Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Note 7 — Goodwill and Intangible Assets

Goodwill represents the future economic benefits arising from assets acquired in a business combination that are not individually identified and separately recognized. There were no changes in goodwill balances during the years ended December 31, 2021 or 2020, while the below table reflects the gross carrying amounts and accumulated impairments as of the respective periods:

	Gross carrying		Accumulated
	amount		impairment		Net amount
	(in thousands)
Balance at December 31, 2021 and 2020	$	430,331	$	248,388	$	181,943

The Company performs its annual goodwill impairment test at the beginning of the fourth quarter each year. As the Company maintains a single goodwill reporting unit, it determines the fair value of its reporting unit based upon the Company’s adjusted market capitalization. The annual test performed at the beginning of the fourth quarter of fiscal 2021, 2020, and 2019 did not result in any potential impairment as the fair value of the reporting unit was determined to exceed the carrying amount of the reporting unit.

The valuation of goodwill will continue to be subject to changes in the Company’s market capitalization and observable market control premiums. This analysis is sensitive to changes in the Company’s stock price and absent other qualitative factors, the Company may be required to record goodwill impairment charges in future periods if the stock price declines and remains depressed for an extended period of time. 

The components of purchased intangible assets were as follows:

		December 31, 2021						December 31, 2020
	Average			Accumulated						Accumulated
	Remaining	Gross		Amortization				Gross		Amortization
	Amortization	Carrying		and		Net		Carrying		and		Net
	Period	Amount		Impairment		Amount		Amount		Impairment		Amount
	(in years)	(in thousands)
Technology	3.6	$	327,908	$	310,551	$	17,357	$	327,908	$	302,358	$	25,550
Customer relationships	7.3		146,465		132,970		13,495		146,465		130,131		16,334
Trademarks and tradenames	2.5		30,910		27,857		3,053		30,910		26,614		4,296
Other	-		3,686		3,686		—		3,686		3,681		5
Total	5.0	$	508,969	$	475,064	$	33,905	$	508,969	$	462,784	$	46,185

Other intangible assets primarily consist of patents, licenses, and backlog.

Based on the intangible assets recorded at December 31, 2021, and assuming no subsequent additions to or impairment of the underlying assets, the remaining estimated annual amortization expense, is expected to be as follows:

	Amortization
	(in thousands)
2022	$	10,018
2023		8,347
2024		6,708
2025		3,136
2026		2,134
Thereafter		3,562
Total	$	33,905