Goodwill And Other Intangible Assets

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

NOTE 9. GOODWILL AND OTHER INTANGIBLE ASSETS

We test goodwill for impairment at a reporting unit level, which is deemed to be our principal operating segments or one level below. With our annual impairment testing as of October 1, the calculated fair value of each reporting unit exceeded its book value.

During the third quarter of 2024, we updated the long-term strategic plan of our Business Wireline reporting unit. The updated plans reflected lower long-term projected future cash flows associated with the industry-wide secular decline, including a faster-than-previously anticipated decline of legacy services. We identified this as an impairment indicator and performed an interim quantitative goodwill impairment test of our Business Wireline reporting unit. The interim impairment test methodology was consistent with our approach for annual impairment testing (see Note 1), using similar models updated with our current view of key inputs and assumptions. We concluded that the calculated fair value of the Business Wireline reporting unit was lower than the book value, resulting in a goodwill impairment. As a result, in the third quarter of 2024, we recorded a noncash goodwill impairment charge of $4,422 in our consolidated statements of income, which represented the entirety of Business Wireline reporting unit goodwill.

In 2022, we recorded noncash impairment charges of $13,478 in our Business Wireline reporting unit, $10,508 in our Consumer Wireline reporting unit and the entire $826 in our Mexico reporting unit. The decline in fair values was primarily due to changes in the macroeconomic environment, namely increased weighted-average cost of capital. Also, inflation pressure and lower projected cash flows driven by secular declines, predominantly at Business Wireline, impacted the fair values.

Changes to our goodwill in 2024 resulted from the noncash impairment discussed above. Changes to our goodwill in 2023 resulted from goodwill attributed to assets contributed to the formation of strategic joint ventures.

Our Communications segment has three reporting units: Mobility, Consumer Wireline and Business Wireline. Business Wireline goodwill was fully impaired in the third quarter of 2024. The reporting unit is deemed to be the operating segment for Latin America and its goodwill was fully impaired in 2022. At December 31, 2024, accumulated goodwill impairments totaled $29,234.

The following table sets forth the changes in the carrying amounts of goodwill for the Communications segment:


	2024						2023
	Balance at Jan. 1		Impairment		Balance at Dec. 31		Balance at Jan. 1		Dispositions and other		Balance at Dec. 31
Communications
Goodwill	$	91,840	$	—	$	91,840	$	91,881	$	(41)	$	91,840
Accumulated Impairments	(23,986)		(4,422)		(28,408)		(23,986)		—		(23,986)






Total	$	67,854	$	(4,422)	$	63,432	$	67,895	$	(41)	$	67,854

We review amortizing intangible assets for impairment whenever events or circumstances indicate that the carrying amount may not be recoverable over the remaining life of the asset or asset group.

Indefinite-lived wireless licenses increased in 2024 primarily due to compensable relocation and incentive payments and $199 of capitalized interest. Indefinite-lived wireless licenses increased in 2023 primarily due to compensable relocation and incentive payments and $695 of capitalized interest. (See Notes 6 and 23)

Our other intangible assets at December 31 are summarized as follows:


	2024							2023
Other Intangible Assets	Weighted-Average Life	Gross Carrying Amount		Accumulated Amortization		Currency Translation Adjustment		Gross Carrying Amount		Accumulated Amortization		Currency Translation Adjustment
Amortized intangible assets:
Wireless licenses	21.6 years	$	2,999	$	696	$	(343)	$	3,034	$	572	$	23
Customer lists and relationships	10.0 years	349		275		(74)		379		286		(74)
Trademarks, trade names and other	12.6 years	43		23		(6)		289		261		(5)
Total	21.6 years	$	3,391	$	994	$	(423)	$	3,702	$	1,119	$	(56)

Indefinite-lived intangible assets not subject to amortization:


Wireless licenses	$	125,075	$	124,734
Trade names	5,241		5,241
Total	$	130,316	$	129,975

Amortized intangible assets are definite-life assets, and, as such, we record amortization expense based on a method that most appropriately reflects our expected cash flows from these assets. Amortization expense for definite-life intangible assets was $159 for the year ended December 31, 2024, $184 for the year ended December 31, 2023 and $169 for the year ended December 31, 2022. Estimated amortization expense for the next five years is: $129 for 2025, $131 for 2026, $130 for 2027, $130 for 2028 and $130 for 2029.