Goodwill and Intangible Assets

6 Months Ended

Mar. 28, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

We have two operating and reportable segments: (1) Software Products and (2) Professional Services. We assess goodwill for impairment at the reporting unit level. Our reporting units are determined based on the components of our operating segments that constitute a business for which discrete financial information is available and for which operating results are regularly reviewed by segment management. Our reporting units are the same as our operating segments.

As of March 28, 2020, goodwill and acquired intangible assets in the aggregate attributable to our Software Products segment was $1,809.1 million and attributable to our Professional Services segment was $45.2 million. As of September 30, 2019, goodwill and acquired intangible assets in the aggregate attributable to our Software Products segment was $1,362.4 million and attributable to our Professional Services segment was $45.7 million. Acquired intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable.

We completed our annual goodwill impairment review as of June 29, 2019 based on a qualitative assessment. Our qualitative assessment included company specific (financial performance and long-range plans), industry, and macroeconomic factors, and consideration of the fair value of each reporting unit relative to its carrying value at the last valuation date. Based on our qualitative assessment, we believe it is more likely than not that the fair values of our reporting units exceed their carrying values and no further impairment testing is required.

Goodwill and acquired intangible assets consisted of the following:



(in thousands)	March 28, 2020						September 30, 2019
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Goodwill (not amortized)					$	1,603,081					$	1,238,179
Intangible assets with finite lives (amortized):
Purchased software	$	427,092	$	292,756	$	134,336	$	377,359	$	278,144	$	99,215
Capitalized software	22,877		22,877		—		22,877		22,877		—
Customer lists and relationships	413,054		303,095		109,959		355,931		288,828		67,103
Trademarks and trade names	22,524		15,628		6,896		18,891		15,260		3,631
Other	3,942		3,942		—		3,910		3,910		—
	$	889,489	$	638,298	$	251,191	$	778,968	$	609,019	$	169,949
Total goodwill and acquired intangible assets					$	1,854,272					$	1,408,128

Goodwill

Changes in goodwill presented by reportable segments were as follows:



(in thousands)	Software Products			Professional Services		Total
Balance, October 1, 2019	$	1,196,064		$	42,115	$	1,238,179
Onshape acquisition	364,910			—		364,910
Foreign currency translation adjustment	(8		)	—		(8		)
Balance, March 28, 2020	$	1,560,966		$	42,115	$	1,603,081

Amortization of Intangible Assets

The aggregate amortization expense for intangible assets with finite lives was classified in our Consolidated Statements of Operations as follows:



(in thousands)	Three months ended				Six months ended
	March 28, 2020		March 30, 2019		March 28, 2020		March 30, 2019
Amortization of acquired intangible assets	$	7,288	$	5,930	$	14,065	$	11,866
Cost of license revenue	6,879		6,842		13,678		13,559
Total amortization expense	$	14,167	$	12,772	$	27,743	$	25,425