Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Note 6. Goodwill and Intangible Assets

Goodwill

The following table presents the changes in the carrying amount of the goodwill for the nine months ended September 30, 2023 (in thousands):


	Amount
Ending balance as of December 31, 2022	$	2,337,036
Goodwill from acquisition	8,183
Foreign currency translation adjustment	(4,587)
Ending Balance as of September 30, 2023	$	2,340,632

Goodwill represents the excess of consideration paid over the estimated fair value of net tangible and identifiable intangible assets acquired in business combinations.

During the three months ended September 30, 2023, the Company recorded an addition to goodwill of $8.2 million from the acquisition of Privitar Limited, a data management access and privacy software provider that will support critical, high-growth use cases around cloud analytics, governance, data mesh, and data marketplace.

Intangible Assets

The carrying amounts of the intangible assets other than goodwill as of September 30, 2023 and December 31, 2022 are as follows (in thousands, except years):


	Weighted Average Useful Life (Years)	September 30, 2023						December 31, 2022
		Cost		Accumulated Amortization		Net		Cost		Accumulated Amortization		Net
Acquired developed and core technology	6	$	880,557	$	(868,095)	$	12,462	$	876,949	$	(859,319)	$	17,630
Other intangible assets:
Customer relationships	15	2,155,153		(1,457,001)		698,152		2,154,735		(1,359,837)		794,898
Trade names and trademark	7	81,551		(71,934)		9,617		81,442		(65,978)		15,464
Total other intangible assets		2,236,704		(1,528,935)		707,769		2,236,177		(1,425,815)		810,362
Total intangible assets, net		$	3,117,261	$	(2,397,030)	$	720,231	$	3,113,126	$	(2,285,134)	$	827,992

The Company amortizes its intangible assets over their remaining estimated useful life using cash flow projections, revenue projections, or the straight-line method. Total amortization expense related to intangible assets was $37.5 million and $46.9 million for the three months ended September 30, 2023 and 2022, respectively. Total amortization expense related to intangible assets was $111.9 million and $142.1 million for the nine months ended September 30, 2023 and 2022, respectively.

The allocation of the amortization of intangible assets for the periods indicated below is as follows (in thousands):


	Three Months Ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Cost of revenues	$	3,013	$	8,703	$	8,776	$	26,776
Operating expenses	34,481		38,231		103,120		115,351
Total amortization of intangible assets	$	37,494	$	46,934	$	111,896	$	142,127

Certain intangible assets are recorded in foreign currencies; and therefore, the gross carrying amount and accumulated amortization are subject to foreign currency translation adjustments.

As of September 30, 2023, the amortization expense related to identifiable intangible assets in future periods is expected to be as follows (in thousands):


	Acquired Developed and Core Technology		Other Intangible Assets		Total Intangible Assets

Remaining 2023	$	2,981	$	34,351	$	37,332
2024	3,874		121,428		125,302
2025	2,110		99,365		101,475
2026	1,410		86,399		87,809
2027	669		74,981		75,650
Thereafter	1,418		291,245		292,663
Total expected amortization expense	$	12,462	$	707,769	$	720,231