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Goodwill and Intangible Assets | 12 Months Ended
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Jan. 29, 2023
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The carrying amounts of goodwill by applicable reporting unit were as follows:
(in thousands) | Signal Integrity |  | Advanced Protection and Sensing (f.k.a. Protection) |  | IoT System (f.k.a. Wireless and Sensing) |  | IoT Connected Services |  | Unallocated |  | Total
Balance at January 30, 2022 | $ | 274,085 |  |  | $ | 4,928 |  |  | $ | 72,128 |  |  | $ | — |  |  | $ | — |  |  | $ | 351,141 |
Reallocation | — |  |  | 10,546 |  |  | (10,546) |  |  | — |  |  | — |  |  | — |
Addition for acquisition | — |  |  | — |  |  | — |  |  | — |  |  | 931,397 |  |  | 931,397 |
Reduction for disposal | — |  |  | (835) |  |  | — |  |  | — |  |  | — |  |  | (835) |
Balance at January 29, 2023 | $ | 274,085 |  |  | $ | 14,639 |  |  | $ | 61,582 |  |  | $ | — |  |  | $ | 931,397 |  |  | $ | 1,281,703 |
Goodwill is not amortized, but is tested for impairment at the reporting unit level using either a qualitative or quantitative assessment on an annual basis during the fourth quarter of each fiscal year, and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Impairment of goodwill is measured at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair market value of the reporting unit (see Note 16, Segment Information). As discussed in Note 3, Acquisition and Divestiture, on January 12, 2023, the Company acquired all of the outstanding equity interests in Sierra Wireless. A preliminary goodwill balance of $931.4 million was recognized for the excess of the consideration transferred over the net assets acquired and represents the expected revenue and cost synergies of the combined company and assembled workforce. Goodwill resulting from this transaction has not yet been allocated at the reporting unit level, but will be allocated to the IoT System and IoT Connected Services reporting units when the purchase price allocation is finalized during the measurement period and an analysis has been completed to determine an appropriate allocation based on the relative fair value of each of these reporting units. As a result of the divestiture of the Disposal Group during fiscal year 2023, the Company recorded a reduction to its goodwill of $0.8 million based on the relative fair value of the Disposal Group and the portion of the applicable reporting unit that will be retained. See Note 3, Acquisition and Divestiture, for additional information. As a result of the restructuring of the Company's reporting units during the fourth quarter of fiscal year 2023, the Company reallocated $10.5 million of goodwill from the IoT System reporting unit, formerly the Wireless and Sensing reporting unit, to the Advanced Protection and Sensing reporting unit, formerly the Protection reporting unit, based on the relative fair value of the proximity sensing business and power business (see Note 16, Segment Information). For fiscal year 2023, prior to and subsequent to the restructuring of the Company's reporting units, the Company performed a quantitative assessment that demonstrated that the fair value of each of the reporting units was higher than their respective carrying values. For fiscal years 2022 and 2021, the Company performed a qualitative assessment and concluded that it was more likely than not that the fair value of each of the reporting units exceeded its carrying value. As of January 29, 2023 and January 30, 2022, there were no indications of impairment of the Company's goodwill balances, and no impairment to goodwill was recorded during fiscal years 2023, 2022 or 2021. Purchased Intangibles The following table sets forth the Company’s finite-lived intangible assets resulting from business acquisitions, which are amortized over their estimated useful lives:
|  |  | January 29, 2023 |  | January 30, 2022
(in thousands) | Estimated Useful Life |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount
Core technologies | 1-8 years |  | $ | 175,080 |  |  | $ | (21,156) |  |  | $ | 153,924 |  |  | $ | 26,300 |  |  | $ | (19,496) |  |  | $ | 6,804 |
Customer relationships | 1-10 years |  | 53,000 |  |  | (690) |  |  | 52,310 |  |  | — |  |  | — |  |  | — |
Trade name | 2-10 years |  | 9,000 |  |  | (132) |  |  | 8,868 |  |  | — |  |  | — |  |  | — |
Total finite-lived intangible assets |  |  | $ | 237,080 |  |  | $ | (21,978) |  |  | $ | 215,102 |  |  | $ | 26,300 |  |  | $ | (19,496) |  |  | $ | 6,804 |
Amortization expense of finite-lived intangible assets was as follows:
(in thousands) | January 29, 2023 |  | January 30, 2022 |  | January 31, 2021
Core technologies | $ | 5,660 |  |  | $ | 4,942 |  |  | $ | 7,676 |
Customer relationships | 690 |  |  | — |  |  | 589 |
Trade name | 132 |  |  | — |  |  | — |
Total amortization expense | $ | 6,482 |  |  | $ | 4,942 |  |  | $ | 8,265 |
Amortization expense of finite-lived intangible assets related to core technologies was recorded in "Amortization of acquired technology" within "Total cost of sales" in the Statements of Income and amortization expense of finite-lived intangible assets related to customer relationships and trade name was recorded in "Intangible amortization" within "Total operating costs and expenses, net" in the Statements of Income. As of the Acquisition Closing Date, the weighted-average amortization period for the finite-lived intangible assets acquired in the Sierra Wireless Acquisition was 5.3 years, which reflects weighted-average amortization periods of 4.4 years, 7.9 years and 6.2 years for core technologies, customer relationships and trade name, respectively. Future amortization expense of finite-lived intangible assets is expected as follows:
(in thousands) | Core Technologies |  | Customer relationships |  | Trade name |  | Total
Fiscal year 2024 | $ | 41,474 |  |  | $ | 16,029 |  |  | $ | 3,167 |  |  | $ | 60,670 |
Fiscal year 2025 | 39,535 |  |  | 4,050 |  |  | 1,722 |  |  | 45,307 |
Fiscal year 2026 | 32,427 |  |  | 4,050 |  |  | 500 |  |  | 36,977 |
Fiscal year 2027 | 17,566 |  |  | 4,050 |  |  | 500 |  |  | 22,116 |
Fiscal year 2028 | 13,555 |  |  | 4,050 |  |  | 500 |  |  | 18,105 |
Thereafter | 9,367 |  |  | 20,081 |  |  | 2,479 |  |  | 31,927 |
Total expected amortization expense | $ | 153,924 |  |  | $ | 52,310 |  |  | $ | 8,868 |  |  | $ | 215,102 |

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