colm-20220630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



			FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from_______to_______

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Commission file number 000-23939

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COLUMBIA SPORTSWEAR COMPANY

(Exact name of registrant as specified in its charter)

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Oregon		93-0498284
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)
14375 Northwest Science Park Drive, Portland Oregon 97229
	(Address of principal executive offices and zip code)
	(503) 985-4000
	(Registrant's telephone number, including area code)

—————————————————————



Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	COLM	The NASDAQ Global Select Market

—————————————————————

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

☒

☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes

☒

☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes

☐

☒

The number of shares outstanding of the registrant's common stock on July 22, 2022 was 62,091,183.


TABLE OF CONTENTS


		Page
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS








PART I — FINANCIAL INFORMATION
Item 1.	Financial Statements and Supplementary Data	1
	Condensed Consolidated Balance Sheets (Unaudited)	1
	Condensed Consolidated Statements of Operations (Unaudited)	2
	Condensed Consolidated Statements of Comprehensive Income (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows (Unaudited)	4
	Condensed Consolidated Statements of Equity (Unaudited)	5
	Notes to Condensed Consolidated Financial Statements (Unaudited)	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33
















PART II — OTHER INFORMATION
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 6.	Exhibits	47
	Signatures	48

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q


Table of Contents


SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report contains forward-looking statements within the meaning of federal securities laws. Forward-looking statements often use words such as "will", "anticipate", "estimate", "expect", "should", "may" and other words and terms of similar meaning or reference future dates. Forward-looking statements include any statements related to our expectations regarding the effectiveness of our investments, future performance or market position, including any statements regarding outdoor participation and a move to casualization by consumers, the promotional environment, wholesale trade terms, inventories, shipping timing, consumer spending and preferences, store traffic, freight charges, product input costs, scale efficiencies, inventory receipts, logistics constraints, manufacturing constraints, labor costs and shortages, inflationary pressures, foreign currency translation, the geopolitical environment, consumer expectations, the impact of seasonal trends, our short and long-term cash needs and our ability to meet those needs, amortization expenses and maturities of liabilities.

These forward-looking statements, and others we make from time to time expressed in good faith, are believed to have a reasonable basis; however, each forward-looking statement involves risks and uncertainties. Many factors may cause actual results to differ materially from projected results in forward-looking statements, including the risks described in Part II, Item 1A of this Quarterly Report on Form 10-Q. Forward-looking statements are inherently less reliable than historical information. Except as required by law, we do not undertake any duty to update forward-looking statements after the date they are made or to conform them to actual results or to changes in circumstances or to reflect changes in events, circumstances or expectations. New factors emerge from time to time and it is not possible for us to predict or assess the effects of all such factors or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | i


Table of Contents


PART I — FINANCIAL INFORMATION


ITEM 1.			FINANCIAL STATEMENTS


CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)



(in thousands)	June 30, 2022		December 31, 2021		June 30, 2021
ASSETS
Current Assets:
Cash and cash equivalents	$	413,110	$	763,404	$	819,806

Short-term investments	1,108		131,145		1,138
Accounts receivable, net of allowance of $4,405, $8,893 and $10,734, respectively	296,636		487,803		279,763

Inventories, net	962,875		645,379		676,009

Prepaid expenses and other current assets	121,404		86,306		102,003
Total current assets	1,795,133		2,114,037		1,878,719
Property, plant and equipment, net of accumulated depreciation of $604,233, $602,660 and $585,104, respectively	288,199		291,088		297,237

Operating lease right-of-use assets	325,871		330,928		350,798
Intangible assets, net	101,083		101,908		102,733
Goodwill	68,594		68,594		68,594
Deferred income taxes	81,263		92,121		97,746
Other non-current assets	66,645		68,452		67,472
Total assets	$	2,726,788	$	3,067,128	$	2,863,299
LIABILITIES AND EQUITY
Current Liabilities:

