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Goodwill and Intangible Assets, Net
 9 Months Ended
Sep. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets, Net Goodwill and Intangible Assets, Net
Goodwill

During the nine months ended September 30, 2023, a decline in our financial performance, overall negative trend in the video service provider channel and an uncertain economic environment contributed to a significant decline in our market capitalization. We considered this to be an impairment trigger. We, therefore, performed a quantitative valuation analysis under an income approach to estimate our reporting unit's fair value. The income approach used projections of estimated operating results and cash flows that were discounted using a discount rate based on the weighted-average cost of capital. The main assumptions supporting the cash flow projections include, but are not limited to, revenue growth, margins, discount rate, and terminal growth rate. The financial projections reflect our best estimate of economic and market conditions over the projected period, including forecasted revenue growth, margins, capital expenditures, depreciation and amortization. In addition to our valuation analysis under an income approach, we also considered the implied control premium compared to our market capitalization. We determined that the implied control premium over our market capitalization to be substantial; therefore, we recorded an impairment charge of $49.1 million during the nine months ended September 30, 2023.

Intangible Assets, Net

The components of intangible assets, net were as follows:
 September 30, 2024December 31, 2023
(In thousands)
Gross (1)
Accumulated
Amortization (1)
Net
Gross (1)
Accumulated
Amortization (1)
Net
Capitalized software development costs$2,511 $(909)$1,602 $2,161 $(421)$1,740 
Customer relationships 6,340 (4,346)1,994 6,340 (3,803)2,537 
Developed and core technology 740 (374)366 4,220 (3,754)466 
Patents34,547 (13,888)20,659 33,195 (12,686)20,509 
Trademarks and trade names450 (397)53 450 (353)97 
Total intangible assets, net$44,588 $(19,914)$24,674 $46,366 $(21,017)$25,349 
(1)This table excludes the gross value of fully amortized intangible assets totaling $49.3 million and $45.0 million at September 30, 2024 and December 31, 2023, respectively.
Amortization expense is recorded in selling, general and administrative expenses, except amortization expense related to capitalized software development costs, which is recorded in cost of sales. Amortization expense by statement of operations caption was as follows:
(In thousands)Three Months Ended September 30,Nine Months Ended September 30,
2024202320242023
Cost of sales$207 $146 $488 $302 
Selling, general and administrative expenses1,160 1,119 3,336 3,282 
Total amortization expense$1,367 $1,265 $3,824 $3,584 
 
Estimated future annual amortization expense related to our intangible assets at September 30, 2024, was as follows:
(In thousands)
2024 (remaining 3 months)$1,369 
20254,984 
20264,420 
20273,401 
20282,780 
Thereafter7,720 
Total$24,674