GOODWILL AND OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill was $502,341 and $472,326 as of June 30, 2024 and December 31, 2023, respectively. The increase in goodwill during the six months ended June 30, 2024 was primarily due to $56,028 from the acquisition of Nogin in the All Other category and $1,431 from an immaterial acquisition in the Financial Consulting segment, partially offset by $26,681 from goodwill impairment in the Consumer Products segment.

The changes in the carrying amount of goodwill for the six months ended June 30, 2024 were as follows:


	Capital Markets Segment		Wealth Management Segment		Auction and Liquidation Segment		Financial Consulting Segment		Communications Segment		Consumer Products Segment		All Other		Total
Balance as of December 31, 2023	$	162,018	$	51,195	$	1,975	$	33,310	$	193,867	$	26,681	$	3,280	$	472,326

Acquisition of other businesses	—		—		—		1,431		—		—		56,028		57,459
Goodwill impairment	—		—		—		—		—		(26,681)		—		(26,681)
Other	(532)		—		—		(231)		—		—		—		(763)
Balance as of June 30, 2024	$	161,486	$	51,195	$	1,975	$	34,510	$	193,867	$	—	$	59,308	$	502,341

During the six months ended June 30, 2024, the changes in goodwill included $(231) of foreign currency translation amounts and $(532) related to the sale of certain assets.

Intangible assets consisted of the following:


		As of June 30, 2024						As of December 31, 2023
	Estimated Useful Life in Years	Gross Carrying Value		Accumulated Amortization		Intangibles Net		Gross Carrying Value		Accumulated Amortization		Intangibles Net
Amortizable assets:
Customer relationships	1 to 16	$	281,008	$	(131,654)	$	149,354	$	272,399	$	(117,228)	$	155,171
Domain names	7	175		(173)		2		185		(183)		2
Advertising relationships	8	100		(100)		—		100		(94)		6
Internally developed software and other intangibles	0.5 to 10	32,935		(21,430)		11,505		28,985		(19,613)		9,372
Trademarks	3 to 10	24,025		(9,342)		14,683		20,821		(8,133)		12,688
Total		338,243		(162,699)		175,544		322,490		(145,251)		177,239

Non-amortizable assets:
Tradenames		143,776		—		143,776		144,775		—		144,775
Total intangible assets		$	482,019	$	(162,699)	$	319,320	$	467,265	$	(145,251)	$	322,014

Amortization expense was $9,298 and $10,103 during the three months ended June 30, 2024 and 2023, respectively, and $18,294 and $20,576 during the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, estimated future amortization expense was $16,728, $32,066, $28,939, $26,694, and $23,188 for the years ended December 31, 2024 (remaining six months), 2025, 2026, 2027 and 2028, respectively. The estimated future amortization expense after December 31, 2028 was $47,929.

The Company performs impairment tests for goodwill as of December 31 of each year and between annual impairment tests if an event occurs or circumstances change that would more likely than not reduce the fair values of the Company’s

reporting units below their carrying values. As a result of the current financial performance of the Company’s Targus subsidiary which is included in the Consumer Products segment as well as current market conditions that continued to exist in the personal computer market for computers and accessories, the Company updated its long-term forecasts. The Company performed an interim goodwill impairment quantitative assessment as of June 30, 2024, and based on the results of the analysis, the Company recorded a non-cash impairment charge of $27,681 consisting of a goodwill impairment charge of $26,681 and a tradename impairment charge of $1,000, which was recorded in impairment of goodwill and tradenames in the accompanying condensed consolidated statements of operations during the three and six months ended June 30, 2024.

Goodwill and tradename of the Company’s Targus subsidiary was measured at fair value on a nonrecurring basis as of June 30, 2024. The estimated fair value of goodwill was reduced to zero and the estimated fair value of tradename was $18,500 as of June 30, 2024. The estimated fair value of the Company’s Targus reporting unit was calculated using a weighted-average of values determined from an income approach and a market approach. The income approach involves estimating the fair value of the reporting unit by discounting its estimated future cash flows using a discount rate that would be consistent with a market participant’s assumption. The market approach bases the fair value measurement on information obtained from observed stock prices of public companies and recent merger and acquisition transaction data of comparable entities. In order to estimate the fair value of goodwill and tradename, management must make certain estimates and assumptions that affect the total fair value of the reporting unit including, among other things, an assessment of market conditions, projected cash flows, discount rates, and growth rates. The inputs for the fair value calculations of the reporting unit included a 4% growth rate to calculate the terminal value, a discount rate of 16%, and with respect to tradenames, a royalty rate of 2%. Management’s estimates of projected cash flows related to the reporting unit include, but are not limited to, future earnings of the reporting unit using revenue growth rates, gross margins, and other cost assumptions consistent with the reporting unit's historical trends, and working capital requirements and future capital expenditures necessary to fund future operations. The assumptions in the fair value measurement reflect the current market environment, industry-specific factors and company-specific factors.