Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination and is assigned to the reporting unit that is expected to benefit from the synergies of the combination. Intangible assets resulting from the acquisitions of entities accounted for using the acquisition method of accounting are recorded at the estimated fair value of the assets acquired. Identifiable intangible assets are comprised of purchased customer relationships, trademarks and trade names, developed technologies and other intangible assets. The fair values of these identified intangible assets are based upon expected future cash flows or income, which take into consideration certain assumptions such as customer turnover, trade names and patent lives. These determinations are primarily based upon the Company’s historical experience and expected benefit of each intangible asset. If it is determined that such assumptions are not accurate, then the resulting change will impact the fair value of the intangible asset. Identifiable intangible assets are amortized over the period of estimated economic benefit, which ranges from one to twenty years.

The changes in carrying amounts of goodwill for the three months ended March 31, 2022 are as follows (in thousands):


	Digital Media		Cybersecurity and Martech		Consolidated
Balance as of January 1, 2022	$	996,659	$	534,796	$	1,531,455
Goodwill acquired (Note 3)	24,156		—		24,156


Purchase accounting adjustments(1)	2,139		2,034		4,173

Foreign exchange translation	(731)		(1,975)		(2,706)
Balance as of March 31, 2022	$	1,022,223	$	534,855	$	1,557,078

(1)Purchase accounting adjustments relate to measurement period adjustments to goodwill in connection with prior business acquisitions. Refer to Note 3 - Business Acquisitions.

Intangible Assets Subject to Amortization:

As of March 31, 2022, intangible assets subject to amortization relate primarily to the following (in thousands):


	Weighted-Average Amortization Period	Historical Cost		Accumulated Amortization		Net
Trade names	10.0 years	$	252,358	$	108,274	$	144,084
Customer relationships (1)	8.1 years	681,981		421,404		260,577
Other purchased intangibles	9.1 years	469,058		329,073		139,985
Total		$	1,403,397	$	858,751	$	544,646

(1)The Company amortizes customer relationship assets in a pattern that best reflects the pace at which the asset’s benefits are consumed. This pattern results in a substantial majority of the amortization expense being recognized in the first 4 to 5 years, despite the overall life of the asset.

As of December 31, 2021, intangible assets subject to amortization relate primarily to the following (in thousands):


	Weighted-Average Amortization Period	Historical Cost		Accumulated Amortization		Net
Trade names	9.7 years	$	250,418	$	102,657	$	147,761
Customer relationships (1)	8.1 years	673,847		398,396		275,451
Other purchased intangibles	9.3 years	467,028		317,515		149,513
Total		$	1,391,293	$	818,568	$	572,725

Amortization expense, included in General and administrative expense on our Condensed Consolidated Statements of Operations, approximated $41.2 million and $47.3 million for the three months ended March 31, 2022 and 2021, respectively.