Chegg 2013 Annual Report Download - page 132

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CHEGG, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Note 7. Intangible Assets
Intangible assets consist of the following (in thousands):
December 31, 2013
Weighted-
Average
Amortization
Period
(in months)
Gross
Carrying
Amount
Accumulated
Amortization
Net
Carrying
Amount
Developed technology ..................... 46 $ 8,008 $ (5,386) $2,622
Customer list ............................ 24 5,472 (5,029) 443
Trade name ............................. 33 1,182 (942) 240
Non-compete agreements .................. 34 1,068 (1,062) 6
Total intangible assets ..................... $15,730 $(12,419) $3,311
Weighted-
Average
Amortization
Period
(in months)
December 31, 2012
Gross
Carrying
Amount
Accumulated
Amortization
Impairment
Charges
Net
Carrying
Amount
Developed technology ....................... 40 $ 9,020 $ (4,730) $(187) $4,103
Customer list ............................... 24 5,695 (3,718) (316) 1,661
Trade name ................................ 32 1,200 (586) (87) 527
Non-compete agreements ..................... 22 1,650 (1,256) (21) 373
Total intangible assets ....................... $17,565 $(10,290) $(611) $6,664
During 2013, 2012 and 2011, amortization expense related to the above acquired intangible assets totaled
approximately $4.4 million, $6.8 million and $3.1 million, respectively.
During the fourth quarter of 2012, we determined that we would not integrate content related to the Notehall
and Student of Fortune services into our connected learning platform. As a result, the expected future cash flows
related to these services would significantly decrease. The impairment analysis was based on a discounted cash
flow analysis with key assumptions based on the future revenues expected until the services were removed from
our website. The residual value of the remaining intangible assets will continue to be amortized over the
remaining life of the intangible assets. The analysis indicated that the carrying amounts of the intangible assets
acquired might not be fully recoverable, resulting in impairment charges totaling $0.6 million, which was
comprised of $0.2 million recorded in technology and development and $0.4 million recorded in sales and
marketing in our statement of operations. Notehall and Student of Fortune were not material to our results of
operations.
As of December 31, 2013, the estimated future amortization expense related to our intangible assets, subject
to amortization, is as follows (in thousands):
Years ending December 31:
2014 .......................................... $2,137
2015 .......................................... 1,099
2016 .......................................... 75
Total .............................................. $3,311
86