iRobot 2015 Annual Report Download - page 156

Download and view the complete annual report

Please find page 156 of the 2015 iRobot annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 172

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172

iROBOT CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
73
During the second quarter of 2013, the Company decided to refocus its funded research activities. The Company
considered this decision to be an impairment indicator, requiring an interim impairment test within the research reporting unit.
The Company performed an impairment assessment using the income approach, and determined that goodwill was impaired.
The Company recorded an impairment loss of $0.2 million within general and administrative expenses during the fiscal year
ended December 28, 2013.
In the fourth quarter of 2015, the Company completed its annual goodwill impairment tests on the goodwill associated
with the acquisitions of Evolution Robotics, Inc. and Nekton Research, LLC and did not identify any goodwill impairment. The
Company further considered the subsequent event of the signed definitive agreement associated with the sale of the defense and
security business unit, and reevaluated its position which incorporated the associated purchase price and reconfirmed that no
impairment of the Nekton goodwill exists.
Other intangible assets include the value assigned to completed technology, research contracts, and trade names. The
estimated useful lives for all of these intangible assets are two to ten years. The intangible assets are being amortized on a
straight-line basis, which is consistent with the pattern that the estimated economic benefits of the intangible assets are expected
to be utilized.
Intangible assets at January 2, 2016 and December 27, 2014 consisted of the following:
January 2, 2016 December 27, 2014
Cost Accumulated
Amortization Net Cost Accumulated
Amortization Impairment
Loss Net
(In thousands)
Completed technology $ 26,900 $11,236 $15,664 $30,600 $9,691 $ 1,788 $19,121
Research contracts
—
—
—
100 100
—
—
Tradename 100 100
—
800 775
—
25
Total $ 27,000 $ 11,336 $ 15,664 $ 31,500 $ 10,566 $ 1,788 $ 19,146
As part of the Company's decision during 2013 to refocus its funded research activities, the Company decided to no
longer pursue certain research contracts in which completed technology acquired as part of the acquisition of Nekton Research,
LLC was utilized. As a result, the Company performed an impairment assessment of the associated intangible asset using the
income approach, and recorded an impairment loss of $1.8 million within general and administrative expenses during the fiscal
year ended December 28, 2013.
Amortization expense related to acquired intangible assets was $3.5 million, $3.5 million, and $3.8 million for the fiscal
years ended January 2, 2016, December 27, 2014 and December 28, 2013, respectively. The estimated future amortization
expense related to current intangible assets in each of the five succeeding fiscal years is expected to be as follows:
(In thousands)
2016 $3,457
2017 3,457
2018 3,457
2019 2,818
2020 900
Total $ 14,089
15. Restructuring charges
In 2013, the Company incurred restructuring charges of $3.3 million primarily related to a $1.8 million write-down of an
intangible asset, costs associated with the closing of its San Luis Obispo, California office and severance-related costs.