Intangible Assets and Goodwill
Intangible Assets
The cost and accumulated amortization of intangible assets subject to amortization as of December 31, 2025 and 2024, is as follows:
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| | | 2025 | | 2024 |
| (Thousands) | | Gross Carrying Amount | | Accumulated Amortization | | Net | | Gross Carrying Amount | | Accumulated Amortization | | Net |
| Customer relationships | | $ | 98,141 | | | $ | (41,435) | | | $ | 56,706 | | | $ | 97,428 | | | $ | (37,960) | | | $ | 59,468 | |
| Technology | | 46,200 | | | (20,186) | | | 26,014 | | | 43,588 | | | (16,415) | | | $ | 27,173 | |
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| Licenses and other | | 36,785 | | | (17,231) | | | 19,554 | | | 36,234 | | | (15,182) | | | $ | 21,052 | |
| Total | | $ | 181,126 | | | $ | (78,852) | | | $ | 102,274 | | | $ | 177,250 | | | $ | (69,557) | | | $ | 107,693 | |
Amortization expense for 2025, 2024, and 2023 was $11.0 million, $12.1 million, and $12.9 million, respectively. Intangible assets also includes deferred costs relating to the Company's revolving credit and consignments lines of $3.6 million and $1.6 million at December 31, 2025 and 2024, respectively.
Estimated amortization expense for each of the five succeeding years is as follows:
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| | Amortization |
| (Thousands) | | Expense |
| 2026 | | 10,135 | |
| 2027 | | 10,033 | |
| 2028 | | 10,033 | |
| 2029 | | 10,033 | |
| 2030 | | 10,033 | |
Goodwill
The balance of goodwill at December 31, 2025 and 2024 was $280.7 million and $263.7 million, respectively.
A summary of changes in goodwill by reportable segment is as follows:
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| (Thousands) | | Performance Materials | | Electronic Materials | | Precision Optics | | Total |
| Balance at December 31, 2023 | | $ | 26,157 | | | $ | 206,673 | | | $ | 88,043 | | | $ | 320,873 | |
| Acquisition | | — | | | — | | | — | | | — | |
| Impairment charge | | — | | | — | | | (56,067) | | | (56,067) | |
| Currency translation and other | | — | | | (373) | | | (695) | | | (1,068) | |
| Balance at December 31, 2024 | | $ | 26,157 | | | $ | 206,300 | | | $ | 31,281 | | | $ | 263,738 | |
| Acquisition | | — | | | 14,893 | | | — | | | 14,893 | |
| Impairment charge | | — | | | — | | | — | | | — | |
| Currency translation and other | | — | | | 237 | | | 1,789 | | | 2,026 | |
| Balance at December 31, 2025 | | $ | 26,157 | | | $ | 221,430 | | | $ | 33,070 | | | $ | 280,657 | |
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Due to historical results combined with the partial impairment charge recognized in 2024 within the Precision Optics reporting unit, the Company elected to perform a quantitative annual impairment assessment for the Precision Optics reporting unit's goodwill as of October 1, 2025 and a qualitative impairment test for the Performance Materials and Electronic Materials reporting units.
As discussed in Note A, the Company's annual goodwill impairment test indicated the carrying value of the Precision Optics reporting unit exceeded its estimated fair value as of the measurement date of October 1, 2024. As a result, the Company recognized a goodwill impairment charge in the fourth quarter of fiscal 2024 of $56.1 million which was recorded in "Goodwill Impairment" in the accompanying Consolidated Statements of Income in the Precision Optics segment. Based on the testing performed for the Precision Optics reporting unit as of October 1, 2025, the Company determined that the estimated fair value exceeded its carrying value; therefore no impairment charge was necessary.
Management believes the future sales growth and EBITDA margins in the long range plan, and the discount rate used in the valuations requires significant use of judgment. If any of our reporting units do not meet our long range plan estimates or our discount rate increase significantly, we could be required to perform an interim goodwill impairment analysis or recognize charges in future periods. Any impairment charges that the Company may take in the future could be material to its consolidated results of operations and financial condition.
The Company's accumulated goodwill impairment losses were $76.7 million as of December 31, 2025 and 2024. Accumulated impairment losses were from the closure of the LAC reporting unit which was closed as of December 31, 2020 and the Precision Optics charge taken in the fourth quarter of 2024.