Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets, Net and Goodwill

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Intangible Assets, Net and Goodwill
6 Months Ended
Jun. 30, 2014
Goodwill and Intangible Assets Disclosure [Abstract]  
Intangible Assets, Net and Goodwill
INTANGIBLE ASSETS, NET AND GOODWILL
Intangible assets that are determined to have finite lives include patents, purchased technology, customer relationships and order backlog and are amortized over their estimated useful lives, which range from less than one year to approximately 10 years, and are measured for impairment only when events or circumstances indicate the carrying value may be impaired. Goodwill and intangible assets with indefinite useful lives, including trademarks and trade names, are not amortized but are periodically evaluated for impairment.
Intangible assets
The following table summarizes the Company’s identifiable intangible assets balance (in thousands):
 
June 30,
2014
 
December 31,
2013
 
June 30,
2013
Intangible assets subject to amortization:
 
 
 
 
 
Patents and purchased technology
$
14,198

 
$
14,198

 
$
14,198

Customer relationships
23,000

 

 

Order backlog
3,500

 

 

Gross carrying amount
40,698

 
14,198

 
14,198

Accumulated amortization:
 
 
 
 
 
Patents and purchased technology
(5,997
)
 
(5,331
)
 
(4,667
)
Customer relationships
(318
)
 

 

Order backlog
(583
)
 

 

Total accumulated amortization
(6,898
)
 
(5,331
)
 
(4,667
)
Net carrying amount
33,800

 
8,867

 
9,531

Intangible assets not subject to amortization
115,421

 
27,421

 
27,421

Intangible assets, net
$
149,221

 
$
36,288

 
$
36,952


Amortization expense for intangible assets subject to amortization was $1,234,000 and $333,000 for the three months ended June 30, 2014 and 2013, respectively, and was $1,567,000 and $665,000 for the six months ended June 30, 2014 and 2013, respectively. Annual amortization expense is estimated to be $7,056,000 in 2014, $5,147,000 in 2015 and 2016, $3,883,000 in 2017 and $2,980,000 in 2018.
Goodwill
Goodwill was $69,257,000 at June 30, 2014, and $14,438,000 at December 31, 2013 and June 30, 2013. The change in goodwill is related to the acquisition of prAna on May 30, 2014 (see Note 3).