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Goodwill and Other Intangible Assets, Net | 12 Months Ended
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Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets, Net | Goodwill and Other Intangible Assets, Net A summary of changes in the Company’s goodwill by reportable business segment is as follows for 2022 and 2021 (in millions):
|  |  |  |  |  |  |  |  |  | December 31, 2022
Segments: |  | Net Book Value at December 31, 2021 |  |  |  | Impairment Charges |  | Foreign Exchange |  | Gross Carrying Amount |  | Accumulated Impairment Charges |  | Net Book Value
Commercial Solutions |  | $ | 747 |  |  |  |  | $ | — |  |  | $ | — |  |  | $ | 916 |  |  | $ | (169) |  |  | $ | 747 |
Home Appliances |  | — |  |  |  |  | — |  |  | — |  |  | 569 |  |  | (569) |  |  | — |
Home Solutions |  | 164 |  |  |  |  | (164) |  |  | — |  |  | 2,567 |  |  | (2,567) |  |  | — |
Learning and Development |  | 2,593 |  |  |  |  | — |  |  | (42) |  |  | 3,397 |  |  | (846) |  |  | 2,551 |
Outdoor and Recreation |  | — |  |  |  |  | — |  |  | — |  |  | 788 |  |  | (788) |  |  | — |
|  | $ | 3,504 |  |  |  |  | $ | (164) |  |  | $ | (42) |  |  | $ | 8,237 |  |  | $ | (4,939) |  |  | $ | 3,298 |
During the fourth quarter of 2022, in conjunction with its annual impairment testing, the Company recorded a non-cash impairment charge to write-off the remaining $56 million of goodwill for its Home Fragrance reporting unit, in the Home Solutions segment as the carrying value exceeded its fair value. This impairment reflected a further downward revision to the forecasted cash flows used in connection with the third quarter triggering event assessment, driven by inflationary pressures which continue to impact discretionary spending behavior of consumers at higher rates than previously expected. The Baby reporting unit in the Learning and Development segment had a fair value within 10% of its associated carrying value. A hypothetical 10% reduction in forecasted earnings before interest, taxes and amortization used in the discounted cash flows to estimate the fair value to this reporting unit would have resulted in an impairment charge of approximately $120 million against its goodwill carrying value of $653 million. During the third quarter of 2022, the Company concluded that a triggering event had occurred for its Home Fragrance reporting unit, in the Home Solutions segment, as a result of a downward revision of forecasted cash flows due to softening global demand, as retailers significantly pulled back on orders in an effort to rebalance inventory, and rising interest rates. The decline in global demand is driven primarily by inflationary pressures which are impacting the discretionary spending behavior of consumers. The Company performed a quantitative impairment test and determined that the Home Fragrance reporting unit goodwill was impaired. During the third quarter of 2022 the Company recorded a non-cash impairment charge of $108 million, as the carrying value of the reporting unit exceeded its fair value.
|  |  |  |  |  |  |  |  |  | December 31, 2021
Segments: |  | Net Book Value at December 31, 2020 |  |  |  |  |  | Foreign Exchange |  | Gross Carrying Amount |  | Accumulated Impairment Charges |  | Net Book Value
Commercial Solutions |  | $ | 747 |  |  |  |  |  |  | $ | — |  |  | $ | 1,241 |  |  | $ | (494) |  |  | $ | 747 |
Home Appliances |  | — |  |  |  |  |  |  | — |  |  | 569 |  |  | (569) |  |  | — |
Home Solutions |  | 164 |  |  |  |  |  |  | — |  |  | 2,567 |  |  | (2,403) |  |  | 164 |
Learning and Development |  | 2,642 |  |  |  |  |  |  | (49) |  |  | 3,439 |  |  | (846) |  |  | 2,593 |
Outdoor and Recreation |  | — |  |  |  |  |  |  | — |  |  | 788 |  |  | (788) |  |  | — |
|  | $ | 3,553 |  |  |  |  |  |  | $ | (49) |  |  | $ | 8,604 |  |  | $ | (5,100) |  |  | $ | 3,504 |
The impairment charges for indefinite-lived tradenames were recorded in the Company’s reporting segments as follows for the years ended December 31, (in millions):
| 2022 (1) |  | 2021 (2) |  | 2020 (3)
Impairment of indefinite-lived tradenames |  |  |  |  |
Commercial Solutions | $ | — |  |  | $ | 29 |  |  | $ | 320 |
Home Appliances | 15 |  |  | — |  |  | 87 |
Home Solutions | 265 |  |  | — |  |  | 290 |
Learning and Development | 30 |  |  | 31 |  |  | 100 |
Outdoor and Recreation | — |  |  | — |  |  | 482 |
| $ | 310 |  |  | $ | 60 |  |  | $ | 1,279 |
(1)During the fourth quarter of 2022, in conjunction with its annual impairment testing, the Company recorded aggregate non-cash impairment charges of $270 million associated with two tradenames in the Home Solutions segment and one tradename in the Learning and Development segment, as the carrying values exceeded their fair values. The decline in fair values for one tradename in the Home Solutions segment and the tradename in the Learning and Development segment reflected a further downward revision to the forecasted cash flows used in connection with the third quarter triggering event assessment, driven by inflationary pressures which are impacting discretionary spending behavior of consumers at higher rates than previously expected, including higher than expected overhead costs. The decline in fair value for the remaining tradename in the Home Solutions segment