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Business Acquisitions | 12 Months Ended
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Mar. 31, 2022
Business Combinations [Abstract] |
Business Acquisitions | Business Acquisitions Fiscal Year 2022 Acquisition On May 19, 2021, the Company made a technology acquisition for a total cash consideration of $25.6 million, including $10.0 million earn-out payable in cash upon the achievement of three technical development milestones required to be completed as of December 31, 2021, June 30, 2022 and June 30, 2023. The acquisition was accounted for using the acquisition method. The Company retained 6% of the total consideration for the purpose of ensuring seller's representations and warranties. See Note 9 for more information on the contingent consideration liabilities related to this acquisition. Fiscal Year 2021 Acquisitions On February 17, 2021, the Company acquired all equity interests of Mevo Inc. ("Mevo") for a total upfront cash consideration of $33.2 million, which included a working capital adjustment, plus additional contingent consideration of up to $17.0 million payable in cash only upon the achievement of certain net revenues for the period beginning on December 26, 2020 and ending on December 31, 2021 (the "Mevo Acquisition"). See Note 9 for more information on the contingent consideration liabilities related to this acquisition. The Mevo Acquisition is complementary to the Company’s PC Webcams portfolio and will better enable the Company to offer end-to-end solutions for streaming and content creation. The acquisition is accounted for using the acquisition method. On January 4, 2021, the Company made a technology acquisition for a total cash consideration of $11.0 million, including $3.0 million earn-out payable in cash upon the achievement of two technical development milestones required to be completed for periods ending December 31, 2021 and March 31, 2022. The acquisition was accounted for using the acquisition method. On February 11, 2021, the Company made a technology acquisition for a total cash consideration of $3.5 million, which was accounted for as an asset acquisition. Fiscal Year 2020 Acquisitions Streamlabs Acquisition On October 31, 2019 (the "Streamlabs Acquisition Date"), the Company acquired all equity interests of Streamlabs for a total consideration of $105.7 million (as described in the table below), which included a working capital adjustment, plus additional contingent consideration of $29.0 million payable in stock only upon the achievement of certain net revenues for the period beginning on January 1, 2020 and ending on June 30, 2020 (the "Streamlabs Acquisition"). Streamlabs is a leading provider of software and tools for professional streamers. The Streamlabs Acquisition is complementary to the Company's Gaming portfolio. Streamlabs met the definition of a business, and therefore the acquisition is accounted for using the acquisition method. The fair value of consideration transferred for the Streamlabs Acquisition consists of the following (in thousands):
|  | Consideration
Purchase price (cash) |  | $ | 105,645 |
Fair value of contingent consideration (earn-out) |  | 37 |
Fair value of total consideration transferred |  | $ | 105,682 |
The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the Streamlabs Acquisition Date, and the value of goodwill resulting from the measurement period adjustments in the three months ending March 31, 2020 (in thousands):
|  | Estimated Fair Value
Cash and cash equivalents |  | $ | 17,014 |
Intangible assets |  | 37,000 |
Other identifiable liabilities assumed, net |  | (3,701) |
Net identifiable assets acquired |  | $ | 50,313 |
Contingent consideration (earn-out) |  | $ | (37) |
Goodwill |  | 55,406 |
Net assets acquired |  | $ | 105,682 |
Goodwill related to the acquisition was primarily attributable to opportunities and economies of scale from combining the operations and technologies of Logitech and Streamlabs, and is not deductible for tax purposes. The following table summarizes the estimated fair values and estimated useful lives of the components of identifiable intangible assets acquired as of the Streamlabs Acquisition Date (Dollars in thousands):
| Fair Value |  | Estimated Useful Life (years)
Developed technology | $ | 21,800 |  |  | 6.0
Customer relationships | 6,000 |  |  | 2.0
Trade name | 9,200 |  |  | 8.0
Total identifiable intangible assets acquired | $ | 37,000 |  |  |
Intangible assets acquired as a result of the Streamlabs Acquisition are being amortized over their estimated useful lives using the straight-line method of amortization, which materially approximates the distribution of the economic value of the identified intangible assets. Developed technology relates to the software platform which existing Streamlabs services are provided on. The economic useful life was determined based on the technology cycle related to developed technology of the software platform, as well as the cash flows anticipated over the forecasted periods. Customer relationships represent the fair value of future projected revenue that will be derived from sales to existing customers of Streamlabs. The economic useful life was determined based on historical customer turnover rates and industry benchmarks. Trade name relates to the “Streamlabs” trade name. The economic useful life was determined based on the expected life of the trade name and the cash flows anticipated over the forecasted periods. The fair value of developed technology was estimated using the excess earnings method, an income approach (Level 3), which converts projected revenues and costs into cash flows. To reflect the fact that certain other assets contributed to the cash flows generated, the returns for these contributory assets were removed to arrive at estimated cash flows solely attributable to the developed technology, which were discounted at a rate of 25%. The fair value of trade name was estimated using the relief-from-royalty method, an income approach (Level 3), which estimates the cost savings that accrue to the owner of the intangible assets that would otherwise be payable as royalties or license fees on revenues earned through the use of the asset. A royalty rate is applied to the projected revenues associated with the intangible assets to determine the amount of savings, which is then discounted to determine the fair value. Trade name was valued using royalty rate of 5% and was discounted at a rate of 25%. The fair value of customer relationships was estimated primarily using the with and without scenario, a discounted cash flow method (Level 3). Under this method, the Company calculated the present value of the after-tax cash flows expected to be generated by the business with and without the customer relationships using a discount rate of 20%. The without scenario incorporates lost revenue and lost profits over the period necessary to retain the asset. The Company believes the fair values of acquired intangible assets recorded above represents their fair values and approximates the amounts a market participant would pay for these intangible assets as of the Streamlabs Acquisition Date. The Company included Streamlabs' estimated fair value of assets acquired and liabilities assumed in its consolidated financial statements beginning on the Streamlabs Acquisition Date. The results of operations for Streamlabs subsequent to the Streamlabs Acquisition Date have been included in, but are not material to, the Company's consolidated statements of operations in fiscal year 2020. On October 31, 2019, the Company also made a technology acquisition for a total cash consideration of $3.6 million, which was accounted for using the acquisition method. Acquisition-related costs and pro forma results of operations The Company incurred acquisition-related costs of approximately $0.8 million, $0.6 million and $1.5 million, in aggregate, for the years ended March 31, 2022, 2021 and 2020, respectively. The acquisition-related costs are included in amortization of intangible assets and acquisition-related costs in the consolidated statements of operations. Pro forma results of operations for acquisitions completed in fiscal year 2022, 2021 and 2020 have not been presented because the effects of these acquisitions, individually or in aggregate, are not material to the consolidated statements of operations for each year.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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