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GOODWILL AND PURCHASED INTANGIBLE ASSETS
 12 Months Ended
Jun. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL AND PURCHASED INTANGIBLE ASSETS GOODWILL AND PURCHASED INTANGIBLE ASSETS
Goodwill
Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in business combinations. We have three reportable segments and five operating segments. The operating segments are determined to be the same as reporting units. Prior to July 1, 2022, we had a fourth segment, Other, but core assets from that segment were sold, making it non-operational and the segment was eliminated.
The following table presents goodwill carrying value and the movements by reporting unit during the fiscal years ended June 30, 2023 and 2022(1):
(In thousands)Wafer Inspection and Patterning
Global Service and Support (“GSS”)
Specialty Semiconductor ProcessPCB and Display Component InspectionTotal
Balance as of June 30, 2021$416,860 $25,908 $681,858 $872,971 $13,575 $2,011,172 
Acquired goodwill308,952 — — — — 308,952 
Foreign currency adjustment(75)— — — — (75)
Balance as of June 30, 2022725,737 25,908 681,858 872,971 13,575 2,320,049 
Acquired goodwill6,776 — — — — 6,776 
Goodwill disposal from sale of business(2)
— — — (42,622)— (42,622)
Goodwill adjustments(5,337)— — — — (5,337)
Foreign currency adjustment(46)— — — — (46)
Balance as of June 30, 2023$727,130 $25,908 $681,858 $830,349 $13,575 $2,278,820 
_________________
(1)No goodwill was assigned to the Other reporting unit, which existed until June 30, 2022, and, accordingly, it is not disclosed in the table above.
(2)Refer to the Business Dispositions section of Note 6 “Business Combinations and Dispositions” for more information on the sale of Orbograph.
Goodwill is not subject to amortization but is tested for impairment annually during the third fiscal quarter, as well as whenever events or changes in circumstances indicate that the carrying value may not be recoverable.
We performed the required annual goodwill impairment tests as of February 28, 2023 and 2022, and concluded that goodwill was not impaired. As a result of our qualitative assessments, we determined that it was not necessary to perform the quantitative assessments at those times.
Goodwill as of June 30, 2023, 2022 and 2021 is net of accumulated impairment losses of $534.2 million, of which $277.6 million was included in the Wafer Inspection and Patterning reporting unit, $144.2 million was included in the Specialty Semiconductor Process reporting unit, and $112.5 million was included in the PCB and Display reporting unit.
There have been no significant events or circumstances affecting the valuation of goodwill subsequent to the assessment performed in the third quarter of the fiscal year ended June 30, 2023. The next annual assessment of goodwill by reporting unit is scheduled to be performed in the third quarter of the fiscal year ending June 30, 2024.
Purchased Intangible Assets
The components of purchased intangible assets as of the dates indicated below were as follows:
(In thousands)As of June 30, 2023As of June 30, 2022
Category Range of
Useful Lives
(in years)		Gross
Carrying
Amount		Accumulated
Amortization and Impairment		Net
Amount		Gross
Carrying
Amount		Accumulated
Amortization and Impairment		Net
Amount
Existing technology
4-8
$1,536,826 $841,815 $695,011 $1,523,691 $668,175 $855,516 
Customer relationships
4-9
358,567 205,037 153,530 366,567 167,819 198,748 
Trade name/trademark
4-7
116,583 78,749 37,834 121,083 68,194 52,889 
Order backlog and other
<1-7
85,836 82,264 3,572 87,836 58,970 28,866 
Intangible assets subject to amortization(1)
2,097,812 1,207,865 889,947 2,099,177 963,158 1,136,019 
IPR&D61,322 15,966 45,356 64,457 6,062 58,395 
Total$2,159,134 $1,223,831 $935,303 $2,163,634 $969,220 $1,194,414 
(1)The disposition of Orbograph during the three months ended September 30, 2022 resulted in a decrease in the gross amount of intangible assets subject to amortization of $34.5 million, a decrease in accumulated amortization of $15.9 million, and a decrease in the net amount of intangible assets of $18.6 million. Refer to the “Business Dispositions” section of Note 6 “Business Combinations and Dispositions” for more information on the sale of Orbograph.
Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies” for our policy of testing purchased intangible assets for impairment.
As of June 30, 2023 and 2022, there were no impairment indicators for purchased intangible assets.
Amortization expense for purchased intangible assets for the periods indicated below was as follows:
Year Ended June 30,
(In thousands)202320222021
Amortization expense - Cost of revenues$181,405 $168,957 $156,596 
Amortization expense - SG&A79,089 60,017 49,531 
Amortization expense - R&D125 124 125 
Total $260,619 $229,098 $206,252 
Based on the purchased intangible assets’ gross carrying value recorded as of June 30, 2023, the remaining estimated annual amortization expense is expected to be as follows:
Fiscal Year Ending June 30:Amortization
(In thousands)
2024$238,575 
2025222,123 
2026206,210 
2027129,630 
202847,232 
Thereafter46,177 
Total$889,947