reflected a change in management's assumptions, including the timing of a labor shortage recovery in a certain international market, which negatively impacted the long-term profitability estimates used to develop the forecasted cash flow projections for the annual impairment test. During the third quarter of 2022, the Company concluded that a triggering event had occurred for one indefinite-lived tradename in each of the Home Appliances and Home Solutions segments, as a result of a downward revision of forecasted cash flows due to softening global demand, as retailers significantly pulled back on orders in an effort to rebalance inventory and rising interest rates. The decline in global demand is driven primarily by inflationary pressures which are impacting the discretionary spending behavior of consumers. The Company also concluded that a triggering event had occurred for two indefinite-lived tradenames in the Learning and Development segment, as a result of rising interest rates and inflationary pressures. The Company performed a quantitative impairment test and determined that the indefinite-lived tradename in the Home Appliances segment and two indefinite-lived tradenames in the Learning and Development segment were impaired. During the third quarter of 2022, the Company recorded an aggregate non-cash impairment charge of $40 million, as the carrying values of these tradenames exceeded their fair values. (2)During the fourth quarter of 2021, in conjunction with its annual impairment testing, the Company recorded non-cash impairment charges of $60 million associated with tradenames in the Commercial Solution and Learning and Development segments, as the carrying values exceeded their fair values, reflecting a downward revision of future expected cash flows, which include the impact of the COVID-19 global pandemic. (3)During the fourth quarter of 2020, in conjunction with its annual impairment testing, the Company recorded a non-cash impairment charge of $20 million associated with a tradename in the Learning and Development segment, as its carrying value exceeded its fair value. The impairment reflected a downward revision of forecasted results due to the impact of the delayed and limited re-opening of schools and offices as a result of the COVID-19 global pandemic, as well as the continued deterioration in sales for slime-related adhesive products. During the first quarter of 2020, as a result of the impairment testing performed in connection with COVID-19 pandemic triggering event, the Company determined that certain of its indefinite-lived intangible assets in all of its operating segments were impaired and recorded non-cash impairment charges of $1.3 billion to reflect the impairment of these indefinite-lived tradenames because their carrying values exceeded their fair values. One tradename in the Home Solutions segment had a fair value within 10% of its associated carrying values of $25 million. A hypothetical 10% reduction in forecasted earnings before interest, taxes and amortization used in the discounted cash flows to estimate the fair value of this tradename would have resulted in an additional impairment charge of $2 million. In addition, one tradename in the Home Solutions segment, one tradename in the Learning and Development segment, and one tradename in the Outdoor and Recreation Segment had fair values within 10% of their associated carrying values of $68 million, $36 million, and $58 million, respectively. A hypothetical increase of 100 basis points in the discount rate used in the discounted cash flows to estimate fair values of these tradenames would have resulted in additional impairment charges of $7 million, $5 million, and $3 million, respectively. The table below summarizes the balance of other intangible assets, net and the related amortization periods using the straight-line method and attribution method at December 31, 2022 and 2021 (in millions):
| December 31, 2022 |  | December 31, 2021 |  |
| Gross Carrying Amount |  | Accumulated Amortization |  | Net Book Value |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Book Value |  | Amortization Periods (In years)
Tradenames - indefinite life | $ | 1,689 |  |  | $ | — |  |  | $ | 1,689 |  |  | $ | 2,219 |  |  | $ | — |  |  | $ | 2,219 |  |  | N/A
Tradenames - other | 160 |  |  | (79) |  |  | 81 |  |  | 159 |  |  | (65) |  |  | 94 |  |  | 2 - 15
Capitalized software | 602 |  |  | (481) |  |  | 121 |  |  | 631 |  |  | (495) |  |  | 136 |  |  | 3 - 12
Patents and intellectual property | 22 |  |  | (17) |  |  | 5 |  |  | 22 |  |  | (14) |  |  | 8 |  |  | 3 - 14
Customer relationships and distributor channels | 1,072 |  |  | (319) |  |  | 753 |  |  | 1,216 |  |  | (303) |  |  | 913 |  |  | 3 - 30
| $ | 3,545 |  |  | $ | (896) |  |  | $ | 2,649 |  |  | $ | 4,247 |  |  | $ | (877) |  |  | $ | 3,370 |  |  |
Amortization expense for intangible assets was $100 million, $120 million and $157 million in 2022, 2021 and 2020, respectively. At December 31, 2022, the aggregate estimated intangible amortization amounts for the succeeding five years are as follows (in millions):
Years ending December 31, |  | Amount
2023 |  | $ | 97 |
2024 |  | 89 |
2025 |  | 79 |
2026 |  | 68 |
2027 |  | 59 |
Thereafter |  | 568 |

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