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Goodwill and Intangible Assets, Net | 12 Months Ended
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Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net Goodwill Goodwill has an estimated indefinite life and is not amortized; rather, it is reviewed for impairment at least annually or whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Our annual goodwill impairment review occurs on October 31 of each fiscal year. We evaluate qualitative factors that could cause us to believe the estimated fair value of our reporting unit may be lower than the carrying value and trigger a quantitative assessment, including, but not limited to (i) macroeconomic conditions, (ii) industry and market considerations, (iii) our overall financial performance, including an analysis of our current and projected cash flows, revenues and earnings, (iv) a sustained decrease in share price and (v) other relevant entity-specific events including changes in management, strategy, partners, or litigation. 2023 Goodwill Impairment Test On October 31, 2023, the Company performed its annual goodwill impairment review for fiscal year 2023. In addition, the Company underwent organizational changes which required a reassessment of reporting units. As a result, the Company determined it has one reporting unit due to the economic similarity of the services provided to our partners. Based on our qualitative assessment, we did not identify sufficient indicators of impairment that would suggest the fair value of our reporting unit was below its respective carrying values. As a result, a quantitative goodwill impairment analysis was not required. 2022 Goodwill Impairment Test On October 31, 2022, the Company performed its annual goodwill impairment test for fiscal year 2022. As a result of Bright HealthCare announcing its plan to exit its Individual and Family Plans line of business in 2023, thus negatively impacting the Company’s future revenues from such partner, the Company elected to forego the qualitative assessment and proceeded directly to the quantitative assessment of the goodwill impairment test for that specific reporting unit. In doing so, we estimated the fair value of the reporting unit by considering an income approach. In determining the estimated fair value using the income approach, we projected future cash flows based on management’s estimates and long-term plans and applied a discount rate based on the Company’s weighted average cost of capital. This analysis required us to make judgments about revenues, expenses, fixed asset and working capital requirements, capital market assumptions, cash flows and discount rates. The quantitative analysis of that reporting unit showed that the fair value exceeded the carrying value. Contracts with our customers may be cancelled or renegotiated and future revenue growth is dependent on winning new contracts. Further, the impairment analysis is particularly sensitive to changes in the projected revenue growth rates and expenses and the discount rate. Changes in these key assumptions such as a significant unfavorable change to our forecasted cash flows due to being unsuccessful in winning certain contracts or certain of our contracts being cancelled or renegotiated by our customers, could result in a revision of management’s estimates and could result in impairment charges in the future, which could be material to our results of operations. We will continue to monitor for such changes in facts or circumstances, which may be indicators of potential impairment triggers. For the remaining reporting units, after assessing the totality of events and circumstances including the results of our previous valuations, no events occurred or circumstances changed during the period under consideration that would, more likely than not, reduce the fair value of any reporting unit below their carrying amount. Therefore, the Company concluded that the quantitative assessment was not required. For all reporting units, it was determined that as of October 31, 2022, no impairment of goodwill had occurred. Change in Goodwill The following table summarizes the changes in the carrying amount of goodwill, for the periods presented (in thousands):
Balance as of December 31, 2021 |  |  |  |  | $ | 426,297 |
Goodwill acquired (1) |  |  |  |  | 296,597 |
Foreign currency translation |  |  |  |  | (120) |
Balance as of December 31, 2022 |  |  |  |  | 722,774 |
Goodwill acquired (1) |  |  |  |  | 395,164 |
Measurement period adjustments |  |  |  |  | 971 |
Goodwill disposal (2) |  |  |  |  | (2,363) |
Foreign currency translation |  |  |  |  | (4) |
Balance as of December 31, 2023 |  |  |  |  | $ | 1,116,542 |
———————— (1)Goodwill acquired from the addition of NIA in January 2023 and IPG in August 2022. (2)Goodwill written-off upon disposal of non-strategic assets. Intangible Assets, Net Details of our intangible assets (in thousands, except weighted-average useful lives) are presented below:
| December 31, 2023 |  | December 31, 2022
| Weighted- Average Remaining Useful Life |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Value |  | Weighted- Average Remaining Useful Life |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Value
Corporate trade name | 1.0 |  | $ | 51,965 |  |  | $ | 30,288 |  |  | $ | 21,677 |  |  | 12.7 |  | $ | 43,600 |  |  | $ | 11,726 |  |  | $ | 31,874 |
Customer relationships | 14.5 |  | 806,668 |  |  | 139,150 |  |  | 667,518 |  |  | 15.8 |  | 465,019 |  |  | 92,760 |  |  | 372,259 |
Technology | 3.8 |  | 162,015 |  |  | 101,566 |  |  | 60,449 |  |  | 2.7 |  | 111,822 |  |  | 80,255 |  |  | 31,567 |
Below market lease, net | 0.0 |  | 1,218 |  |  | 1,218 |  |  | — |  |  | 0.3 |  | 1,218 |  |  | 1,151 |  |  | 67 |
Provider network contracts | 1.1 |  | 18,054 |  |  | 15,689 |  |  | 2,365 |  |  | 1.3 |  | 18,851 |  |  | 11,834 |  |  | 7,017 |
Total intangible assets, net |  |  | $ | 1,039,920 |  |  | $ | 287,911 |  |  | $ | 752,009 |  |  |  |  | $ | 640,510 |  |  | $ | 197,726 |  |  | $ | 442,784 |
Amortization expense related to intangible assets was $91.0 million, $35.2 million and $29.4 million for the years ended December 31, 2023, 2022 and 2021, respectively, excluding $0.2 million of amortization expense related to discontinued operations for the year ended December 31, 2021. Future estimated amortization of intangible assets (in thousands) as of December 31, 2023, is as follows:
2024 | $ | 86,903 |
2025 | 63,360 |
2026 | 62,939 |
2027 | 60,198 |
2028 | 47,751 |
Thereafter | 430,858 |
Total future amortization of intangible assets | $ | 752,009 |
As part of the organizational changes as a result of growth in our value-based specialty care business, we will sunset several corporate trade names and replace them with Evolent signifying our adoption and launch of a unified brand. As a result, we accelerated amortization such that all corporate trade names will be fully amortized by December 2024. Intangible assets are reviewed for impairment if circumstances indicate the Company may not be able to recover the assets’ carrying value. We did not identify any circumstances during the years ended December 31, 2023, 2022 and 2021, that would require an impairment test for our intangible assets.

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