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Note 8 - Goodwill and Intangible Assets

3 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Text Block]

8. GOODWILL AND INTANGIBLE ASSETS

Goodwill is attributable to the acquisitions of Genasys Spain and Zonehaven, and the Amika Mobile asset purchase and is due to combining the integrated emergency critical communications, mass messaging solutions and software development capabilities with existing hardware products for enhanced offerings and the skill level of the acquired workforces. The Company periodically reviews goodwill for impairment in accordance with relevant accounting standards. In the fourth quarter of fiscal 2022, in conjunction with the annual impairment assessment, the Company determined that the fair value of the software reporting unit was less than the carrying value. The Company engaged independent valuation experts to assist in determining the fair value of the software reporting unit and recorded a $13,162 goodwill impairment charge. As of December 31, 2022 and September 30, 2022, goodwill was $10,308 and $10,118 respectively. There were no additions or impairments to goodwill during the three months ended December 31, 2022.

The changes in the carrying amount of goodwill by segment for the three months ended December 31, 2022, were as follows:

	Hardware		Software		Total
Balance as of September 30, 2022	$	-	$	10,118	$	10,118
Currency translation		-		190		190
Balance as of December 31, 2022	$	-	$	10,308	$	10,308

Intangible assets and goodwill related to Genasys Spain are translated from Euros to U.S. dollars at the balance sheet date. The net impact of foreign currency exchange differences arising during the period related to goodwill and intangible assets was an increase of $221.

The changes in the carrying amount of intangible assets by segment for the three months ended December 31, 2022, were as follows:

	Hardware			Software			Total
Balance as of September 30, 2022	$	21		$	10,484		$	10,505
Amortization		(1	)		(531	)		(532	)
Currency translation		-			31			31
Balance as of December 31, 2022	$	20		$	9,984		$	10,004

The Company’s consolidated intangible assets consisted of the following:

	December 31,			September 30,
	2022			2022
Technology	$	11,937		$	11,886
Customer relationships		1,762			1,715
Trade name portfolio		608			590
Non-compete agreements		225			206
Patents		72			72
		14,604			14,469
Accumulated amortization		(4,600	)		(3,964	)
	$	10,004		$	10,505

As of December 31, 2022, future amortization expense is as follows:

Fiscal year ending September 30,
2023 (remaining nine months)		1,574
2024		2,097
2025		1,978
2026		1,843
2027		1,669
Thereafter		843
Total estimated amortization expense	$	10,004

Amortization expense was $532 and $543 for the three months ended December 31, 2022 and 2021, respectively.