TiVo 2013 Annual Report Download - page 86
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Table of Contents
Developed technology $10,259 $(4,716)$5,543 $15,161 $(4,441)$10,720
Intellectual property rights 19,118 (18,260)858 19,118 (16,616)2,502
Customer relationships and trade names 1,010 (83)927 3,130 (266)2,864
Developed technology and intangible assets
During the fiscal year ended January 31, 2013 the Company acquired developed technology and intangible assets of $14.9 million with
a weighted average life of 5.18 years.
The Company recognized non-cash impairment charges of $4.8 million in the three and twelve months ended January 31, 2014 of
which $4.5 million was related to intangible assets acquired as part of the TRA acquisition. The lower than expected profitability indicated that
the carrying value of these assets exceeded their estimated fair values as determined by future discounted cash flow projections. When
projecting the stream of future cash flows associated with TRA for purposes of determining long-lived asset recoverability, management
makes assumptions, incorporating market conditions, sales growth rates, gross profit, and operating expenses. The impairment charge of
$3.0 million associated with impairment of developed technology is included in the cost of service revenues and $1.5 million associated with
the impairment of customer relationships and trade names is included sales and marketing expenses for the three and twelve months ended
January 31, 2014.
The total expected future annual amortization expense related to purchased technology, capitalized software, and intangible assets is
calculated on a straight-line basis, using the useful lives of the assets, which range from three to five years for developed technology and two
to seven years for intellectual property rights and customer relationships and trade names. Amortization expense for the fiscal years ended
January 31, 2014, 2013, and 2012, was $4.3 million, $3.5 million, and $2.7 million, respectively. As of January 31, 2014, the estimated
future annual amortization expense (not including the Company's acquisition of Digitalsmiths on February 14, 2014) is set forth in the table
below:
2015 2,196
2016 2,018
2017 1,716
2018 1,155
2019 162
Thereafter 81
$7,328
Inventory was as follows:
83