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Goodwill and Other Intangible Assets
 12 Months Ended
May 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets

NOTE 4: GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL. The carrying amount of goodwill attributable to each reportable operating segment and changes therein are as follows (in millions):

 

 

FedEx Express
Segment

 

 

FedEx Ground
Segment

 

 

FedEx Freight
Segment

 

 

Corporate, Other, and Eliminations

 

 

Total

 

Goodwill at May 31, 2021

 

$

5,358

 

 

$

943

 

 

$

767

 

 

$

1,966

 

 

$

9,034

 

Accumulated impairment charges

 

 

—

 

 

 

—

 

 

 

(133

)

 

 

(1,909

)

 

 

(2,042

)

Balance as of May 31, 2021

 

 

5,358

 

 

 

943

 

 

 

634

 

 

 

57

 

 

 

6,992

 

Other(1)

 

 

(433

)

 

 

(11

)

 

 

—

 

 

 

(4

)

 

 

(448

)

Balance as of May 31, 2022

 

 

4,925

 

 

 

932

 

 

 

634

 

 

 

53

 

 

 

6,544

 

Impairment charges

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(36

)

 

 

(36

)

Other(1)

 

 

(72

)

 

 

—

 

 

 

—

 

 

 

(1

)

 

 

(73

)

Balance as of May 31, 2023

 

$

4,853

 

 

$

932

 

 

$

634

 

 

$

16

 

 

$

6,435

 

Accumulated goodwill impairment
   charges as of May 31, 2023

 

$

—

 

 

$

—

 

 

$

(133

)

 

$

(1,945

)

 

$

(2,078

)

 

(1)
Primarily currency translation adjustments and purchase price allocation-related adjustments.

In connection with our annual impairment testing of goodwill conducted in the fourth quarter of 2023, we recorded an impairment charge of $36 million for all of the goodwill attributable to our FedEx Dataworks, Inc. (“FedEx Dataworks”) reporting unit. The key factors contributing to the goodwill impairment were underperformance of the ShopRunner business during 2023, including base business erosion, and the failure to attain the level of operating synergies and revenue and profit growth anticipated at the time of acquisition. Based on these factors, our outlook for the business changed in the fourth quarter of 2023.

Our other reporting units with significant recorded goodwill include FedEx Express, FedEx Ground, and FedEx Freight. We evaluated these reporting units during the fourth quarters of 2023 and 2022 and the estimated fair value of each of these reporting units exceeded their carrying values as of the end of 2023 and 2022; therefore, we do not believe that any of these reporting units were impaired as of the balance sheet dates.

OTHER INTANGIBLE ASSETS. The summary of our intangible assets and related accumulated amortization at May 31, 2023 and 2022 is as follows (in millions):

 

 

2023

 

 

2022

 

 

 

Gross
Carrying
Amount

 

 

Accumulated
Amortization

 

 

Net Book
Value

 

 

Gross
Carrying
Amount

 

 

Accumulated
Amortization

 

 

Net Book
Value

 

Customer relationships

 

$

583

 

 

$

(369

)

 

$

214

 

 

$

617

 

 

$

(340

)

 

$

277

 

Technology

 

 

62

 

 

 

(42

)

 

 

20

 

 

 

64

 

 

 

(40

)

 

 

24

 

Trademarks and other

 

 

1

 

 

 

(1

)

 

 

—

 

 

 

1

 

 

 

(1

)

 

 

—

 

Total

 

$

646

 

 

$

(412

)

 

$

234

 

 

$

682

 

 

$

(381

)

 

$

301

 

 

During the fourth quarter of 2023, we reviewed long-lived assets at FedEx Dataworks for impairment. Based on our reviews, we recognized an $11 million asset impairment charge related to customer relationships from the ShopRunner acquisition.

Amortization expense for intangible assets was $52 million in 2023, $52 million in 2022, and $49 million in 2021.

Expected amortization expense for the next five years is as follows (in millions):

2024

$

47

 

2025

 

46

 

2026

 

46

 

2027

 

44

 

2028

 

42