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Goodwill and Intangible Assets
 12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets
10. Goodwill and Intangible Assets

Goodwill

As a result of Fresh Start Accounting, we recognized $239 million of goodwill in our Middle East & North Africa (“MENA”) and Russia reporting units. In the Predecessor Period, our goodwill impairment tests indicated that goodwill for all our reporting units in the Western Hemisphere and Eastern Hemisphere were impaired and as a result we incurred a goodwill impairment charge of $730 million. In the fourth quarter of 2018, our annual and interim goodwill impairment tests indicated that our goodwill was impaired and as a result we incurred a goodwill impairment charge of $1.9 billion. The cumulative impairment loss for goodwill was $3.4 billion for the Predecessor. The changes in the carrying amount of goodwill by reporting segment are presented in the following table.

The impairment indicators during the 2019 Predecessor Period and December 31, 2018, included the steep decline in oil prices and expectations for lower exploration and production capital spending that resulted in a sharp reduction in share prices in the oilfield services sector. See Goodwill Impairment Assessment Factors below for additional details. In 2017 our annual goodwill impairment test indicated that goodwill was not impaired. The changes in the carrying amount of goodwill by reporting segment for the years ended December 31, 2019 and 2018, are presented in the following table.
(Dollars in millions)
Western Hemisphere
 
Eastern Hemisphere
 
Total
Balance at December 31, 2017 (Predecessor)
$
1,958

 
$
769

 
$
2,727

Impairment
(1,380
)
 
(537
)
 
(1,917
)
Disposals
(10
)
 
—

 
(10
)
Reclassification to assets held for sale
(5
)
 
(2
)
 
(7
)
Acquisitions
—

 
27

 
27

Foreign currency translation
(69
)
 
(38
)
 
(107
)
Balance at December 31, 2018 (Predecessor)
$
494

 
$
219

 
$
713

Impairment
(508
)
 
(222
)
 
(730
)
Reclassification from assets held for sale
4

 
—

 
4

Foreign currency translation
10

 
3

 
13

Balance at December 13, 2019 (Predecessor)
—

 
—

 
—

  Fresh Start Accounting Valuation
—

 
239

 
239

Balance at December 31, 2019 (Successor)
$
—

 
$
239

 
$
239



Goodwill Impairment Assessment Factors

The Predecessor impairment indicators during 2019 were a result of lower activity levels and lower exploration and production capital spending that resulted in a decline in drilling activity and forecasted growth in all our reporting units. Our lower than expected and forecasted financial results were due to the continued weakness within the energy market and consequently our inability to meet the original timeline of our restructuring plan savings, defined in “Note 11 – Restructuring, Facility Consolidation and Severance Charges.” These circumstances, prompted us to evaluate whether circumstances had changed that would more likely than not reduce the fair value of one or more of our reporting units below their carrying amount.

When conducting this evaluation, we considered macroeconomic and industry conditions, including the outlook for exploration and production spending by our customers and overall financial performance of each of our reporting units. We also considered whether there were any changes in our long-term forecasts, which are impacted by assumptions about the future commodity pricing and supply and demand for our goods and services.

Intangible Assets

The components of intangible assets were as follows:
 
Successor
 
December 31, 2019
 
Gross
 
 
 
Net
 
Carrying
 
Accumulated
 
Intangible
(Dollars in millions)
Amount
 
Amortization
 
Assets
Developed and Acquired Technology
$
728

 
$
(7
)
 
$
721

Trade Names
395

 
(2
)
 
393

Totals
$
1,123

 
$
(9
)
 
$
1,114


 
 
 
 
At December 31, 2018, our intangible assets were $213 million, net of amortization. Amortization expense was $9 million in the Successor Period and was $61 million for the Predecessor Period, and $63 million and $52 million for the years ended December 31, 2018 and 2017, respectively. Based on the carrying value of intangible assets at December 31, 2019, amortization expense for the subsequent five years is estimated as follows (dollars in millions): 
Period
Amount

2020
$
184

2021
184

2022
184

2023
184

2024
177