XML 26 R15.htm IDEA: XBRL DOCUMENT v3.20.2
Intangible Assets, Goodwill and Other Assets
 6 Months Ended
Jun. 30, 2020
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets, Goodwill and Other Assets Intangible Assets, Goodwill and Other Assets
Intangible Assets
Intangible assets consisted of the following:
 
June 30, 2020
 
December 31, 2019
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
Customer relationships
$
268,178

 
$
(101,688
)
 
$
166,490

 
$
265,665

 
$
(88,550
)
 
$
177,115

Software & technology
31,600

 
(23,012
)
 
8,588

 
31,600

 
(19,999
)
 
11,601

Trademarks & other
13,324

 
(12,942
)
 
382

 
13,324

 
(11,400
)
 
1,924

Total intangible assets
$
313,102

 
$
(137,642
)
 
$
175,460

 
$
310,589

 
$
(119,949
)
 
$
190,640



Amortization expense was $9 million for both the three months ended June 30, 2020 and 2019, and $18 million for both the six months ended June 30, 2020 and 2019.
Future amortization expense as of June 30, 2020 is shown in the table below. Actual amortization expense may differ due to, among other things, fluctuations in foreign currency exchange rates, impairments, acquisitions and accelerated amortization.
Remaining for year ending December 31, 2020
$
15,699

Year ending December 31, 2021
30,227

Year ending December 31, 2022
29,281

Year ending December 31, 2023
26,443

Year ending December 31, 2024
26,443

Thereafter
47,367

Total
$
175,460



Goodwill
Changes in the carrying value of goodwill, by reporting segment, are shown in the table below.
 
December 31, 2019
 
Impairment
 
Acquisition
 
Currency impact
 
June 30,
2020
Global Ecommerce
$
609,431

 
$
(198,169
)
 
$
—

 
$
—

 
$
411,262

Presort Services
212,529

 
—

 
8,463

 
—

 
220,992

Commerce Services
821,960

 
(198,169
)
 
8,463

 
—

 
632,254

SendTech Solutions
502,219

 
—

 
—

 
(1,688
)
 
500,531

Total goodwill
$
1,324,179

 
$
(198,169
)
 
$
8,463

 
$
(1,688
)
 
$
1,132,785



During the first quarter of 2020, our Global Ecommerce reporting unit experienced weaker than expected performance, in part due to the macroeconomic conditions resulting from COVID-19. At December 31, 2019, the fair value of our Global Ecommerce business exceeded its carrying value by less than 20%, and the deteriorating macroeconomic conditions and uncertainty brought on by COVID-19 caused us to evaluate the Global Ecommerce goodwill for impairment.
To test the Global Ecommerce goodwill for impairment, we determined the fair value of the Global Ecommerce reporting unit and compared it to the reporting unit's carrying value, including goodwill. We engaged a third-party to assist in the determination of the fair value of the reporting unit. The determination of fair value, and the resulting impairment charge, relied on internal projections developed using numerous estimates and assumptions that are inherently subject to significant uncertainties. These estimates and assumptions included revenue growth, profitability, cash flows, capital spending and other available information. The determination of fair value also incorporated a risk-adjusted discount rate, terminal growth rates and other assumptions that market participants may use. Changes in any of these estimates or assumptions could materially affect the determination of fair value and the associated goodwill impairment charge and could result in an additional impairment charge in the future. These estimates and assumptions are considered Level 3 inputs under the fair value hierarchy.
We determined that the reporting unit's estimated fair value was less than its carrying value and recorded a non-cash, pre-tax goodwill impairment charge of $198 million in the first quarter to reduce the carrying value of the Global Ecommerce reporting unit to its estimated fair value.

Other Assets
During the second quarter of 2020, we surrendered certain company owned life insurance policies and received proceeds of $46 million. We did not record a gain or loss on the surrender; however, the surrender resulted in a tax expense of $12 million (see Note 13 for further information). Also, during the second quarter of 2020, we sold our interest in an equity investment for $12 million and recognized a gain of $12 million.