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Goodwill, Internal-use Software Development Costs and Intangible Assets | 9 Months Ended
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Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill, Internal-use Software Development Costs and Intangible Assets | 6. Goodwill, Internal-use Software Development Costs and Intangible Assets Goodwill The changes in the carrying amount of goodwill by reporting unit were as follows (in thousands):
|  | United States |  |  | Other |  |  | Total |
Balance as of December 31, 2021 |  | $ | 128,519 |  |  | $ | 894 |  |  | $ | 129,413 |
Foreign currency translation adjustments |  |  | — |  |  |  | (69 | ) |  |  | (69 | )
Balance as of September 30, 2022 |  | $ | 128,519 |  |  | $ | 825 |  |  | $ | 129,344 |
Internal-use Software Development Costs The Company capitalizes qualifying internal-use software development costs related to its platform. The costs consist of personnel costs (including related benefits) that are incurred during the application development stage, as well as implementation costs incurred to fulfill our contracts with customers as they (1) relate directly to the contract, (2) are expected to generate resources that will be used to satisfy the performance obligation under the contract, and (3) are expected to be recovered through revenues generated under the contract. Capitalization of costs begins when two criteria are met: (1) the preliminary project stage is completed, and (2) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. Costs related to preliminary project activities and post-implementation operating activities are expensed as incurred. During the three months ended September 30, 2022 and 2021, the Company capitalized $7.8 million and $4.8 million in software development costs, respectively, and during the nine months ended September 30, 2022 and 2021, the Company capitalized $22.3 million and $13.5 million in software development costs, respectively. Capitalized costs are amortized over the estimated useful life of the software, which management estimated to be a range of three to five years, and are recorded on a straight-line basis, which represents the manner in which the expected benefit will be derived. Amortization expense is recorded in cost of revenue and operating expenses in the condensed consolidated statement of operations aligned with the internal organizations that are the primary beneficiaries of such assets. During the three months ended September 30, 2022 and 2021, the Company recorded $2.4 million and $1.3 million of amortization expense in cost of revenue, and $1.4 million and $1.2 million of amortization expense in operating expenses, respectively. During the nine months ended September 30, 2022 and 2021, the Company recorded $6.1 million and $3.5 million of amortization expense in cost of revenue, and $4.3 million and $3.3 million of amortization expense in operating expenses, respectively. Intangible Assets Intangible assets, net consisted of the following (in thousands):
|  | September 30, 2022 |
|  | Gross Carrying Amount |  |  | Accumulated Amortization |  |  | Net Carrying Amount |  |  | Weighted- Average Useful Life (Years) |
Technology |  | $ | 20,797 |  |  | $ | (11,131 | ) |  | $ | 9,666 |  |  |  | 4.0 |
License |  |  | 2,479 |  |  |  | (2,479 | ) |  |  | — |  |  |  | — |
Customer relationship |  |  | 33,781 |  |  |  | (10,759 | ) |  |  | 23,022 |  |  |  | 8.0 |
Software |  |  | 1,109 |  |  |  | (596 | ) |  |  | 513 |  |  |  | 3.0 |
Trademark |  |  | 4,193 |  |  |  | (1,281 | ) |  |  | 2,912 |  |  |  | 4.0 |
Total |  | $ | 62,359 |  |  | $ | (26,246 | ) |  | $ | 36,113 |  |  |  |
|  | December 31, 2021 |
|  | Gross Carrying Amount |  |  | Accumulated Amortization |  |  | Net Carrying Amount |  |  | Weighted- Average Useful Life (Years) |
Technology |  | $ | 20,837 |  |  | $ | (8,655 | ) |  | $ | 12,182 |  |  |  | 4.0 |
License |  |  | 2,652 |  |  |  | (2,652 | ) |  |  | — |  |  |  | — |
Customer relationship |  |  | 33,830 |  |  |  | (8,021 | ) |  |  | 25,809 |  |  |  | 8.0 |
Software |  |  | 893 |  |  |  | (456 | ) |  |  | 437 |  |  |  | 3.0 |
Trademark |  |  | 4,193 |  |  |  | (533 | ) |  |  | 3,660 |  |  |  | 4.0 |
Total |  | $ | 62,405 |  |  | $ | (20,317 | ) |  | $ | 42,088 |  |  |  |
Amortization expense of intangible assets was $2.0 million and $1.0 million for the three months ended September 30, 2022 and 2021, respectively, and $6.2 million and $1.1 million for the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022, future expected amortization expense is as follows (in thousands):
Years Ending December 31, |  |  |
2022 (remaining three months) |  | $ | 2,066 |
2023 |  |  | 8,082 |
2024 |  |  | 7,807 |
2025 |  |  | 6,169 |
2026 |  |  | 3,283 |
Thereafter |  |  | 8,706 |
Total future amortization expense |  | $ | 36,113 |

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI https://asc.fasb.org/topic&trid=2144416 + Details
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