, 2022, was $54.4 million, $39.8 million and $10.3 million, respectively. Total unamortized capitalized software development costs for the years ended December 30, 2023 was $11.9 million. There was no unamortized capitalized software development costs for the year ended December 31, 2022. The total costs of patents not yet amortizing for the years ended December 30, 2023 and December 31, 2022, was $12.1 million and $10.6 million, respectively. The total costs of trademarks not yet amortizing for the years ended December 30, 2023 and December 31, 2022, was $1.0 million and $1.1 million, respectively. Total renewal costs capitalized for patents and trademarks for the years ended December 30, 2023 and December 31, 2022 were $1.0 million and $1.2 million, respectively. As of December 30, 2023, the weighted-average number of years until the next renewal was two years for patents and six years for trademarks. Estimated amortization expense for each of the next fiscal years is as follows:
Fiscal year | Amount (in millions)
2024 | $ | 53.7 |
2025 | 51.0 |
2026 | 40.1 |
2027 | 39.2 |
2028 | 39.0 |
Thereafter | 196.9 |
Total | $ | 419.9 |
Indefinite-lived intangible assets are subject to annual impairment testing, unless circumstances dictate more frequent testing, if impairment indicators exist. In the third quarter of 2023, declines in the Company’s stock price and certain worsening macro-economic market conditions, including continued slowing in demand for consumer audio products, contributed to a significant decline in the Company’s market capitalization, which led the Company to conclude a trigger event had occurred. As a result, the Company performed a quantitative impairment assessment, which resulted in recording a $7.0 million impairment charge for indefinite-lived trademarks in the non-healthcare reporting unit. In conjunction with this third quarter interim impairment quantitative assessment, the Company concluded that both the healthcare reporting unit’s and non-healthcare reporting unit’s respective estimated fair values exceeded their carrying values. Furthermore, recoverability tests performed for other long-lived assets with finite lives indicated no recoverability issues. During the fourth quarter of 2023, the Company performed its annual impairment analysis by first electing to complete a qualitative assessment of its indefinite-lived intangible assets. Based on this assessment, the Company determined it was not more likely than not that the fair value of the indefinite lived intangibles within the non-healthcare reporting unit exceeded their carrying values. Accordingly, the Company proceeded to perform a quantitative impairment assessment, which resulted in recording a $3.0 million impairment charge for indefinite-lived trademarks. For purposes of the impairment test, the fair value of indefinite-lived assets were determined using the same methodology as described in Note 18, “Business Combinations.” The estimates and assumptions applied represent a Level 3 measurement because they are supported by limited or no market activity and reflect the Company’s assumptions in measuring fair value. During the fourth quarter of 2023, the Company performed its annual goodwill impairment analysis by first electing to complete a qualitative assessment for its healthcare and non-healthcare reporting units. Based on this assessment, the Company concluded that it was more likely than not that the fair value of the healthcare reporting unit was greater than its carrying value. Accordingly, no further testing was required for the healthcare reporting unit. However, the Company concluded that it was not more likely than not that the fair value of the non-healthcare reporting unit was greater than its carrying value. Therefore, the Company proceeded to perform a quantitative assessment for its non-healthcare reporting unit. When a quantitative assessment is required for the impairment test for goodwill, the Company uses a combination of both an income and a market approach to determine the fair value of the reporting unit. The income approach utilized the estimated discounted cash flows for the reporting unit, while the market approach utilized comparable company information. Estimates and assumptions used in the income approach to calculate projected future discounted cash flows included revenue growth rates, operating margins and a discount rate for the reporting unit. Discount rates were determined using a weighted average cost of capital for risk factors specific to the reporting unit and other market and industry data. The assumptions used are inherently subject to uncertainty and the Company noted that slight changes in these assumptions could have a significant impact on the concluded value. The estimates and assumptions applied represent a Level 3 measurement because they are supported by limited or no market activity and reflect the Company’s assumptions in measuring fair value.

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