Accounts payable	$	312,353	$	283,349	$	267,677
Accrued liabilities	239,181		316,485		227,209
Operating lease liabilities	65,668		67,429		71,149
Income taxes payable	1,242		13,127		1,565

Total current liabilities	618,444		680,390		567,600

Non-current operating lease liabilities	312,043		317,666		344,216
Income taxes payable	32,504		44,541		48,805
Deferred income taxes	—		—		151
Other long-term liabilities	32,080		35,279		40,870
Total liabilities	995,071		1,077,876		1,001,642
Commitments and contingencies (Note 5)
Shareholders' Equity:
Preferred stock; 10,000 shares authorized; none issued and outstanding	—		—		—
Common stock (no par value); 250,000 shares authorized; 62,091, 65,164 and 66,148 issued and outstanding, respectively	—		—		—

Retained earnings	1,753,450		1,993,628		1,863,813
Accumulated other comprehensive income (loss)	(21,733)		(4,376)		(2,156)
Total shareholders' equity	1,731,717		1,989,252		1,861,657
Total liabilities and shareholders' equity	$	2,726,788	$	3,067,128	$	2,863,299

See accompanying notes to condensed consolidated financial statements.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 1


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands, except per share amounts)	2022		2021		2022		2021
Net sales	$	578,063	$	566,370	$	1,339,573	$	1,191,976
Cost of sales	293,903		273,853		676,966		578,057
Gross profit	284,160		292,517		662,607		613,919
Selling, general and administrative expenses	281,258		261,766		580,344		516,155
Net licensing income	5,871		4,244		10,176		7,711
Operating income	8,773		34,995		92,439		105,475
Interest income, net	499		598		894		876
Other non-operating expense, net	(1,435)		(294)		(1,391)		(598)
Income before income tax	7,837		35,299		91,942		105,753
Income tax benefit (expense)	(674)		5,385		(17,942)		(9,169)
Net income	$	7,163	$	40,684	$	74,000	$	96,584

Earnings per share:
Basic	$	0.11	$	0.61	$	1.17	$	1.46
Diluted	$	0.11	$	0.61	$	1.16	$	1.44
Weighted average shares outstanding:
Basic	62,554		66,327		63,409		66,345
Diluted	62,695		66,787		63,654		66,858

See accompanying notes to condensed consolidated financial statements.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 2


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2022		2021		2022		2021
Net income	$	7,163	$	40,684	$	74,000	$	96,584
Other comprehensive income (loss):
Unrealized gains on available-for-sale securities (net of tax effects of $(146))	451		—		—		—
Unrealized gains (losses) on derivative transactions (net of tax effects of $(5,744), $1,183, $(5,088) and $(2,185), respectively)	15,808		(3,551)		13,717		5,012



Foreign currency translation adjustments (net of tax effects of $147, $(265), $997 and $149, respectively)	(28,818)		5,230		(31,074)		(7,974)



Other comprehensive income (loss)	(12,559)		1,679		(17,357)		(2,962)
Comprehensive income (loss)	$	(5,396)	$	42,363	$	56,643	$	93,622

See accompanying notes to condensed consolidated financial statements.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 3


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)


	Six Months Ended June 30,
(in thousands)	2022		2021
Cash flows from operating activities:
Net income	$	74,000	$	96,584
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation, amortization, and non-cash lease expense	58,537		60,962
Provision for uncollectible accounts receivable	(4,047)		(9,757)
Loss on disposal or impairment of investments, property, plant and equipment, and right-of-use assets	2,418		201
Deferred income taxes	3,750		(9,667)
Stock-based compensation	10,636		9,823
Changes in operating assets and liabilities:
Accounts receivable	186,364		180,456
Inventories, net	(332,225)		(123,737)
Prepaid expenses and other current assets	(23,226)		(48,160)
Other assets	3,018		(337)
Accounts payable	35,754		59,085
Accrued liabilities	(67,199)		(30,130)
Income taxes payable	(23,807)		(22,652)
Operating lease assets and liabilities	(34,478)		(47,436)
Other liabilities	(2,163)		1,927
Net cash provided by (used in) operating activities	(112,668)		117,162
Cash flows from investing activities:
Purchases of short-term investments	(44,877)		—
Sales and maturities of short-term investments	175,725		1,184
Capital expenditures	(28,983)		(12,387)

