Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2016

Goodwill And Intangible Assets Disclosure [Abstract]

6. Goodwill and Other Intangible Assets

Changes in the carrying value of goodwill from December 31, 2015 to September 30, 2016 are as follows (in thousands):

Goodwill – December 31, 2015	$	657,671
Additions		23,191
Foreign currency translation and other adjustments ⁽¹⁾		(46,949	)
Goodwill – September 30, 2016	$	633,913

⁽¹⁾

The decrease is primarily related to cumulative translation losses on goodwill associated with the acquisition of NaturalMotion denominated in British Pounds. Includes the impact of adjustments to goodwill resulting from changes in net assets (liabilities) acquired (assumed) and other adjustments, pursuant to our business combinations policy.

The details of our acquisition-related intangible assets as of September 30, 2016 are as follows (in thousands):

	September 30, 2016
	Gross Carrying Value		Accumulated Amortization			Net Book Value
Developed technology	$	154,301	$	(128,985	)	$	25,316
Trademarks, branding and domain names		16,290		(9,895	)		6,395
Acquired lease intangibles		5,708		(5,110	)		598
Total	$	176,299	$	(143,990	)	$	32,309

Our updated financial forecast as of September 30, 2016, indicated a reduction of future undiscounted cash flows for certain games associated with developed technology previously acquired from Rising Tide and Zindagi. As a result, we performed an impairment analysis and determined the estimated fair values of Rising Tide’s and Zindagi’s intangible assets to be $18.2 million and $2.4 million lower, respectively, than their carrying values as of September 30, 2016. Accordingly, we recorded this amount as an impairment charge in our consolidated statements of operations.

The details of our acquisition-related intangible assets as of December 31, 2015 are as follows (in thousands):

	December 31, 2015
	Gross Carrying Value		Accumulated Amortization			Net Book Value
Developed technology	$	174,970	$	(118,940	)	$	56,030
Trademarks, branding and domain names		16,290		(9,210	)		7,080
Acquired lease intangibles		5,708		(4,802	)		906
Total	$	196,968	$	(132,952	)	$	64,016

These assets include $6.1 million of indefinite-lived intangible assets. The remaining assets were, and continue to be, amortized on a straight-line basis.

As of September 30, 2016, future amortization expense related to the intangible assets is expected to be recognized as shown below (in thousands):

Year ending December 31:
2016	$	6,483
2017		9,994
2018		4,550
2019 and thereafter		5,162
Total	$	26,189

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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