Goodwill and Acquired Intangibles

3 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND ACQUIRED INTANGIBLES

GOODWILL AND ACQUIRED INTANGIBLES

Goodwill

The changes in the carrying amount of goodwill during the three months ended March 31, 2023 were as follows:

	Gross Carrying Amount
	(In thousands)
Balance as of December 31, 2022	$	1,374,268
Effect of foreign currency translation	3,357
Balance as of March 31, 2023	$	1,377,625

Acquired Intangibles, Net

Acquired intangibles as of March 31, 2023 were as follows, excluding intangibles that were fully amortized as of December 31, 2022:

	Gross Carrying Amount		Accumulated Amortization		Acquired Intangibles, Net
	(In thousands)
Existing technology	$	300,259	$	(108,476)	$	191,783
Agreements and relationships	181,995		(48,664)		133,331
Tradenames, trademarks and patents	13,058		(3,234)		9,824
Total acquired intangibles with definite lives	495,312		(160,374)		334,938
In-process technology	6,800		—		6,800
Total acquired intangibles	$	502,112	$	(160,374)	$	341,738

In-process technology as of March 31, 2023 consisted of acquired projects that, if completed, will contribute to Cadence’s existing product offerings. As of March 31, 2023, these projects were expected to be completed during the fourth quarter of fiscal 2023. During the three months ended March 31, 2023, there were no transfers from in-process technology to existing technology.

Acquired intangibles as of December 31, 2022 were as follows, excluding intangibles that were fully amortized as of January 1, 2022:

	Gross Carrying Amount		Accumulated Amortization		Acquired Intangibles, Net
	(In thousands)
Existing technology	$	479,796	$	(278,851)	$	200,945
Agreements and relationships	274,624		(137,847)		136,777
Tradenames, trademarks and patents	12,979		(2,884)		10,095
Total acquired intangibles with definite lives	$	767,399	$	(419,582)	$	347,817
In-process technology	6,800		—		6,800
Total acquired intangibles	$	774,199	$	(419,582)	$	354,617

Amortization expense from existing technology and maintenance agreements is included in cost of product and maintenance. Amortization expense for the three months ended March 31, 2023 and April 2, 2022 by condensed consolidated income statement caption was as follows:

	Three Months Ended
	March 31, 2023		April 2, 2022
	(In thousands)
Cost of product and maintenance	$	10,260	$	11,971
Amortization of acquired intangibles	4,267		4,964
Total amortization of acquired intangibles	$	14,527	$	16,935

As of March 31, 2023, the estimated amortization expense for intangible assets with definite lives was as follows for the following five fiscal years and thereafter:

	(In thousands)
2023 - remaining period	$	44,102
2024	57,059
2025	44,352
2026	38,567
2027	36,113
2028	33,491
Thereafter	81,254
Total estimated amortization expense	$	334,938