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Intangible Assets and Goodwill | 6 Months Ended
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Jun. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible Assets The table below summarizes the Company’s intangible assets at June 30, 2022 and December 31, 2021 (in thousands):
| Useful Life (Years) |  | Weighted Average Remaining Life (Years) |  | June 30, 2022
|  | Intangible Assets |  | Accumulated Amortization |  | Net Balance
Customer relationships | 2 |  | 1.2 |  | $ | 32,280 |  |  | $ | (26,187) |  |  | $ | 6,093 |
Trade names | 2 - 9 |  | 6.7 |  | 38,826 |  |  | (9,733) |  |  | 29,093 |
Software and technology | 3 - 9 |  | 6.4 |  | 197,174 |  |  | (47,193) |  |  | 149,981 |
Gaming licenses and market access fees | 2 - 5 |  | 4.1 |  | 15,701 |  |  | (2,184) |  |  | 13,517 |
Total |  |  |  |  | $ | 283,981 |  |  | $ | (85,297) |  |  | $ | 198,684 |
| Useful Lives (Years) |  | Weighted Average Remaining Life (Years) |  | December 31, 2021
|  | Intangible Assets |  | Accumulated Amortization |  | Net Balance
Customer relationships | 2 |  | 2.2 |  | $ | 32,965 |  |  | $ | (21,105) |  |  | $ | 11,860 |
Trade names | 2 - 9 |  | 7.2 |  | 38,876 |  |  | (7,455) |  |  | 31,421 |
Software and technology | 3 - 9 |  | 8.7 |  | 195,852 |  |  | (35,572) |  |  | 160,280 |
Gaming licenses and market access fees | 2 - 5 |  | 4.8 |  | 14,951 |  |  | $ | (326) |  |  | $ | 14,625 |
Total |  |  |  |  | $ | 282,644 |  |  | $ | (64,458) |  |  | $ | 218,186 |
The intangible assets are being amortized over their respective original useful lives, which range from two to nine years. The Company recorded amortization expense related to the above intangible assets of approximately $9.1 million and $9.1 million for the three months ended June 30, 2022 and 2021, respectively. The Company recorded amortization expense related to the above intangible assets of approximately $21.0 million and $18.1 million for the six months ended June 30, 2022 and 2021, respectively. The estimated future amortization expense associated with intangible assets, net is as follows (in thousands):
Year ended December 31, | Future Amortization
2022 | $ | 23,859 |
2023 | 33,919 |
2024 | 30,522 |
2025 | 27,731 |
2026 | 27,259 |
Thereafter | 55,394 |
Total | $ | 198,684 |
Prepaid Market Access Agreements During the six months ended June 30, 2022, the Company paid $3.5 million for gaming licenses pursuant to market access agreements in states where the market access is pending regulatory approval as of June 30, 2022. The $3.5 million is included in other non-current assets on the accompanying condensed consolidated balance sheet as of June 30, 2022. Goodwill The following table is a summary of the changes to goodwill for the six months ended June 30, 2022 (in thousands):
| Streaming |  | Wagering |  | Total
Balance - December 31, 2021 | $ | 619,587 |  |  | $ | 10,682 |  |  | $ | 630,269 |
Molotov purchase accounting adjustment | (497) |  |  | — |  |  | (497) |
Impairment | — |  |  | (10,682) |  |  | $ | (10,682) |
Foreign currency translation adjustment | (2,813) |  |  | — |  |  | $ | (2,813) |
Balance - June 30, 2022 | $ | 616,277 |  |  | $ | — |  |  | $ | 616,277 |
Annually, or upon the identification of a triggering event, management is required to perform an evaluation of the recoverability of goodwill. Triggering events potentially warranting an interim goodwill impairment test include, among other factors, declines in historical or projected revenue, operating income or cash flows, and sustained declines in the Company’s stock price or market capitalization, considered both in absolute terms and relative to peers. We measure recoverability of goodwill at the reporting unit level. As a result of sustained decreases in the Company’s stock price and market capitalization, the Company conducted an interim impairment test of its goodwill and long-lived assets as of June 30, 2022. The process of determining the fair value of a reporting unit is highly subjective and involves the use of significant estimates and assumptions. The Company’s June 30, 2022 goodwill impairment test reflected an allocation of 50% and 50% between income and market-based approaches, respectively. The income-based approach also takes into account the future growth and profitability expectations. Significant inputs into the valuation models included the control premium, discount rate, and revenue market multiples as follows:
| Streaming |  | Wagering
Control premium | 30.0% |  | 30.0%
Discount rate | 27.0% |  | 19.5%
Revenue multiples | 0.4x to 0.7x |  | 0.4x to 0.7x
As a result of this testing, the Company recorded a non-cash goodwill impairment charge of $10.7 million during the three months ended June 30, 2022 for the wagering segment due to changes in operating conditions, including temporary delays of launches in new markets. The impairment charge represents all of the goodwill in the wagering segment. The results of the impairment test also showed that the fair value of the streaming segment as a percentage of its carrying value was 101.7%, with the carrying value including approximately $616.3 million of goodwill. Therefore, no impairment charge was recorded during the quarter. No impairments were recorded to long-lived assets in either segment. While management cannot predict if or when additional future goodwill impairments may occur, additional goodwill impairments could have material adverse effects on the Company’s operating income, net assets, and/or the Company’s cost of, or access to, capital. Goodwill includes an accumulated impairment charge of $148.1 million related to the historical Facebank reporting unit included in the streaming segment and $10.7 million in the wagering segment.

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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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