Impairment Considerations (goodwill and intangibles)

The current Covid-19 pandemic has caused a significant deterioration in global economic conditions, including high levels of unemployment and a significant contraction in economic activity. The global economy may be in the midst of an economic recession or depression. We evaluate the carrying value of goodwill and intangibles for impairment whenever management believes indicators of impairment might exist. A significant deterioration in macroeconomic conditions is a key indicator of possible impairment. In addition to macroeconomic conditions, management considered the factors in ASC 350 when analyzing goodwill and intangibles for possible impairment, including the following:

Conditions in the global SMT and semiconductor capital equipment markets;
Our revenue and profitability in the three months ended March 31, 2020;
Our backlog at March 31, 2020, which stood at $24.8 million;
Our forecasts for revenue and profitability for the remainder of 2020;
The manner of use and applicability of our intangibles, which is not expected to change; and
Our stock market capitalization, which is significantly greater than our net book value.

After carefully considering the factors outlined above, among others, we determined that it is more likely than not that our goodwill and intangibles were not impaired as of March 31, 2020.

Intangible assets consist of the following:


	March 31, 2020							December 31, 2019
(In thousands)	Gross Carrying Amount		Accumulated Amortization			Net		Gross Carrying Amount		Accumulated Amortization			Net
Patents	$	2,916	$	(2,700	)	$	216	$	2,898	$	(2,662	)	$	236
Software	206		(178		)	28		206		(170		)	36
Marketing assets and customer relationships	101		(65		)	36		101		(63		)	38
	$	3,223	$	(2,943	)	$	280	$	3,205	$	(2,895	)	$	310

Amortization expense in the three months ended March 31, 2020 and the three months ended March 31, 2019 was as follows:

Estimated aggregate amortization expense based on current intangible assets for the next five years is expected to be as follows: $126,000 for the remainder of 2020; $100,000 in 2021; $43,000 in 2022; $9,000 in 2023; and $2,000 in 2024.