Net cash provided by (used in) investing activities	101,865		(11,203)
Cash flows from financing activities:
Proceeds from credit facilities	—		19,888
Repayments on credit facilities	—		(19,683)

Proceeds from issuance of common stock related to stock-based compensation	4,076		20,287
Tax payments related to stock-based compensation	(4,024)		(5,440)
Repurchase of common stock	(287,443)		(54,500)

Cash dividends paid	(37,926)		(34,540)
Net cash used in financing activities	(325,317)		(73,988)
Net effect of exchange rate changes on cash	(14,174)		(2,890)
Net increase (decrease) in cash and cash equivalents	(350,294)		29,081
Cash and cash equivalents, beginning of period	763,404		790,725
Cash and cash equivalents, end of period	$	413,110	$	819,806
Supplemental disclosures of cash flow information:
Cash paid during the year for income taxes	$	47,846	$	81,497
Supplemental disclosures of non-cash investing and financing activities:
Property, plant and equipment acquired through increase in liabilities	$	5,334	$	4,268

See accompanying notes to condensed consolidated financial statements.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 4


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited)



(in thousands, except per share amounts)	Common Stock			Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total
	Shares Outstanding	Amount
Balance, March 31, 2022	62,948	$	—	$	1,828,074	$	(9,174)	$	1,818,900
Net income	—	—		7,163		—		7,163

Other comprehensive income (loss):
Unrealized gains on available-for-sale securities, net	—	—		—		451		451
Unrealized gains on derivative transactions, net	—	—		—		15,808		15,808
Foreign currency translation adjustment, net	—	—		—		(28,818)		(28,818)
Cash dividends ($0.30 per share)	—	—		(18,775)		—		(18,775)
Issuance of common stock related to stock-based compensation, net	49	1,498		—		—		1,498
Stock-based compensation expense	—	5,133		—		—		5,133
Repurchase of common stock	(906)	(6,631)		(63,012)		—		(69,643)
Balance, June 30, 2022	62,091	$	—	$	1,753,450	$	(21,733)	$	1,731,717



(in thousands, except per share amounts)	Common Stock			Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total
	Shares Outstanding	Amount
Balance, March 31, 2021	66,457	$	22,230	$	1,850,415	$	(3,835)	$	1,868,810
Net income	—	—		40,684		—		40,684

Other comprehensive income (loss):

Unrealized losses on derivative transactions, net	—	—		—		(3,551)		(3,551)
Foreign currency translation adjustment, net	—	—		—		5,230		5,230
Cash dividends ($0.26 per share)	—	—		(17,255)		—		(17,255)
Issuance of common stock related to stock-based compensation, net	110	6,433		—		—		6,433
Stock-based compensation expense	—	4,949		—		—		4,949
Repurchase of common stock	(419)	(33,612)		(10,031)		—		(43,643)
Balance, June 30, 2021	66,148	$	—	$	1,863,813	$	(2,156)	$	1,861,657



(in thousands, except per share amounts)	Common Stock			Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total
	Shares Outstanding	Amount
Balance, December 31, 2021	65,164	$	—	$	1,993,628	$	(4,376)	$	1,989,252
Net income	—	—		74,000		—		74,000

Other comprehensive income (loss):

Unrealized gains on derivative transactions, net	—	—		—		13,717		13,717
Foreign currency translation adjustment, net	—	—		—		(31,074)		(31,074)
Cash dividends ($0.60 per share)	—	—		(37,926)		—		(37,926)
Issuance of common stock related to stock-based compensation, net	162	52		—		—		52
Stock-based compensation expense	—	10,636		—		—		10,636
Repurchase of common stock	(3,235)	(10,688)		(276,252)		—		(286,940)
Balance, June 30, 2022	62,091	$	—	$	1,753,450	$	(21,733)	$	1,731,717

