IMAX CORPIMAX
IMAX CORP Goodwill & Intangibles Disclosure
12. Goodwill and Other Intangible Assets
Goodwill
As of December 31, 2025, the Company’s total Goodwill was $45.8 million (December 31, 2024 — $52.8 million) of which $39.0 million (December 31, 2024 — $39.0 million) relates to the Technology Products and Services reporting unit and $6.8 million (December 31, 2024 — $13.8 million) relates to the Streaming and Consumer Technology reporting unit (formerly SSIMWAVE reporting unit, refer to Note 20 for additional information).
For the Technology Products and Services reporting unit, the Company performed a qualitative impairment test as of September 30, 2025 (annual test date) to evaluate whether it is more likely than not that the fair value of its reporting units was less than their respective carrying amounts. Based on such assessment, the Company concluded, that it is more likely than not that the fair value of any such reporting unit is more than its carrying value.
The Company performed both a qualitative and quantitative assessment of goodwill impairment for the SSIMWAVE reporting unit as of November 1, 2025 (annual test date). The impairment test indicated that a partial goodwill impairment charge of $7.0 million was required, with $6.8 million of goodwill remaining within the SSIMWAVE reporting unit. The impairment charge was due to a change in the Company’s market focus, resulting in a downward adjustment to the SSIMWAVE reporting unit’s expected cash flows based on the discounted cash flow method. The discounted cash flow method, which estimates fair value based on the present value of future cash flows, required the Company to make various assumptions regarding the timing and amount of these cash flows, including revenue growth rates, projected operating expenditures, and the terminal value of the business at the end of the projection period. The Company’s 2025 assessment includes assumptions about future cash flows based on its internal forecasts, which incorporate the 2026 budget and the long-range plan. The revenue growth rates were based on expected trends supported by market growth projections. The terminal value was estimated using a long-term growth rate that closely approximated inflation. The discount rate determined for the reporting unit was based on the risks of achieving the future cash flows, including risks applicable to the industry and market as a whole, as well as the capital structure of comparable entities. For the impairment test of the SSIMWAVE reporting unit, the Company utilized a discount rate of 15.2% and a revenue growth rate of 25.0% in certain years which represent the most significant assumptions in the model.
Assumptions and estimates about future cash flows and discount rates are complex and often subjective and require significant judgment. The analysis is dependent on internal forecasts, estimation of the long-term rates of revenue growth for the Company’s reporting units, terminal growth rates, profitability measures, and determination of the discount rates for the reporting units.
Assuming that all other components of the Company’s fair value estimate remain unchanged, an increase of 100 basis points in discount rate increases the impairment by $1.4 million, a 10% decline in forecasted revenue increases the impairment by $3.5 million, and a decrease of 10% in the revenue growth rate increases the impairment by $1.7 million.
Changes to the carrying amount of goodwill for the years ended December 31, 2025 and 2024 were as follows:
As of December 31, 2025 | |||||||||||||||||
(In thousands of U.S. Dollars) | Cost | Impairment | Net Book Value | ||||||||||||||
Goodwill | $ | 52,815 | $ | 7,000 | $ | 45,815 | |||||||||||
As of December 31, 2024 | |||||||||||||||||
(In thousands of U.S. Dollars) | Cost | Impairment | Net Book Value | ||||||||||||||
Goodwill | $ | 52,815 | $ | — | $ | 52,815 | |||||||||||
Other Intangible Assets
As of December 31, 2025 | |||||||||||||||||
(In thousands of U.S. Dollars) | Cost | Accumulated Amortization and Impairment(1) | Net Book Value | ||||||||||||||
Licenses and intellectual property | $ | 26,168 | $ | 19,582 | $ | 6,586 | |||||||||||
Internal use software | 43,487 | 29,956 | 13,531 | ||||||||||||||
Developed technology | 6,184 | 3,390 | 2,794 | ||||||||||||||
In process research and development | 3,810 | — | 3,810 | ||||||||||||||
Patents and trademarks | 12,764 | 9,918 | 2,846 | ||||||||||||||
Customer relationships | 1,340 | 1,340 | — | ||||||||||||||
| Marketing-related intangibles | 5,542 | 2,740 | 2,802 | ||||||||||||||
| Other | 152 | 130 | 22 | ||||||||||||||
| Total | $ | 99,447 | $ | 67,056 | $ | 32,391 | |||||||||||
 (1)Refer to “Restructuring Charges and Other Impairments” in Note 25 for additional information. | |||||||||||||||||
As of December 31, 2024 | |||||||||||||||||
(In thousands of U.S. Dollars) | Cost | Accumulated Amortization and Impairment | Net Book Value | ||||||||||||||
Licenses and intellectual property | $ | 26,168 | $ | 18,167 | $ | 8,001 | |||||||||||
Internal use software | 39,769 | 27,171 | 12,598 | ||||||||||||||
Developed technology | 6,092 | 2,329 | 3,763 | ||||||||||||||
In process research and development | 3,810 | — | 3,810 | ||||||||||||||
Patents and trademarks | 12,851 | 10,070 | 2,781 | ||||||||||||||
Customer relationships | 1,340 | 452 | 888 | ||||||||||||||
| Marketing-related intangibles | 5,031 | 1,818 | 3,213 | ||||||||||||||
| Other | 160 | 90 | 70 | ||||||||||||||
| Total | $ | 95,221 | $ | 60,097 | $ | 35,124 | |||||||||||
During 2025, the Company capitalized $6.7 million related to the development of internal use software, marketing-related intangibles, as well as additions in patents and trademarks (2024 — $8.4 million). The weighted average amortization period for these additions is 5.3 years (2024 — 4.9 years). The net book value of the other intangible assets capitalized in 2025 was $5.5 million as of December 31, 2025 (2024 — $7.0 million).
During 2025, the Company incurred costs of $0.3 million to renew or extend the term of acquired patents and trademarks which were recorded in Selling, General and Administrative expenses (2024 — $0.5 million; 2023 — $0.4 million).
Fully amortized other intangible assets are still in use by the Company. In 2025, the Company identified and wrote off $0.6 million (2024 — $3.9 million; 2023—$1.0 million) of fully amortized patents and trademarks that are no longer in use.
The estimated amortization expense for each of the next five years following the December 31, 2025 balance sheet date was as follows:
(In thousands of U.S. Dollars) | Amount | ||||
| 2026 | $ | 10,034 | |||
| 2027 | 7,225 | ||||
| 2028 | 4,796 | ||||
| 2029 | 3,149 | ||||
| 2030 | 1,641 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 25, 2026 | Showing above |
| 2024 | Feb 19, 2025 | |
| 2023 | Feb 27, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Mar 4, 2021 | |
| 2019 | Feb 19, 2020 | |
| 2018 | Feb 26, 2019 | |
| 2016 | Feb 23, 2017 | |
| 2015 | Feb 24, 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.