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Business Combination (Tables) | 9 Months Ended
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Sep. 30, 2022
Business Combinations [Abstract] |
Summary of Purchase Price for Business Combination | The following table summarizes the purchase price for the ADVA business combination:
(In thousands, except shares, share price and exchange ratio) |  | Purchase Price |
ADVA shares exchanged |  |  | 33,957,538 |
Exchange ratio |  |  | 0.8244 |
ADTRAN Holdings, Inc. shares issued |  |  | 27,994,595 |
ADTRAN Holdings, Inc. share price on July 15, 2022 |  | $ | 20.20 |
Purchase price paid for ADVA shares |  | $ | 565,491 |
Equity compensation (1) |  | $ | 12,769 |
Total purchase price |  | $ | 578,260 |
(1) Represents the portion of replacement share-based payment awards that relates to pre-combination vesting.
Summary of Purchase Price Allocation of Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary purchase price allocation for each major class of assets acquired and liabilities assumed in the acquisition of ADVA (in thousands):
(In thousands) |  |  |
Total purchase price |  | $ | 578,260 |
Non-controlling interest |  | $ | 316,415 |
Net Assets: |  |  |
Cash and cash equivalents |  | $ | 44,003 |
Accounts receivable |  |  | 114,659 |
Other receivables |  |  | 1,457 |
Inventory |  |  | 200,532 |
Prepaid expenses and other current assets |  |  | 29,474 |
Property plant and equipment |  |  | 52,796 |
Deferred tax assets |  |  | 1,599 |
Intangibles |  |  | 405,385 |
Other non-current assets |  |  | 30,588 |
Accounts payable |  |  | (98,587 | )
Current unearned revenue |  |  | (26,047 | )
Accrued expenses and other liabilities |  |  | (59,600 | )
Current portion of notes payable |  |  | (25,254 | )
Income tax payable |  |  | (1,400 | )
Non-current unearned revenue |  |  | (11,498 | )
Pension liability |  |  | (6,820 | )
Other non-current liabilities |  |  | (6,094 | )
Non-current portion of revolving credit agreements and notes payable |  |  | (15,250 | )
Non-current lease obligations |  |  | (20,046 | )
Deferred tax liabilities |  |  | (74,379 | )
Total net assets acquired |  | $ | 535,518 |
Goodwill |  | $ | 359,157 |
Summary of Fair Value of Intangible Assets Acquired | The fair value of the intangible assets acquired as of the acquisition date:
(In thousands) | Estimated-average useful life (in years) (1) |  |  | Fair value |  |  | Income Statement Amortization Classification
Developed technology |  | 8.5 |  |  | $ | 293,530 |  |  | Cost of revenue - Network Solutions
Backlog |  | 1.4 |  |  |  | 52,165 |  |  | Cost of revenue - Network Solutions and Services & Support
Customer relationships |  | 10.5 |  |  |  | 32,704 |  |  | Selling, general and administrative expenses
Trade name |  | 2.8 |  |  |  | 26,986 |  |  | Selling, general and administrative expenses
Total |  |  |  | $ | 405,385 |  |  |
(1) Determination of the weighted average period of the individual categories of intangible assets was based on the nature of the applicable intangible asset and the expected future cash flows to be derived from the intangible asset. Amortization of intangible assets with definite lives is recognized over the period of time the assets are expected to contribute to future cash flows.
Summary of Unaudited Pro Forma Financial Information | The unaudited pro forma financial information in the table below summarizes the combined results of operations for ADTRAN and ADVA as though the Business Combination had occurred on January 1, 2021.
| Three Months Ended |  |  | Nine Months Ended |
| September 30, |  |  | September 30, |
(In thousands) | 2022 |  |  | 2021 |  |  | 2022 |  |  | 2021 |
Revenue | $ | 368,192 |  |  | $ | 317,067 |  |  | $ | 1,053,510 |  |  | $ | 942,003 |
Net income (loss) | $ | (48,084 | ) |  | $ | (44,154 | ) |  | $ | (60,494 | ) |  | $ | (133,321 | )

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