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 5


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)



(in thousands, except per share amounts)	Common Stock			Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total
	Shares Outstanding	Amount
Balance, December 31, 2020	66,252	$	20,165	$	1,811,800	$	806	$	1,832,771
Net income	—	—		96,584		—		96,584

Other comprehensive income (loss):

Unrealized gains on derivative transactions, net	—	—		—		5,012		5,012
Foreign currency translation adjustment, net	—	—		—		(7,974)		(7,974)
Cash dividends ($0.52 per share)	—	—		(34,540)		—		(34,540)
Issuance of common stock related to stock-based compensation, net	424	14,847		—		—		14,847
Stock-based compensation expense	—	9,823		—		—		9,823
Repurchase of common stock	(528)	(44,835)		(10,031)		—		(54,866)
Balance, June 30, 2021	66,148	$	—	$	1,863,813	$	(2,156)	$	1,861,657

See accompanying notes to condensed consolidated financial statements.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 6


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

NOTE

PAGE

Note 1

Basis of Presentation and Organization

Note 2

Revenues

Note 3

Intangible Assets, Net and Goodwill

Note 4

Short-Term Borrowings and Credit Lines

Note 5

Commitments and Contingencies

Note 6

Shareholders' Equity

Note 7

Stock-Based Compensation

Note 8

Earnings Per Share

Note 9

Accumulated Other Comprehensive Income (Loss)

Note 10

Segment Information

Note 11

Financial Instruments and Risk Management

Note 12

Fair Value Measures

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 7


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


NOTE 1 — BASIS OF PRESENTATION AND ORGANIZATION

The accompanying unaudited condensed consolidated financial statements have been prepared by the management of Columbia Sportswear Company (together with its wholly owned subsidiaries, the "Company") and, in the opinion of management, include all normal recurring material adjustments necessary to present fairly the Company's financial position as of June 30, 2022, December 31, 2021 and June 30, 2021, the results of operations for the three and six months ended June 30, 2022 and 2021, and cash flows for the six months ended June 30, 2022 and 2021. The December 31, 2021 financial information was derived from the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021. A significant part of the Company's business is of a seasonal nature; therefore, results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of results to be expected for other quarterly periods or for the full year.

Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. The Company, however, believes that the disclosures contained in this report comply with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended, for a Quarterly Report on Form 10-Q and are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

PRINCIPLES OF CONSOLIDATION

The unaudited condensed consolidated financial statements include the accounts of the Company. All significant intercompany balances and transactions have been eliminated in consolidation.

ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates and assumptions. The Company's significant estimates relate to sales reserves, allowance for uncollectible accounts receivable, excess, close-out and slow-moving inventory, impairment of long-lived assets, intangible assets and goodwill, and income taxes.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

None.

RECENT ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

In November 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2021-10 (“ASU 2021-10”), Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance, to increase transparency of government assistance including the disclosure of (1) the types of assistance, (2) an entity’s accounting for the assistance, and (3) the effect of the assistance on an entity’s financial statements. ASU 2021-10 is effective for annual periods beginning after December 15, 2021. Early adoption is permitted. The impact of this new standard will depend on the amount of future government assistance received, if any.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 8


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


NOTE 2 — REVENUES

DISAGGREGATED REVENUE

As disclosed below in Note 10, the Company has four geographic reportable segments: United States ("U.S."), Latin America and Asia Pacific ("LAAP"), Europe, Middle East and Africa ("EMEA") and Canada.

