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Intangible Assets and Goodwill
12 Months Ended
Dec. 31, 2024
Intangible Assets and Goodwill  
Intangible Assets and Goodwill

7. Intangible Assets and Goodwill

The following table provides the components of the Company’s intangible assets (in thousands, except weighted average amortization period in years):

Weighted

    

    

    

    

    

    

Average

As of December 31, 2024

As of December 31, 2023

Amortization

Initial

Accumulated

Net

Initial

Accumulated

Net

Period

Cost

Amortization

Balance

Cost

Amortization

Balance

Franchise agreements

11.9

$

222,055

$

(140,869)

$

81,186

$

225,716

$

(124,200)

$

101,516

Other intangible assets:

Software (a)

3.8

$

57,243

$

(46,829)

$

10,414

$

52,918

$

(39,192)

$

13,726

Trademarks

9.0

900

(684)

216

971

(649)

322

Non-compete agreements

5.0

12,721

(9,969)

2,752

13,051

(8,156)

4,895

Training materials

2,400

(2,400)

2,400

(2,400)

Other

7.0

870

(870)

870

(637)

233

Total other intangible assets

4.3

$

74,134

$

(60,752)

$

13,382

$

70,210

$

(51,034)

$

19,176

(a)As of December 31, 2024 and 2023, capitalized software development costs of $1.2 million and $1.0 million, respectively, were related to technology projects not yet complete and ready for their intended use and thus were not subject to amortization.

Amortization expense was $27.2 million, $29.9 million and $33.4 million for the years ended December 31, 2024, 2023 and 2022, respectively.

As of December 31, 2024, the estimated future amortization expense related to intangible assets includes the estimated amortization expense associated with the Company’s intangible assets assumed with the Company’s acquisitions (in thousands):

2025

$

23,135

2026

16,770

2027

9,685

2028

8,258

2029

6,983

Thereafter

29,737

$

94,568

The following table presents changes to goodwill by reportable segment for the period from January 1, 2023 to December 31, 2024 (in thousands):

Real Estate

Mortgage

Total

Balance, January 1, 2023

$

239,993

$

18,633

$

258,626

Impairment charge

(18,633)

(18,633)

Effect of changes in foreign currency exchange rates

1,171

1,171

Balance, January 1, 2024

$

241,164

$

$

241,164

Effect of changes in foreign currency exchange rates

(3,925)

(3,925)

Balance, December 31, 2024

$

237,239

$

$

237,239

Impairment charge - goodwill

The Company assesses goodwill for impairment at least annually or whenever an event occurs, or circumstances change that would indicate impairment may have occurred at the reporting unit level. Reporting units are driven by the level at which segment management reviews operating results.

During the fourth quarter of 2023, the Company tested and identified impairment indicators associated with the Mortgage reporting unit in the Mortgage Segment, primarily due to a decline in projected net cash flows resulting from continued macroeconomic pressures and revised franchise sales forecasts. Therefore, the Company fully impaired the reporting unit’s goodwill and recorded a non-cash impairment charge of $18.6 million in “Settlement and impairment charges” in the Consolidated Statements of Income (Loss).

During the fourth quarter of 2022, in connection with the strategic shift and restructuring of its business, the Company made the decision to wind down the Gadberry Group reporting unit in the Real Estate segment. Therefore, the Company fully impaired the Gadberry Group reporting unit goodwill and recorded a non-cash impairment charge of $7.1 million, in “Settlement and impairment charges” in the Consolidated Statements of Income (Loss).