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Goodwill and Intangible Assets | 6 Months Ended
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Jun. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill Goodwill is tested for impairment at least annually or when certain events or indicators of impairment occur between annual impairment tests. During the three months ended June 30, 2024, in consideration of the sustained decline in our stock price, industry developments, and our financial performance, we evaluated our current operating performance. Accordingly, we determined that there were indicators of impairment and a quantitative assessment was necessary. In the quantitative assessment, we estimated the fair value of our reporting unit utilizing an income approach, based on the present value of future discounted cash flows, which is classified as Level 3 in the fair value hierarchy. Significant estimates used to determine fair value include the weighted average cost of capital, growth rates, and amount and timing of expected future cash flows. As a result of the quantitative assessment, we determined that goodwill was impaired as the fair value of our reporting unit was less than the carrying value. As such, during the three months ended June 30, 2024, we recorded a $439.7 million impairment expense equal to the excess of the carrying value of our reporting unit over the estimated fair value, which was classified as impairment expense on our condensed consolidated statements of operations. The following table presents our goodwill balances (in thousands):
| Six Months Ended June 30, 2024 |  | Year Ended December 31, 2023
Beginning balance | $ | 631,995 |  |  | $ | 615,093 |
Impairment expense | (439,683) |  |  | — |
Foreign currency translation adjustment | (2,543) |  |  | 16,902 |
Ending balance | $ | 189,769 |  |  | $ | 631,995 |
Intangible Assets Intangible assets are tested for impairment at the asset group level at least annually or when events or changes in circumstances indicate that the carrying amount of such asset groups may not be recoverable. In conjunction with our goodwill impairment analysis in June 2024, we determined that there were indicators of impairment for our Busuu assets and a recoverability test was necessary. In the recoverability test, we determined that the expected future undiscounted cash flows for the asset group were not sufficient to recover the carrying value. We then proceeded in estimating the fair value of the asset group utilizing the income approach, based on a present value of future discounted cash flows, which is classified as Level 3 in the fair value hierarchy. Significant estimates used to determine fair value include the growth rates and amount and timing of expected future cash flows. As a result of the impairment test, we determined the asset group was impaired and recorded a $31.9 million impairment expense related to the intangible assets during the three months ended June 30, 2024, which was classified as impairment expense on our condensed consolidated statements of operations. We also recorded an impairment expense for property and equipment, net. For further information, see “Note 5, Property and Equipment, Net.” The following tables present our intangible assets balances as of June 30, 2024 and December 31, 2023 (in thousands, except weighted-average amortization period):
| June 30, 2024
| Weighted-Average Amortization Period (in months) |  | Gross Carrying Amount |  | Accumulated Amortization |  | Accumulated Impairment |  | Foreign Currency Translation Adjustment |  | Net Carrying Amount
Developed technologies | 80 |  | $ | 106,703 |  |  | $ | (61,167) |  |  | $ | (29,369) |  |  | $ | (3,958) |  |  | $ | 12,209 |
Content libraries | 60 |  | 12,230 |  |  | (11,883) |  |  | — |  |  | — |  |  | 347 |
Customer lists | 35 |  | 34,190 |  |  | (32,774) |  |  | — |  |  | (1,298) |  |  | 118 |
Trade and domain names | 52 |  | 16,213 |  |  | (13,169) |  |  | (2,493) |  |  | (377) |  |  | 174 |
Total intangible assets | 67 |  | $ | 169,336 |  |  | $ | (118,993) |  |  | $ | (31,862) |  |  | $ | (5,633) |  |  | $ | 12,848 |
| December 31, 2023
| Weighted-Average Amortization Period (in months) |  | Gross Carrying Amount |  | Accumulated Amortization |  | Accumulated Impairment |  | Foreign Currency Translation Adjustment |  | Net Carrying Amount
Developed technologies | 80 |  | $ | 106,703 |  |  | $ | (55,651) |  |  | $ | — |  |  | $ | (3,757) |  |  | $ | 47,295 |
Content libraries | 60 |  | 12,230 |  |  | (11,189) |  |  | — |  |  | — |  |  | 1,041 |
Customer lists | 35 |  | 34,190 |  |  | (31,836) |  |  | — |  |  | (1,298) |  |  | 1,056 |
Trade and domain names | 52 |  | 16,213 |  |  | (12,817) |  |  | — |  |  | (358) |  |  | 3,038 |
Total intangible assets | 67 |  | $ | 169,336 |  |  | $ | (111,493) |  |  | $ | — |  |  | $ | (5,413) |  |  | $ | 52,430 |
During the three and six months ended June 30, 2024, amortization expense related to our intangible assets totaled $3.5 million and $7.5 million, respectively. During the three and six months ended June 30, 2023, amortization expense related to our intangible assets totaled $6.4 million and $12.6 million, respectively. We did not recognize any impairment expenses on any of our other intangible assets during the three and six months ended June 30, 2023. The following table presents the estimated future amortization expense related to our intangible assets as of June 30, 2024 (in thousands):
| June 30, 2024
Remaining six months of 2024 | $ | 2,460 |
2025 | 4,240 |
2026 | 3,897 |
2027 | 1,776 |
2028 | 407 |
Thereafter | 68 |
Total | $ | 12,848 |

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- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-30/tableOfContent Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 350 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/350-20/tableOfContent + Details
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