The following tables disaggregate the Company's operating segment Net sales by product category and channel, which the Company believes provides a meaningful depiction of how the nature, timing, and uncertainty of Net sales are affected by economic factors:


	Three Months Ended June 30, 2022
(in thousands)	U.S.		LAAP		EMEA		Canada		Total
Product category net sales
Apparel, Accessories and Equipment	$	348,592	$	54,379	$	37,542	$	27,805	$	468,318
Footwear	63,893		18,446		20,000		7,406		109,745
Total	$	412,485	$	72,825	$	57,542	$	35,211	$	578,063
Channel net sales
Wholesale	$	201,880	$	28,308	$	47,259	$	22,449	$	299,896
Direct-to-consumer	210,605		44,517		10,283		12,762		278,167
Total	$	412,485	$	72,825	$	57,542	$	35,211	$	578,063


	Three Months Ended June 30, 2021
(in thousands)	U.S.		LAAP		EMEA		Canada		Total
Product category net sales
Apparel, Accessories and Equipment	$	316,896	$	56,038	$	64,518	$	15,598	$	453,050
Footwear	62,169		21,937		24,056		5,158		113,320
Total	$	379,065	$	77,975	$	88,574	$	20,756	$	566,370
Channel net sales
Wholesale	$	176,187	$	32,069	$	80,552	$	13,495	$	302,303
Direct-to-consumer	202,878		45,906		8,022		7,261		264,067
Total	$	379,065	$	77,975	$	88,574	$	20,756	$	566,370


	Six Months Ended June 30, 2022
(in thousands)	U.S.		LAAP		EMEA		Canada		Total
Product category net sales
Apparel, Accessories and Equipment	$	733,820	$	140,304	$	100,811	$	59,326	$	1,034,261
Footwear	180,559		54,264		51,448		19,041		305,312
Total	$	914,379	$	194,568	$	152,259	$	78,367	$	1,339,573
Channel net sales
Wholesale	$	449,389	$	88,246	$	122,553	$	47,932	$	708,120
Direct-to-consumer	464,990		106,322		29,706		30,435		631,453
Total	$	914,379	$	194,568	$	152,259	$	78,367	$	1,339,573

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 9


Table of Contents Notes to Condensed Consolidated Financial Statements (Unaudited)


	Six Months Ended June 30, 2021
(in thousands)	U.S.		LAAP		EMEA		Canada		Total
Product category net sales
Apparel, Accessories and Equipment	$	634,245	$	134,761	$	110,814	$	42,140	$	921,960
Footwear	153,482		55,191		48,525		12,818		270,016
Total	$	787,727	$	189,952	$	159,339	$	54,958	$	1,191,976
Channel net sales
Wholesale	$	377,068	$	87,619	$	138,316	$	34,713	$	637,716
Direct-to-consumer	410,659		102,333		21,023		20,245		554,260
Total	$	787,727	$	189,952	$	159,339	$	54,958	$	1,191,976

PERFORMANCE OBLIGATIONS

For the three and six months ended June 30, 2022 and 2021, Net sales recognized from performance obligations related to prior periods were not material. Net sales expected to be recognized in any future period related to remaining performance obligations is not material.

CONTRACT BALANCES

As of June 30, 2022, December 31, 2021 and June 30, 2021, contract liabilities included in Accrued liabilities on the unaudited Condensed Consolidated Balance Sheets, which consisted of obligations associated with the Company's gift card and customer loyalty programs, were not material.


NOTE 3 — INTANGIBLE ASSETS, NET AND GOODWILL

Intangible assets, net consisted of the following:



(in thousands)	June 30, 2022		December 31, 2021		June 30, 2021
Intangible assets with definite lives:
Patents and purchased technology	$	14,198	$	14,198	$	14,198
Customer relationships	23,000		23,000		23,000
Gross carrying amount	37,198		37,198		37,198
Accumulated amortization:
Patents and purchased technology	(14,198)		(14,198)		(14,198)
Customer relationships	(19,838)		(19,013)		(18,188)
Accumulated amortization	(34,036)		(33,211)		(32,386)