Yahoo 2009 Annual Report Download - page 89

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Yahoo! Inc.
Notes to Consolidated Financial Statements—(Continued)
Note 5 G
OODWILL
The changes in the carrying amount of goodwill for the years ended December 31, 2008 and 2009 were as
follows (in thousands):
U.S.(1) International(2)(3) Total
Net balance as of January 1, 2008 ............................ $2,518,848 $1,483,182 $4,002,030
Acquisitions and other(4) .................................... 68,043 37,342 105,385
Goodwill impairment charge ................................ — (487,537) (487,537)
Foreign currency translation adjustments ...................... — (178,989) (178,989)
Net balance as of December 31, 2008 ..................... 2,586,891 853,998 3,440,889
Acquisitions ............................................. 10,678 148,406 159,084
Foreign currency translation adjustments ...................... — 40,400 40,400
Net balance as of December 31, 2009 ..................... $2,597,569 $1,042,804 $3,640,373
(1) Gross goodwill balances for the U.S. segment were $2.5 billion and $2.6 billion as of January 1, 2008 and
December 31, 2009, respectively.
(2) Gross goodwill balances for the International segment were $1.5 billion and $1.6 billion as of January 1,
2008 and December 31, 2009, respectively.
(3) International segment includes accumulated impairment losses of $64 million and $552 million as of
January 1, 2008 and December 31, 2009, respectively.
(4) Other includes a reduction of $19 million of goodwill related to the sale of Kelkoo SAS.
In 2008, as a result of the goodwill impairment test, the Company concluded that the carrying value of the
European reporting unit, included in the International segment, exceeded its fair value. Accordingly, the
Company recorded a goodwill impairment charge of approximately $488 million during 2008 for the difference
between the carrying value of the goodwill in the reporting unit and its implied fair value. The fair values of the
other reporting units exceeded their estimated carrying values so goodwill in those reporting units was not
impaired. The impairment resulted from a combination of factors, including the global economic downturn, a
persistent decline in business conditions in the European region, reductions in the Company’s projected operating
results and estimated future cash flows, and decreases in revenues and earnings multiples of comparable
companies in that region. The 2009 impairment test indicated that the fair value of the reporting units
substantially exceeded their carrying values; therefore goodwill in the reporting units was not impaired.
Note 6 I
NTANGIBLE
A
SSETS
,N
ET
The following table summarizes the Company’s carrying amount of intangible assets, net (in thousands):
December 31, 2008
Gross Carrying
Amount
Accumulated
Amortization(*) Net
Customer, affiliate, and advertiser related relationships ........... $178,868 $ (79,040) $ 99,828
Developed technology and patents ............................ 555,669 (205,501) 350,168
Trade names, trademarks, and domain names ................... 128,190 (92,326) 35,864
Total intangible assets, net .............................. $862,727 $(376,867) $485,860
81