Goodwill and Intangible Assets
The changes in the carrying amounts of goodwill were as follows (in millions):
| | | | | | | | |
| Carrying Amount |
| Balance as of December 31, 2023 | | $ | 1,231 | |
| Goodwill acquired | | 75 | |
| Foreign currency translation adjustments | | (33) | |
| Balance as of December 31, 2024 | | $ | 1,273 | |
| Goodwill acquired | | 2,225 | |
| Foreign currency translation adjustments | | 80 | |
| Balance as of December 31, 2025 | | $ | 3,578 | |
Intangible assets, net consists of the following (in millions):
| | | | | | | | | | | | | | |
| | December 31, 2025 | December 31, 2024 |
| Developed technology | | $ | 1,316 | | | $ | 581 | |
| Customer relationships | | 238 | | | 5 | |
| Patents | | 83 | | | 83 | |
| Other | | 72 | | | 6 | |
| Intangible assets, gross | | $ | 1,709 | | | $ | 675 | |
| Less: accumulated amortization | | (588) | | | (466) | |
| Intangible assets, net | | $ | 1,121 | | | $ | 209 | |
The weighted-average useful life of the acquired developed technology for each of the years ended December 31, 2025 and 2024 was approximately five years. Amortization expense for intangible assets was approximately $120 million, $94 million and $85 million for the years ended December 31, 2025, 2024 and 2023, respectively.
The following table presents the estimated future amortization expense related to intangible assets held as of December 31, 2025 (in millions):
| | | | | |
Fiscal Period: |
| 2026 | $ | 269 | |
| 2027 | 253 | |
| 2028 | 228 | |
| 2029 | 210 | |
| 2030 | 160 | |
| Thereafter | 1 | |
| Total future amortization expense | $ | 1,121 | |
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.