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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 | 6. Goodwill and Intangible Assets The Company has approximately $1.6 billion of goodwill and $508 million of identified intangible assets at December 31, 2024. Goodwill is identified by segment as follows (in millions):
|  | Energy Products and Services |  |  | Energy Equipment |  |  | Total |
Balance at December 31, 2022 |  | $ | 729 |  |  | $ | 776 |  |  | $ | 1,505 |
Goodwill acquired during period |  |  | — |  |  |  | 40 |  |  |  | 40 |
Adjustment during the measurement period of assets acquired |  |  | 17 |  |  |  | — |  |  |  | 17 |
Balance at December 31, 2023 |  | $ | 746 |  |  | $ | 816 |  |  | $ | 1,562 |
Goodwill acquired during period |  |  | 70 |  |  |  | — |  |  |  | 70 |
Currency translation adjustments and other |  |  | (2 | ) |  |  | — |  |  |  | (2 | )
Balance at December 31, 2024 (1) |  | $ | 814 |  |  | $ | 816 |  |  | $ | 1,630 |
(1) Accumulated goodwill impairment was $7,261 million as of December 31, 2024. Identified intangible assets with determinable lives consist primarily of customer relationships, trademarks, trade names, patents, and technical drawings acquired in acquisitions, and are being amortized in a manner consistent with the underlying cash flows over the estimated useful lives of 2-40 years. Amortization expense of identified intangibles is expected to be approximately $51 million, $49 million, $45 million, $40 million, and $30 million for the next five years. As of December 31, 2024, we provisionally recorded $102 million of amortizable intangible assets that were acquired through several strategic acquisitions made during the year. The fair value of the assets acquired are preliminary and subject to change until we finalize our accounting for these acquisitions. The net book values of identified intangible assets are identified by segment as follows (in millions):
|  | Energy Products and Services |  |  | Energy Equipment |  |  | Total |
Balance at December 31, 2022 |  | $ | 319 |  |  | $ | 171 |  |  | $ | 490 |
Additions to intangible assets |  |  | 2 |  |  |  | — |  |  |  | 2 |
Amortization |  |  | (22 | ) |  |  | (21 | ) |  |  | (43 | )
Currency translation adjustments and other |  |  | — |  |  |  | 1 |  |  |  | 1 |
Balance at December 31, 2023 |  | $ | 299 |  |  | $ | 151 |  |  | $ | 450 |
Additions to intangible assets |  |  | 1 |  |  |  | 6 |  |  |  | 7 |
Intangible assets acquired |  |  | 102 |  |  |  | — |  |  |  | 102 |
Amortization |  |  | (28 | ) |  |  | (21 | ) |  |  | (49 | )
Currency translation adjustments and other |  |  | — |  |  |  | (2 | ) |  |  | (2 | )
Balance at December 31, 2024 |  | $ | 374 |  |  | $ | 134 |  |  | $ | 508 |
Identified intangible assets by major classification consist of the following (in millions):
|  | Gross |  |  | Accumulated Amortization |  |  | Net Book Value |
December 31, 2023: |  |  |  |  |  |  |  |  |
Customer relationships |  | $ | 494 |  |  | $ | (369 | ) |  | $ | 125 |
Trademarks |  |  | 174 |  |  |  | (133 | ) |  |  | 41 |
Patents |  |  | 129 |  |  |  | (75 | ) |  |  | 54 |
Indefinite-lived trade names |  |  | 196 |  |  |  | — |  |  |  | 196 |
Other |  |  | 105 |  |  |  | (71 | ) |  |  | 34 |
Total identified intangibles |  | $ | 1,098 |  |  | $ | (648 | ) |  | $ | 450 |
December 31, 2024: |  |  |  |  |  |  |  |  |
Customer relationships |  | $ | 531 |  |  | $ | (388 | ) |  | $ | 143 |
Trademarks |  |  | 194 |  |  |  | (139 | ) |  |  | 55 |
Patents |  |  | 153 |  |  |  | (85 | ) |  |  | 68 |
Indefinite-lived trade names |  |  | 196 |  |  |  | — |  |  |  | 196 |
Other |  |  | 125 |  |  |  | (79 | ) |  |  | 46 |
Total identified intangibles |  | $ | 1,199 |  |  | $ | (691 | ) |  | $ | 508 |
The following table presents intangible assets that were acquired during the year ended December 31, 2024 by major classification (in millions):
|  | Gross |  |  | Accumulated Amortization |  |  | Net Book Value |  |  | Weighted Average Amortization Period (in years) |
December 31, 2024: |  |  |  |  |  |  |  |  |  |  |  |
Customer relationships |  | $ | 39 |  |  | $ | (3 | ) |  | $ | 36 |  |  |  | 9.2 |
Trademarks |  |  | 21 |  |  |  | (2 | ) |  |  | 19 |  |  |  | 9.6 |
Patents |  |  | 27 |  |  |  | (4 | ) |  |  | 23 |  |  |  | 5.0 |
Other |  |  | 15 |  |  |  | — |  |  |  | 15 |  |  |  | 5.0 |
Total identified intangibles |  | $ | 102 |  |  | $ | (9 | ) |  | $ | 92 |  |  |  | 7.6 |
Goodwill represents the excess of acquisition price paid over the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed. Goodwill and intangibles with indefinite lives are not amortized. Goodwill is assigned to the reporting units that are expected to benefit from the synergies of a business combination. The recoverability of goodwill and indefinite-lived intangibles is assessed annually, or more frequently whenever events or circumstances indicate they might be impaired. The Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit or indefinite lived intangible asset is greater than its carrying amount. If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting or indefinite lived intangible asset is greater than its carrying amount, no further testing is required. However, if the Company concludes otherwise, then it is required to perform a quantitative assessment. If and when the Company performs a quantitative assessment, it compares the reporting unit’s carrying value to the respective fair value. Fair value of the reporting unit is determined using significant unobservable inputs, or level 3 in the fair value hierarchy. These inputs are based on internal management estimates, forecasts and judgments, using discounted cash flow. The discounted cash flow is based on management’s forecast of operating performance for the reporting unit. The two main assumptions used in measuring goodwill impairment, which bear the risk of change and could impact the Company’s goodwill impairment analysis, include the cash flows from operations from each reporting unit and its weighted average cost of capital. The starting point for each of the reporting unit’s cash flows from operations is the detailed annual plan or updated forecast. Cash flows beyond the updated forecasted operating plans are estimated using a terminal value calculation, which incorporates historical and forecasted financial cyclical trends for each reporting unit and considered long-term earnings growth rates. The financial and credit market volatility directly impacts our fair value measurement through our weighted average cost of capital that we use to determine our discount rate. During times of volatility, significant judgment must be applied to determine whether credit changes are a short-term or long-term trend. The quantitative analysis for indefinite lived intangible assets is performed similarly using an income approach. Management reviews finite-lived intangibles for indicators of impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Cash flows expected to be generated by the finite-lived intangibles are estimated over the intangible asset’s useful life based on updated projections on an undiscounted basis. If the evaluation indicates that the carrying value of the finite-lived intangible asset may not be recoverable, the potential impairment is measured at fair value. During the fourth quarter of 2024, the Company performed its annual impairment test, as described in ASC Topic 350, by electing to first perform a qualitative assessment. Based on the results of the assessment, the Company concluded it was more likely than not that the fair values of each of its reporting units and indefinite lived intangible assets was greater than its carrying value and no further testing was performed. No impairment of goodwill or indefinite-lived intangible assets was recorded in 2024 or 2023.

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