GOODWILL & INTANGIBLE ASSETS

12 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The Company has one reporting unit. Goodwill is tested for impairment at a reporting unit level at least annually, as of January 31, or on an interim basis if an event occurs or circumstances change that would, more likely than not, reduce the fair value of the reporting unit below its carrying value. At March 31, 2023 and 2022, the carrying amount of goodwill was $1.7 billion.

During fiscal years 2023 and 2022, the Company's annual impairment tests indicated that goodwill was not impaired. The Company completed its annual goodwill impairment test at January 31, 2023, using the qualitative (Step 0) assessment, and the Company concluded that it was more likely than not that the fair value of the reporting unit exceeded its carrying value.

The change in the carrying amount of goodwill for the fiscal year ended March 31, 2023 is due to the impact of foreign currency translation adjustments related to asset balances that are recorded in currencies other than the U.S. Dollar.

The changes in the carrying amount of goodwill for the fiscal years ended March 31, 2023 and 2022 are as follows (in thousands):


Balance at March 31, 2021	$	1,717,554
Foreign currency translation impact	5,602
Balance at March 31, 2022	$	1,723,156
Foreign currency translation impact	1,248
Balance at March 31, 2023	$	1,724,404

Intangible Assets

The net carrying amounts of intangible assets were $366.6 million and $433.4 million at March 31, 2023 and 2022, respectively. Intangible assets acquired in a business combination are recorded under the acquisition method of accounting at their estimated fair values at the date of acquisition. The Company amortizes intangible assets over their estimated useful lives. During the first quarter of fiscal year 2022, in conjunction with the renewal process of an acquired indefinite-lived trade name and the Company's focus on advancing new product lines, the Company reassessed the estimated economic life of the acquired indefinite-lived trade name. As a result, the Company began amortizing the acquired trade name over 8 years. Prior to reclassifying the acquired trade name to a finite-lived intangible asset, the Company tested the acquired trade name for impairment and determined the fair value of the asset exceeded the carrying value. This change in estimate did not materially impact the Company's income statement.

During the fiscal years ended March 31, 2023, 2022 and 2021, the Company acquired $0.2 million, $50 thousand, and $4.5 million of technology licenses, respectively. These amounts are included within distributor relationships and are being amortizing using the economic benefit method over useful lives of between one and four years.

Intangible assets include the following amortizable intangible assets at March 31, 2023 (in thousands):


	Estimated Useful Life in Years	Cost		Accumulated Amortization		Net
Developed technology	3 - 13 years	$	249,903	$	(233,440)	$	16,463
Customer relationships	8 - 18 years	768,179		(433,876)		334,303
Distributor relationships and technology licenses	1 - 6 years	11,547		(10,133)		1,414
Definite-lived trademark and trade name	2 - 9 years	57,694		(43,489)		14,205
Core technology	10 years	7,192		(7,192)		—

Non-compete agreements	3 years	292		(292)		—


Capitalized software	3 years	3,317		(3,317)		—
Other	1 - 20 years	1,208		(1,002)		206
		$	1,099,332	$	(732,741)	$	366,591

Intangible assets include the following amortizable intangible assets at March 31, 2022 (in thousands):


	Estimated Useful Life in Years	Cost		Accumulated Amortization		Net
Developed technology	3 - 13 years	$	250,247	$	(224,426)	$	25,821
Customer relationships	8 - 18 years	769,404		(384,347)		385,057
Distributor relationships and technology licenses	1 - 6 years	11,408		(8,896)		2,512
Definite-lived trademark and trade name (a)	2 - 9 years	57,748		(37,944)		19,804
Core technology	10 years	7,192		(7,192)		—

Non-compete agreements	3 years	292		(292)		—


Capitalized software	3 years	3,317		(3,317)		—
Other	1 - 20 years	1,208		(983)		225
		$	1,100,816	$	(667,397)	$	433,419

(a) The Company’s $18.6 million acquired trade name changed from indefinite-lived to definite-lived during the first quarter of fiscal year 2022.

Amortization included as cost of product revenue consists of amortization of developed technology, distributor relationships and technology licenses, core technology and software. Amortization included as operating expense consists of all other intangible assets. The following table provides a summary of amortization expense during the fiscal years ended March 31, 2023, 2022, and 2021 (in thousands).


	Years Ended March 31,
	2023		2022		2021
Amortization of intangible assets included as:

Cost of product revenue	10,542		14,600		20,457
Operating expense	55,410		59,761		61,151
	$	65,952	$	74,361	$	81,608

The following is the expected future amortization expense at March 31, 2023 for the fiscal years ended March 31 (in thousands):


2024	$	57,987
2025	50,809
2026	46,446
2027	43,566
2028	40,608
Thereafter	127,175
Total	$	366,591