Goodwill

12 Months Ended

Dec. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

8. Goodwill

The Company tests goodwill at least annually for impairment. The Company tests more frequently if indicators are present or changes in circumstances suggest that impairment may exist. These indicators include, among others, declines in sales, earnings or cash flows, or the development of a material adverse change in the business climate. The Company assesses goodwill for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment.

The following table presents the net carrying value of goodwill as of December 31, 2022, and 2021, and a rollforward of such balances from December 31, 2021, by reportable segment:

(U.S. Dollars, in thousands)	December 31, 2021			Impairment		Currency Translation Adjustment			December 31, 2022
Global Spine	$	71,317		$	—	$	—		$	71,317
Global Orthopedics		11,822					(692	)		11,130
Goodwill, gross	$	83,139		$	—	$	(692	)	$	82,447
Accumulated impairment loss		(11,822	)		—		692			(11,130	)
Goodwill, net of accumulated impairment losses	$	71,317		$	—	$	—		$	71,317

In the fourth quarter of 2021, the Company performed a quantitative assessment of its goodwill. The Company estimated the fair value of each reporting unit using a weighted average of fair value derived from both an income approach and a market approach (all Level 3 fair value measurements). Upon estimating the fair value of each of its reporting units, the Company determined its Global Orthopedics reporting unit’s fair value was less than its carrying value of net assets. This resulted in recording a full impairment of the Global Orthopedics goodwill of $11.8 million, which was reflected within Acquisition-related amortization and

remeasurement. This amount also represents the total of the Company’s accumulated goodwill impairment losses as of December 31, 2022, and 2021, respectively. The assessment concluded there were no indicators of impairment for the Global Spine goodwill.

In the fourth quarter of 2022, the Company performed a qualitative assessment for its annual goodwill impairment analysis, which did not result in impairment. This qualitative analysis considered all relevant factors specific to the reporting units, including macroeconomic conditions, industry and market considerations, overall financial performance, and relevant entity-specific events.