Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

The table below sets forth the changes in the carrying amount of goodwill by reportable segment for the years ended December 31, 2024 and 2023.


	Healthcare		Education		Commercial		Total
Balance as of December 31, 2022:
Goodwill	$	644,238	$	123,652	$	312,968	$	1,080,858
Accumulated impairment losses	(190,024)		(1,417)		(264,451)		(455,892)
Goodwill, net as of December 31, 2022	$	454,214	$	122,235	$	48,517	$	624,966

Goodwill recorded in connection with a business combination(1)	745		—		—		745

Balance as of December 31, 2023:
Goodwill	$	644,983	$	123,652	$	312,968	$	1,081,603
Accumulated impairment losses	(190,024)		(1,417)		(264,451)		(455,892)
Goodwill, net as of December 31, 2023	$	454,959	$	122,235	$	48,517	$	625,711

Goodwill recorded in connection with business combinations(1)	869		22,476		32,134		55,479
Goodwill allocated to disposal of business(2)	(2,300)		—		—		(2,300)
Foreign currency translation	—		(147)		—		(147)
Balance as of December 31, 2024:
Goodwill	$	643,552	$	145,981	$	345,102	$	1,134,635
Accumulated impairment losses	(190,024)		(1,417)		(264,451)		(455,892)
Goodwill, net as of December 31, 2024:	$	453,528	$	144,564	$	80,651	$	678,743

(1) See Note 3 “Acquisitions and Divestiture” for additional information on business combinations completed in 2024, 2023 and 2022.

(2) In 2024, we completed the divestiture of our Studer Education practice within our Healthcare segment, and allocated a portion of goodwill within the Healthcare segment to the disposed practice based on the relative fair values of Studer Education and the remaining segment. The allocated goodwill of $2.3 million was written off and included in the gain on sale of Studer Education. The sale of Studer Education did not meet the criteria for reporting separately as discontinued operations. In connection with the sale, we recorded a $3.6 million pretax gain which is included in other income (expense), net in our consolidated statements of operations.

2024 Annual Goodwill Impairment Test

Pursuant to our policy, we performed our annual goodwill impairment test as of November 30, 2024 for our three reporting units: Healthcare, Education, and Commercial. We elected to bypass the qualitative assessment and utilized a quantitative goodwill impairment test to provide an updated fair value for each reporting unit as of the most recent valuation quantitative analysis performed was as of January 1, 2022.

We reviewed goodwill for impairment by comparing the fair value of the reporting unit to its carrying value, including goodwill. In estimating the fair value of the reporting unit, we relied on a combination of the income approach and the market approach utilizing the guideline company method, with a fifty-fifty weighting. Based on the results of the goodwill impairment test, we determined the fair value of the Healthcare, Education, and Commercial reporting units exceeded their carrying value by approximately 105%, 185%, and 335%, respectively. As such, we concluded that there is no indication of goodwill impairment for these three reporting units.

In the income approach, we utilized a discounted cash flow analysis, which involved estimating the expected after-tax cash flows that will be generated by each reporting unit and then discounting those cash flows to present value, reflecting the relevant risks associated with each reporting unit and the time value of money. This approach requires the use of significant estimates and assumptions, including forecasted revenue growth rates, forecasted EBITDA margins, and discount rates that reflect the risk inherent in the future cash flows. In estimating future cash flows, we relied on internally generated ten-year forecasts. Our forecasts are based on historical experience, current backlog, expected market demand, and other industry information.

In the market approach, we utilized the guideline company method, which involved calculating EBITDA multiples based on operating data from guideline publicly traded companies. Multiples derived from guideline companies provide an indication of how much a knowledgeable investor in the marketplace would be willing to pay for a company. These multiples were evaluated and adjusted based on specific characteristics of each of the reporting units relative to the selected guideline companies and applied to the reporting units' operating data to arrive at an indication of value.

Further, we evaluated whether any events have occurred or any circumstances have changed since November 30, 2024 that would indicate goodwill may have become impaired since our annual impairment test. Based on our evaluation as of December 31, 2024, we determined that no indications of impairment have arisen since our annual goodwill impairment test.

The results of an impairment analysis are as of a point in time. There is no assurance that the actual future earnings or cash flows of our reporting units will be consistent with our projections. We will monitor any changes to our assumptions and will evaluate goodwill as deemed warranted during future periods. Any significant decline in our operations could result in non-cash goodwill impairment charges.

2023 Annual Goodwill Impairment Test

Pursuant to our policy, we performed our annual goodwill impairment test as of November 30, 2023 for our three reporting units: Healthcare, Education, and Commercial. We performed a qualitative assessment considering the most recent quantitative analysis performed, actual performance, our internal financial projections, and current carrying value of each reporting unit; as well as other various factors, including macroeconomic conditions, relevant industry and market trends for each reporting unit, and other entity-specific events. Based on our evaluation as of November 30, 2023, we determined that there were no indications of goodwill impairment for any of our reporting units.

Intangible Assets

Intangible assets as of December 31, 2024 and 2023 consisted of the following:


		As of December 31,
		2024				2023
	Useful Life in Years	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Customer relationships	5 to 10	$	30,683	$	9,790	$	60,636	$	48,928
Technology and software	2 to 5	16,230		12,771		16,230		10,195
Trade names	6	6,000		6,000		6,000		6,000
Customer contracts	2 to 4	1,483		418		—		—
Non-competition agreements	2 to 5	1,260		601		720		389
Total		$	55,656	$	29,580	$	83,586	$	65,512

We acquired intangible assets related to our acquisitions of $14.6 million and $2.9 million during the years ended December 31, 2024 and 2023, respectively. These acquired intangible assets consist of customer relationships, technology and software, customer contracts and non-competition agreements. See Note 3 “Acquisitions and Divestiture” for additional information on the business acquisitions completed in 2024 and 2023. During the years ended December 31, 2024 and 2023, we wrote-off $42.4 million and $14.1 million, respectively, of fully amortized intangible assets no longer in use; which primarily consisted of customer relationships.

Identifiable intangible assets with finite lives are amortized over their estimated useful lives using either an accelerated or straight-line basis to correspond to the cash flows expected to be derived from the assets. Intangible assets amortization expense was $6.5 million, $8.2 million, and $11.2 million for the years ended December 31, 2024, 2023, and 2022, respectively. The table below sets forth the estimated annual amortization expense for each of the five succeeding years for the intangible assets recorded as of December 31, 2024.


Year Ending December 31,	Estimated Amortization Expense
2025	$	7,632
2026	$	5,882
2027	$	4,480
2028	$	3,606
2029	$	2,477

Actual future amortization expense could differ from these estimated amounts as a result of future acquisitions, dispositions, and other factors.