Goodwill and Other Intangible Assets, net

9 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets, net

3.	Goodwill and Other Intangible Assets, net

Goodwill of $8.4 million related to our IT Staffing Services segment resulted from the 2015 acquisition of Hudson Global Resources Management’s U.S. IT staffing business. Goodwill related to our Data and Analytics Services segment includes our 2017 acquisition of the services division of InfoTrellis, which totaled $27.4 million, and our 2020 acquisition of AmberLeaf, which totaled $6.4 million. The Company recorded a $5.3 million goodwill impairment related to the Data and Analytics Services segment in 2023 and a $9.7 million goodwill impairment in 2018. The impairments were primarily attributable to declines in revenue levels and lower future revenue projections.

A reconciliation of the beginning and ending amounts of goodwill by operating segment for the periods ended September 30, 2024 and December 31, 2023 is as follows:


	Nine Months Ended		Twelve Months Ended
	September 30, 2024		December 31, 2023
	(in thousands)
IT Staffing Services:
Beginning balance	$	8,427	$	8,427
Goodwill recorded		—		—
Impairment		—		—

Ending Balance	$	8,427	$	8,427


	Nine Months Ended		Twelve Months Ended
	September 30, 2024		December 31, 2023
	(in thousands)
Data and Analytics Services:
Beginning balance	$	18,783	$	24,083
Goodwill recorded		—		—
Impairment		—		(5,300	)

Ending Balance	$	18,783	$	18,783

The Company is amortizing the identifiable intangible assets on a straight-line basis over estimated average lives ranging from 3 to 12 years. Identifiable intangible assets were comprised of the following as of September 30, 2024 and December 31, 2023:


	As of September 30, 2024
(Amounts in thousands)	Amortization Period (In Years)		Gross Carrying Value		Accumulative Amortization		Net Carrying Value
IT Staffing Services:
Client relationships		12	$	7,999	$	6,194	$	1,805
Covenant-not-to-compete		5		319		319		—
Trade name		3		249		249		—
Data and Analytics Services:
Client relationships		12		19,641		11,003		8,638
Covenant-not-to-compete		5		1,201		1,113		88
Trade name		5		1,711		1,613		98
Technology		7		1,979		1,650		329

Total Intangible Assets			$	33,099	$	22,141	$	10,958


	As of December 31, 2023
(Amounts in thousands)	Amortization Period (In Years)		Gross Carrying Value		Accumulative Amortization		Net Carrying Value
IT Staffing Services:
Client relationships		12	$	7,999	$	5,694	$	2,305
Covenant-not-to-compete		5		319		319		—
Trade name		3		249		249		—
Data and Analytics Services:
Client relationships		12		19,641		9,776		9,865
Covenant-not-to-compete		5		1,201		1,047		154
Trade name		5		1,711		1,539		172
Technology		7		1,979		1,474		505

Total Intangible Assets			$	33,099	$	20,098	$	13,001

Amortization expense for the three and nine month periods ended September 30, 2024 and 2023 totaled $657,000 and $2.0 million, respectively and is included in selling, general and administrative expenses in the Consolidated Statement of Operations. For the three and nine month periods ended September 30, 2023 amortization expense was $693,000 and $2.1 million, respectively.

The estimated aggregate amortization expense for intangible assets for the years ending December 31, 2024 through 2028 is as follows:


	Years Ended December 31,
	2024		2025		2026		2027		2028
	(Amounts in thousands)
Amortization expense	$	2,693	$	2,553	$	2,413	$	2,025	$	1,637