NOVANTA INC Goodwill & Intangibles Disclosure
6. Goodwill, Intangible Assets and Impairment Charges
Goodwill
The following table summarizes changes in goodwill during the year ended December 31, 2025 (in thousands):
|
Amount |
|
|
Balance at beginning of year |
$ |
584,098 |
|
Goodwill from current year acquisitions |
|
43,192 |
|
Effect of foreign exchange rate changes |
|
20,058 |
|
Balance at end of year |
$ |
647,348 |
|
Goodwill by reportable segment as of December 31, 2025 was as follows (in thousands):
|
Reportable Segment |
|
|
|
|
||||||
|
Automation Enabling Technologies |
|
|
Medical Solutions |
|
|
Total |
|
|||
Goodwill |
$ |
447,313 |
|
|
$ |
351,264 |
|
|
$ |
798,577 |
|
Accumulated impairment of goodwill |
|
(119,507 |
) |
|
|
(31,722 |
) |
|
|
(151,229 |
) |
Total |
$ |
327,806 |
|
|
$ |
319,542 |
|
|
$ |
647,348 |
|
Goodwill by reportable segment as of December 31, 2024 was as follows (in thousands):
|
Reportable Segment |
|
|
|
|
||||||
|
Automation Enabling Technologies |
|
|
Medical Solutions |
|
|
Total |
|
|||
Goodwill |
$ |
439,980 |
|
|
$ |
295,347 |
|
|
$ |
735,327 |
|
Accumulated impairment of goodwill |
|
(119,507 |
) |
|
|
(31,722 |
) |
|
|
(151,229 |
) |
Total |
$ |
320,473 |
|
|
$ |
263,625 |
|
|
$ |
584,098 |
|
Intangible Assets
Intangible assets as of December 31, 2025 and 2024, respectively, are summarized as follows (dollar amounts in thousands):
|
December 31, 2025 |
|
|||||||||||||
|
Gross Carrying |
|
|
Accumulated |
|
|
Net Carrying |
|
|
Weighted Average Remaining Life (Years) |
|
||||
Amortizable intangible assets: |
|
|
|
|
|
|
|
|
|
|
|
||||
Patents and developed technologies |
$ |
235,851 |
|
|
$ |
(180,798 |
) |
|
$ |
55,053 |
|
|
|
7.0 |
|
Customer relationships |
|
296,868 |
|
|
|
(191,037 |
) |
|
|
105,831 |
|
|
|
11.7 |
|
Trademarks and trade names |
|
25,261 |
|
|
|
(18,396 |
) |
|
|
6,865 |
|
|
|
9.3 |
|
Amortizable intangible assets |
|
557,980 |
|
|
|
(390,231 |
) |
|
|
167,749 |
|
|
|
10.0 |
|
Non-amortizable intangible assets: |
|
|
|
|
|
|
|
|
|
|
|
||||
Trade names |
|
13,027 |
|
|
|
— |
|
|
|
13,027 |
|
|
|
|
|
Total |
$ |
571,007 |
|
|
$ |
(390,231 |
) |
|
$ |
180,776 |
|
|
|
|
|
|
December 31, 2024 |
|
|||||||||||||
|
Gross Carrying |
|
|
Accumulated |
|
|
Net Carrying |
|
|
Weighted Average Remaining Life (Years) |
|
||||
Amortizable intangible assets: |
|
|
|
|
|
|
|
|
|
|
|
||||
Patents and developed technologies |
$ |
218,867 |
|
|
$ |
(159,041 |
) |
|
$ |
59,826 |
|
|
|
7.6 |
|
Customer relationships |
|
265,156 |
|
|
|
(158,938 |
) |
|
|
106,218 |
|
|
|
13.2 |
|
Trademarks and trade names |
|
23,367 |
|
|
|
(16,594 |
) |
|
|
6,773 |
|
|
|
9.2 |
|
Amortizable intangible assets |
|
507,390 |
|
|
|
(334,573 |
) |
|
|
172,817 |
|
|
|
11.1 |
|
Non-amortizable intangible assets: |
|
|
|
|
|
|
|
|
|
|
|
||||
Trade names |
|
13,027 |
|
|
|
— |
|
|
|
13,027 |
|
|
|
|
|
Total |
$ |
520,417 |
|
|
$ |
(334,573 |
) |
|
$ |
185,844 |
|
|
|
|
|
All definite-lived intangible assets are amortized either on a straight-line basis or an economic benefit basis over their remaining estimated useful life. Amortization expense for patents and developed technologies is included in cost of revenue in the accompanying consolidated statements of operations. Amortization expense for customer relationships and definite-lived trademarks, trade names and other intangibles is included in operating expenses in the accompanying consolidated statements of operations. Amortization expense for the periods presented was as follows (in thousands):
|
Year Ended December 31, |
|
|||||||||
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Amortization expense – cost of revenue |
$ |
16,276 |
|
|
$ |
14,773 |
|
|
$ |
12,150 |
|
Amortization expense – operating expenses |
|
27,477 |
|
|
|
25,794 |
|
|
|
20,445 |
|
Total amortization expense |
$ |
43,753 |
|
|
$ |
40,567 |
|
|
$ |
32,595 |
|
Estimated future amortization expense for each of the five succeeding years and thereafter is as follows (in thousands):
Year Ending December 31, |
|
Cost of |
|
|
Operating |
|
|
Total |
|
|||
2026 |
|
$ |
15,044 |
|
|
$ |
23,111 |
|
|
$ |
38,155 |
|
2027 |
|
|
12,118 |
|
|
|
19,263 |
|
|
|
31,381 |
|
2028 |
|
|
10,311 |
|
|
|
16,221 |
|
|
|
26,532 |
|
2029 |
|
|
7,440 |
|
|
|
12,616 |
|
|
|
20,056 |
|
2030 |
|
|
4,764 |
|
|
|
10,129 |
|
|
|
14,893 |
|
Thereafter |
|
|
5,376 |
|
|
|
31,356 |
|
|
|
36,732 |
|
Total |
|
$ |
55,053 |
|
|
$ |
112,696 |
|
|
$ |
167,749 |
|
Impairment Charges
The Company did not have any goodwill or indefinite-lived intangible asset impairment charges during the years ended December 31, 2025, 2024, or 2023.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 23, 2026 | Showing above |
| 2024 | Feb 25, 2025 | |
| 2023 | Feb 28, 2024 | |
| 2022 | Mar 1, 2023 | |
| 2021 | Mar 1, 2022 | |
| 2020 | Mar 1, 2021 | |
| 2019 | Feb 26, 2020 | |
| 2018 | Feb 27, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Mar 6, 2017 | |
| 2015 | Mar 2, 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.