8x8 2016 Annual Report Download - page 70

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4. PROPERTY AND EQUIPMENT
Property and equipment consisted of the following (in thousands):
March 31,
2016 2015
Machinery and computer equipment $ 20,040 $ 16,099
Furniture and fixtures 1,067 759
Licensed software 6,350 4,696
Leasehold improvements 3,865 3,812
Construction in progress 967 942
32,289 26,308
Less: accumulated depreciation and amortization (19,914) (16,060)
$ 12,375 $ 10,248
5. INTANGIBLE ASSETS
The carrying value of intangible assets consisted of the following (in thousands):
March 31, 2016 March 31, 2015
Gross Gross
Carrying Accumulated
Net
Carrying Carrying Accumulated
Net
Carrying
Amount Amortization Amount Amount Amortization Amount
Technology $ 18,640 $ (4,622) $ 14,018 $ 8,242 $ (2,905) $ 5,337
Customer relationships 9,993 (4,847) 5,146 9,686 (3,720) 5,966
Trade names/domains 2,205 - 2,205 957 - 957
In-process research and development 95 - 95 - - -
Total acquired identifiable intangible
assets
$ 30,933 $ (9,469) $ 21,464 $ 18,885 $ (6,625) $ 12,260
At March 31, 2016, annual amortization of intangible assets, based upon our existing intangible assets and current useful lives, is estimated to be the following (in
thousands):
Amount
2017 $ 3,845
2018 3,577
2019 3,327
2020 3,327
2021 2,936
Thereafter 2,152
Total $ 19,164
ImpairmentofLong-LivedAssets
During the year ended March 31, 2016, the Company decided to end-of-life its hosted virtual desktop service (Zerigo). The Company evaluated long-lived assets
related to Zerigo including the technology, customer relationships, and trade name intangible assets for impairment. The Company determined it was appropriate to
record an impairment charge equal to the remaining value of the impaired long-lived assets in the third fiscal quarter. The impairment recorded during the fiscal
year was $0.6 million, of which $0.4 million and $0.2 million was recorded in cost of service and sales and marketing, respectively, in the consolidated statements
of operations. Revenues and net income (loss) from Zerigo were not material for all periods presented.
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