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Goodwill and Intangible Assets

6 Months Ended

Dec. 31, 2023

4. Goodwill and Intangible Assets

The changes in the carrying value of goodwill by segment for the six-month period ended December 31, 2023 were as follows (in thousands)


			Optoelectronics
			And
	Security		Manufacturing		Healthcare
	Division		Division		Division		Consolidated
Balance as of June 30, 2023	$	230,662	$	70,388	$	48,455	$	349,505
Goodwill acquired		2,072		828		—		2,900
Foreign currency translation adjustment		220		252		34		506
Balance as of December 31, 2023	$	232,954	$	71,468	$	48,489	$	352,911

Intangible assets consisted of the following (in thousands):


	June 30, 2023						December 31, 2023
	Gross						Gross
	Carrying		Accumulated		Intangibles		Carrying		Accumulated		Intangibles
	Value		Amortization		Net		Value		Amortization		Net
Amortizable assets:
Software development costs	$	77,844	$	(20,285)	$	57,559	$	83,570	$	(19,719)	$	63,851
Patents		8,636		(3,404)		5,232		8,886		(3,628)		5,258
Developed technology		68,274		(38,353)		29,921		71,332		(42,207)		29,125
Customer relationships		55,780		(39,101)		16,679		56,183		(42,601)		13,582
Total amortizable assets		210,534		(101,143)		109,391		219,971		(108,155)		111,816
Non-amortizable assets:
In-process R&D		533		—		533		—		—		—
Trademarks		30,933		—		30,933		31,472		—		31,472
Total intangible assets	$	242,000	$	(101,143)	$	140,857	$	251,443	$	(108,155)	$	143,288

Amortization expense related to intangible assets was $4.8 million and $5.7 million for the three months ended December 31, 2022 and 2023, respectively. For the six months ended December 31, 2022 and 2023, amortization expense related to intangible assets was $9.4 million and $10.4 million, respectively.

At December 31, 2023, the estimated future amortization expense for intangible assets was as follows (in thousands):

Fiscal Year


2024 (remaining 6 months)	$	9,877
2025		16,378
2026		12,751
2027		8,832
2028		5,829
Thereafter		58,149
Total	$	111,816

Software development costs for software products incurred before establishing technological feasibility are charged to operations. Software development costs incurred after establishing technological feasibility are capitalized on a product-by-product basis until the product is available for general release to customers at which time amortization begins. Annual amortization, charged to cost of goods sold, is the amount computed using the ratio that current revenues for a product compared to the total current and anticipated future revenues for that product. In the event that future revenues are not estimable, such costs are amortized on a straight-line basis over the remaining estimated economic life of the product. Amortizable assets that have not yet begun to be amortized are included in Thereafter in the table above. For each of the three months ended December 31, 2022 and 2023, we capitalized software development costs in the amounts of $4.0 million. For the six months ended December 31, 2022 and 2023, we capitalized software development costs in the amounts of $7.9 million and $8.0 million, respectively.