Goodwill and Intangible Assets

9 Months Ended

Oct. 01, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

Goodwill

On October 4, 2021, we entered into a Securities Purchase Agreement to acquire all of the issued and outstanding membership interests of Blue Raven Solar Holdings, LLC (“Blue Raven”) and 35% of the issued and outstanding membership interests in Albatross Software, LLC, an affiliate of Blue Raven. Goodwill presented on our condensed consolidated financial statements represents goodwill resulting from the acquisition of Blue Raven.

We test goodwill impairment at least annually during the last day of the third fiscal quarter, or when events or changes in circumstances indicate that goodwill might be impaired. The evaluation of impairment involves comparing the current fair value of our reporting unit to the book value (including goodwill). We have performed a qualitative assessment of goodwill prior to completing a quantitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. After assessing the totality of events and circumstances, we concluded that as of October 1, 2023, the date our last qualitative test was performed, it was more likely than not that the fair value of our reporting unit with goodwill was greater than the book value and, therefore, that there is no goodwill impairment.

Other Intangible Assets

The following table represents our other intangible assets with finite useful lives:


(In thousands)	Gross Carrying Amount		Accumulated Amortization		Net Book Value
As of October 1, 2023:
Developed technology	$	3,700	$	(2,467)	$	1,233
Brand	15,800		(7,900)		7,900
Non-compete agreements	3,400		(2,267)		1,133
Software development costs	13,840		(4,276)		9,564
Total	$	36,740	$	(16,910)	$	19,830

As of January 1, 2023:
Developed technology	$	3,700	$	(1,542)	$	2,158
Brand	15,800		(4,937)		10,863
Non-compete agreements	3,400		(1,417)		1,983
Software development costs	9,250		(62)		9,188
Total	$	32,150	$	(7,958)	$	24,192

Aggregate amortization expense for intangible assets was $3.2 million and $9.0 million for the three and nine months ended October 1, 2023, and $1.6 million and $4.8 million for the three and nine months ended October 2, 2022, respectively. No impairment loss was recorded for intangible assets for the three and nine months ended October 1, 2023 and October 2, 2022.

As of October 1, 2023, the estimated future amortization expense related to intangible assets with finite useful lives for each of the next three fiscal years was as follows, through the end of the useful life of all intangible assets:


	Expected Amortization Expense
Fiscal Year	(In thousands)
2023 (remaining three months)	$	3,181
2024	10,871
2025	5,778

Total	$	19,830