AGILYSYS INC Goodwill & Intangibles Disclosure
5. Intangible Assets, Goodwill, and Software Development Costs
The following table summarizes our intangible assets and software development costs at March 31, 2026, and 2025:
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March 31, 2026 |
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March 31, 2025 |
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Gross |
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Net |
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Gross |
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Net |
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carrying |
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Accumulated |
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Accumulated |
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carrying |
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carrying |
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Accumulated |
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Accumulated |
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carrying |
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(In thousands) |
|
amount |
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amortization |
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Impairment |
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amount |
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amount |
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amortization |
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impairment |
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|
amount |
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Finite-lived intangible assets: |
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Customer relationships |
|
$ |
54,793 |
|
|
$ |
(16,159 |
) |
|
$ |
— |
|
|
$ |
38,634 |
|
|
$ |
53,763 |
|
|
$ |
(13,745 |
) |
|
$ |
— |
|
|
$ |
40,018 |
|
Non-competition agreements |
|
|
8,845 |
|
|
|
(6,366 |
) |
|
|
— |
|
|
|
2,479 |
|
|
|
8,669 |
|
|
|
(4,522 |
) |
|
|
— |
|
|
|
4,147 |
|
Developed technology |
|
|
13,691 |
|
|
|
(11,860 |
) |
|
|
— |
|
|
|
1,831 |
|
|
|
13,597 |
|
|
|
(11,178 |
) |
|
|
— |
|
|
|
2,419 |
|
Trade names |
|
|
17,700 |
|
|
|
(2,685 |
) |
|
|
— |
|
|
|
15,015 |
|
|
|
17,201 |
|
|
|
(1,383 |
) |
|
|
— |
|
|
|
15,818 |
|
Patented technology |
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|
80 |
|
|
|
(80 |
) |
|
|
— |
|
|
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— |
|
|
|
80 |
|
|
|
(80 |
) |
|
|
— |
|
|
|
— |
|
|
|
|
95,109 |
|
|
|
(37,150 |
) |
|
|
— |
|
|
|
57,959 |
|
|
|
93,310 |
|
|
|
(30,908 |
) |
|
|
— |
|
|
|
62,402 |
|
Indefinite-lived trade names |
|
|
8,400 |
|
|
N/A |
|
|
|
— |
|
|
|
8,400 |
|
|
|
8,400 |
|
|
N/A |
|
|
|
— |
|
|
|
8,400 |
|
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Total intangible assets |
|
$ |
103,509 |
|
|
$ |
(37,150 |
) |
|
$ |
— |
|
|
$ |
66,359 |
|
|
$ |
101,710 |
|
|
$ |
(30,908 |
) |
|
$ |
— |
|
|
$ |
70,802 |
|
|
|
|
|
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(In thousands) |
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Software development costs |
|
$ |
67,541 |
|
|
$ |
(45,535 |
) |
|
$ |
(22,006 |
) |
|
$ |
— |
|
|
$ |
67,541 |
|
|
$ |
(45,535 |
) |
|
$ |
(22,006 |
) |
|
$ |
— |
|
During the year ended March 31, 2026, goodwill increased $3.3 million due to foreign currency translation. During the year ended March 31, 2025, goodwill increased $104.0 million due to business combination activity and decreased $6.2 million due to foreign currency translation.
During the year ended March 31, 2026, finite-lived intangible assets decreased $6.1 million due to amortization expense and increased $1.7 million due to foreign currency translation. During the year ended March 31, 2025, finite-lived intangible assets increased $61.0 million due to business combination activity and decreased $4.0 million and $3.1 million due to amortization expense and foreign currency translation, respectively. We recognize amortization expense of developed technology in cost of goods sold.
See Note 16, Business Combination, for more information on business combination activity.
Estimated future amortization expense on finite-lived intangible assets is as follows:
(In thousands) |
|
Estimated Amortization Expense |
|
|
Fiscal year ending March 31, |
|
|
|
|
2027 |
|
$ |
5,991 |
|
2028 |
|
|
4,660 |
|
2029 |
|
|
3,972 |
|
2030 |
|
|
3,660 |
|
2031 |
|
|
3,464 |
|
Thereafter |
|
|
36,212 |
|
Total |
|
$ |
57,959 |
|
Indefinite-lived intangible assets, comprised of our purchased trade name InfoGenesis as of March 31, 2026 and 2025 are tested for impairment upon identification of impairment indicators or at least annually. An impairment loss is recognized if the carrying amount is greater than fair value. The InfoGenesis indefinite-lived purchased trade name impairment testing resulted in a fair value exceeding the carrying amount for each of the years ending March 31, 2026, 2025 and 2024.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | May 21, 2026 | Showing above |
| 2025 | May 23, 2025 | |
| 2024 | May 22, 2024 | |
| 2023 | May 19, 2023 | |
| 2022 | May 23, 2022 | |
| 2021 | May 21, 2021 | |
| 2020 | May 22, 2020 | |
| 2019 | May 24, 2019 | |
| 2018 | May 25, 2018 | |
| 2017 | Jun 2, 2017 | |
| 2016 | Jun 10, 2016 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.