XML 22 R13.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Intangible Assets and Goodwill | 9 Months Ended
--- | ---
Sep. 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 September 30, 2022 and December 31, 2021 (in thousands):
| Useful Life (Years) |  | Weighted Average Remaining Life (Years) |  | September 30, 2022
|  | Intangible Assets |  | Accumulated Amortization |  | Net Balance
Customer relationships | 2 |  | 1.2 |  | $ | 31,659 |  |  | $ | (27,003) |  |  | $ | 4,656 |
Trade names | 2 - 9 |  | 6.5 |  | 38,781 |  |  | (10,854) |  |  | 27,927 |
Software and technology | 3 - 9 |  | 6.1 |  | 198,176 |  |  | (53,051) |  |  | 145,125 |
Gaming licenses and market access fees | 2 - 10 |  | 6.6 |  | 28,507 |  |  | (3,283) |  |  | 25,224 |
Total |  |  |  |  | $ | 297,123 |  |  | $ | (94,191) |  |  | $ | 202,932 |
| 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 ten years. The Company recorded amortization expense related to the above intangible assets of approximately $9.2 million and $9.1 million for the three months ended September 30, 2022 and 2021, respectively. The Company recorded amortization expense related to the above intangible assets of approximately $30.2 million and $27.3 million for the nine months ended September 30, 2022 and 2021, respectively. For the three and nine months ended September 30, 2022, in connection with the Company's Online Sportsbook, the Company recorded an impairment charge of approximately $0.2 million relating to gaming licenses and market access fees. The expense is recorded in impairment of goodwill, intangible assets, and other long-lived assets in the wagering segment on the accompanying condensed consolidated statements of operations and comprehensive loss. The estimated future amortization expense associated with intangible assets, net is as follows (in thousands):
Year ended December 31, | Future Amortization
2022 | $ | 12,221 |
2023 | 37,190 |
2024 | 32,797 |
2025 | 29,421 |
2026 | 28,557 |
Thereafter | 62,746 |
Total | $ | 202,932 |
Prepaid Market Access Agreements During the nine months ended September 30, 2022, the Company paid $3.5 million, respectively, for gaming licenses pursuant to market access agreements in states where the market access is pending regulatory approval as of September 30, 2022. The $3.5 million is included in other non-current assets on the accompanying condensed consolidated balance sheet as of September 30, 2022. For the three and nine months ended September 30, 2022, the Company recorded an impairment charge of approximately $35.0 million relating to prepaid market access fees. The expense is recorded in impairment of goodwill, intangible assets, and other long-lived assets in the wagering segment on the accompanying condensed consolidated statements of operations and comprehensive loss. As of September 30, 2022 and December 31, 2021, the balance of prepaid market access agreements was $8.2 million and $39.8 million, respectively. Goodwill The following table is a summary of the changes to goodwill for the nine months ended September 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 | (11,867) |  |  | — |  |  | $ | (11,867) |
Balance - September 30, 2022 | $ | 607,223 |  |  | $ | — |  |  | $ | 607,223 |
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 Company recorded a non-cash goodwill impairment charge of $10.7 million during the six 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 $607.2 million of goodwill. Therefore, no impairment charge was recorded during the interim impairment test. 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.

X
- References No definition available. + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration