NOTE 6. GOODWILL AND INTANGIBLE ASSETS

Goodwill

Goodwill by segment as of December 31, 2025 was as follows:

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Goodwill by segment as of December 31, 2024 was as follows:

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The following table summarizes the changes in goodwill by segment:

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Due to challenging market conditions and other factors affecting the demand for our Adventure reporting unit products, we experienced significant declining revenue and profitability in our Adventure reporting unit and a sustained decline in our stock price during the years ended December 31, 2025 and 2024. As part of our annual impairment tests as of December 31, 2025 and 2024, we performed quantitative assessments using income-based and market-based approaches. As a result of these assessments, the carrying value of our Adventure reporting unit exceeded the related estimated fair value, thus impairments of goodwill of $3,804 and $36,264 were recorded during the years ended December 31, 2025 and 2024, respectively.

Indefinite-Lived Intangible Assets

The following table summarizes the changes in indefinite-lived intangible assets:

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Management performs an indefinite-lived intangible asset impairment assessment whenever events or circumstances make it more likely than not that an impairment may have occurred, such as a significant adverse change in the business climate or a decision to sell or dispose of the asset. If the carrying value of the indefinite-lived asset is higher than its fair value, the asset is deemed to be impaired and the impairment charge is estimated as the difference.  

The Company calculates the fair value of its indefinite-lived intangible assets using the income approach, specifically the relief-from-royalty method. The relief-from-royalty method is used to estimate the cost savings that accrue to the owner of an intangible asset who would otherwise have to pay royalties or license fees on revenues earned through the use of the asset. Internally forecasted revenues, which the Company believes reasonably approximate market participant assumptions, are multiplied by a royalty rate to arrive at the estimated net after tax cost savings. The royalty rate used in the analysis is based on an analysis of empirical, market-derived royalty rates for comparable intangible assets. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view. The discount rates are consistent with those used for investment decisions and take into account our future operating plans and strategies.

We determined that a triggering event had occurred during the quarter ended June 30, 2025, with respect to certain indefinite-lived intangible assets within our Outdoor reporting unit, which required that we perform a quantitative assessment. We assessed the fair value of the specific indefinite-lived intangible assets using the relief-from-royalty method described above. As a result of this assessment, the carrying value of the PIEPS trademark recorded within our Outdoor reporting unit exceeded its estimated related fair value, thus an impairment of the PIEPS trademark of $1,565 was recorded in the second quarter during the year ended December 31, 2025.

As part of our annual impairment tests as of December 31, 2025 and 2024, we performed quantitative assessments using the relief-from-royalty method. As a result of these assessments, the carrying value of the Rhino-Rack and MAXTRAX trademarks recorded within our Adventure reporting unit exceeded their estimated related fair values, thus impairments of the Rhino-Rack and MAXTRAX trademarks of $21,600 and $4,469, respectively, during the year ended December 31, 2025, and $3,480 and $5,065, respectively, during the year ended December 31, 2024, were recorded.

If we do not achieve the results reflected in the forecasts utilized in our impairment assessments, or if there are changes to market assumptions, all of which require significant estimates and assumptions, our valuation of the reporting unit, including related indefinite-lived intangible assets, could be adversely affected, and we may be required to impair an additional portion or all of the indefinite-lived intangibles and other long-lived assets which could adversely affect our operating results in the period of impairment.

Trademarks classified as indefinite-lived intangible assets by brand as of December 31, 2025 and 2024, were as follows:

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Other Intangible Assets, net

The following table summarizes the changes in gross other intangible assets:

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Other intangible assets, net of amortization as of December 31, 2025 and 2024, were as follows:

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Amortization expense for continuing operations for the years ended December 31, 2025, 2024, and 2023, was $8,740, $9,784, and $10,715, respectively. Future amortization expense for other intangible assets as of December 31, 2025 is as follows:

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