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GOODWILL & INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2024

11. GOODWILL & INTANGIBLE ASSETS

There was no goodwill balance at June 30, 2024 and December 31, 2023. The goodwill activity is as follows (in thousands):


	June 30,		December 31,
	2024		2023
Balance, beginning of year	$	—	$	112,955
Goodwill impairment		—		(112,911)
Foreign currency translation adjustment		—		(44)
Balance, end of period	$	—	$	—

Goodwill was fully impaired as of December 31, 2023. No impairment of goodwill has been recorded for the six months ended June 30, 2024 and 2023.

The Company performed a quantitative assessment during its annual impairment review for 2023 as of October 1, 2023 and concluded that the fair value of the Company’s single reporting unit was not less than its carrying amount. Due to sustained declines in Company’s stock price and the stock prices of comparable companies, we performed a quantitative assessment as of December 31, 2023, utilizing a combination of the income and market approaches. The results of the quantitative analysis performed indicated that the carrying value of the reporting unit exceeded the fair value. As such, a goodwill impairment charge of $110.4 million was recorded. Additionally, during the year ended December 31, 2023, the Company recorded a goodwill impairment charge of $2.5 million related to the sale of Aerosint. The Company recorded a total of $112.9 million in goodwill impairment charges during the year ended December 31, 2023.

The Company estimated the fair value using a weighted average of the income and market approaches. Specifically, the discounted cash flow method was used under the income approach and the guideline public company and guideline merged and acquired company methods were used under the market approach. The significant assumptions used under the income approach include management’s forecasts of future revenues and EBITDA margins used to calculate projected future cash flows, discount rates, and the terminal growth rate. The terminal value is based on an exit revenue multiple which requires significant assumptions regarding the selections of appropriate multiples that consider relevant market trading data. The Company bases its estimates and assumptions on its knowledge of the additive manufacturing industry, recent performance, expectations of future performance and other assumptions the Company believes to be reasonable. The significant assumptions used under the market approach include the control

premium and selection of comparable companies and comparable transactions. Comparable companies and transactions are chosen based on factors including industry classification, geographic region, product offerings, earnings growth and profitability.

Intangible assets consisted of the following (in thousands):


		June 30, 2024						December 31, 2023
	Weighted Average	Gross				Net		Gross				Net
	Remaining Useful	Carrying		Accumulated		Carrying		Carrying		Accumulated		Carrying
	Lives (in years)	Amount		Amortization		Amount		Amount		Amortization		Amount
Acquired technology	7.3	$	184,401	$	122,763	$	61,638	$	185,222	$	65,724	$	119,498
Trade name	5.2		12,299		11,114		1,185		12,302		3,952		8,350
Customer relationships	8.4		67,707		50,140		17,567		68,378		27,968		40,410
Capitalized software	—		518		518		—		518		518		—
Total intangible assets		$	264,925	$	184,535	$	80,390	$	266,421	$	98,162	$	168,259

During the three and six months ended June 30, 2024 and 2023, the Company recognized the following amortization expense (in thousands):


	Statement of	Three Months Ended June 30,				Six Months Ended June 30,
Category	Operations Line Item	2024		2023		2024		2023
Acquired technology	Cost of Sales	$	42,681	$	6,928	$	57,009	$	13,855
Acquired technology	Research and Development		175		556		350		1,109
Trade name	General and Administrative		5,758		418		7,180		833
Customer relationships	Sales and Marketing		17,317		2,537		22,439		5,057
Capitalized software	Research and Development		—		18		—		45
		$	65,931	$	10,457	$	86,978	$	20,899

The Company expects to recognize the following amortization expense (in thousands):


	Amortization Expense
2024 (remaining 6 months)	$	12,153
2025		21,751
2026		15,067
2027		10,399
2028		7,991
2029 and after		13,029
Total intangible amortization	$	80,390