Goodwill and Intangible Assets, Net
There were no changes in the carrying amount of Goodwill for the years ended December 31, 2025 and 2024.
Intangible assets, net as of December 31, 2025 and 2024 consisted of the following:
| | | | | | | | | | | | | | | | | |
| | | As of December 31, |
| Useful Lives | | 2025 | | 2024 |
| Patent application costs | 3 Years | | $ | 689,174 | | | $ | 599,223 | |
| Trade name and trademarks | 3 Years | | 74,975 | | | 65,948 | |
| Intangible assets, gross | | | 764,149 | | | 665,171 | |
| Less: Accumulated amortization | | | (583,114) | | | (451,893) | |
| Intangible assets, net | | | $ | 181,035 | | | $ | 213,278 | |
The Company determined that for the years ended December 31, 2025 and 2024, $10 thousand and $2 thousand, respectively, of Patent application costs were impaired. The impaired Patent application costs were expensed to Selling, general, and administrative expense during the year ended December 31, 2025.
The Company added 3 patents during the year ended December 31, 2025 bringing the total number of patents issued to 26 as of December 31, 2025.
Intangible asset amortization expense is recognized on a straight-line basis and for the year ended December 31, 2025 and 2024 totaled $134 thousand and $136 thousand, respectively.
Estimated future amortization expense of Intangible assets, net is as follows:
| | | | | | | | |
| Years Ending December 31, | | Amount |
| 2026 | | $ | 101,892 | |
| 2027 | | 59,675 | |
| 2028 | | 19,468 | |
| | $ | 181,035 | |
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.