As discussed in Note 16 – Segment Information, we reported two operating and reportable segments: Security Solutions and Secure Networks. The two operating and reportable segments represent the reporting units for purposes of testing goodwill. The following table reflects changes in the carrying amount of goodwill during the period by reportable segments.


Table 6.1: Changes in the Carrying Amount of Goodwill by Reportable Segments
	Security Solutions		Secure Networks		Total

	(in thousands)
Balance at December 31, 2024	$	3,006	$	14,916	$	17,922
Impairment losses	—		(14,916)		(14,916)
Balance at December 31, 2025	$	3,006	$	—	$	3,006


Table 6.2: Details of Goodwill, Net
	As of December 31,
	2025		2024

	(in thousands)
Gross	$	17,922	$	17,922
Accumulated impairment losses	(14,916)		—
Goodwill, net	$	3,006	$	17,922

The net assets attributable to the reporting units are determined based upon the estimated assets and liabilities attributable to the reporting units in deriving its free cash flows.

For fiscal year 2025, we performed a qualitative assessment of our reporting units and identified that it is more likely than not that the estimated fair value of our Security Solutions reporting unit exceeded its carrying value. Based on the initial qualitative assessment of our Secure Networks reporting unit, we determined that it is not more likely than not that the fair value of this reporting unit exceeds its carrying value, and therefore we performed a quantitative impairment test.

In the most recent annual impairment test, the fair value of the Secure Networks reporting unit was estimated using the result of the income approach. The income approach applied requires significant judgments, including estimation of future discounted cash flows, which is dependent on internally-developed forecasts of revenue and profitability of the existing backlog, and determination of our weighted average cost of capital, which is risk-adjusted to reflect the specific risk profile of the reporting unit being tested.

As a result of our fiscal year 2025 quantitative assessment of our Secure Networks reporting unit, we estimated that its carrying value exceeded its fair value. The goodwill impairment was primarily driven by the continued contraction of Secure Networks' backlog in 2025. Accordingly, we recorded a non-cash goodwill impairment of $14.9 million, representing a full goodwill impairment for Secure Networks. The impairment charge on goodwill was recorded on our consolidated statements of operations for the year ended December 31, 2025.

For fiscal year 2024, we performed a qualitative assessment of our reporting units and identified that it is more likely than not that the estimated fair value of the reporting units exceeded their carrying value and thus, we did not proceed to the quantitative impairment test. Based on the results of our annual impairment test of goodwill performed, the estimated fair value of our respective reporting units exceeded their respective carrying value, and no impairment charges were taken during the year ended December 31, 2024.