Akerna Corp. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Intangible Assets, net and Goodwill

Intangible Assets, net and Goodwill	6 Months Ended
Jun. 30, 2023
Intangible Assets, net and Goodwill
Intangible Assets, net and Goodwill	Note 4 – Intangible Assets, net and Goodwill Finite-lived Intangible Assets All of our finite-lived intangible assets, including capitalized software, as of June 30, 2023 and December 31, 2022 are attributable to Ample. We did not capitalize any software development costs during the three and six months ended June 30, 2023; however, we capitalized $0.7 million and $2.2 million during the three and six months ended June 30, 2022, respectively. We performed a two step impairment test for the asset groups that had indicators of impairment during the six months ended June 30, 2023 and 2022 and while we did not record any impairments during the 2023 periods, we recorded impairments of intangible assets of $2.2 million and capitalized software of $1.0 million during the three and six months ended June 30, 2022. Each of these impairments were attributable to the Solo platform. Goodwill Non-Enterprise Reporting Unit For the three and six months ended June 30, 2023, no impairment to goodwill was recorded for our Non-Enterprise business unit as the fair value exceeded the carrying value as of June 30, 2023. All of the goodwill as of June 30, 2023 and December 31, 2022 is attributable to Ample. For the three and six months ended June 30, 2022, due primarily to declines in market valuation from December 31, 2021, we recorded impairment charges of $8.0 million and $23.5 million, respectively, of which $2.7 million and $10.7 million was attributable to Ample, $4.9 million and $11.2 million was attributable to Solo and $0.4 million and $1.6 million was attributable to Trellis. The remaining goodwill associated with Solo and Trellis was fully impaired in the second half of 2022. Enterprise Reporting Unit For the three and six months ended June 30, 2023, no impairments to goodwill were recorded for our Enterprise business unit as there was no goodwill asset present as of June 30, 2023. For the three and six months ended June 30, 2022, we recorded an impairment of goodwill of $3.9 million attributable to Viridian due primarily to declines in market valuation from December 31, 2021. All of the remaining goodwill associated with Viridian was fully impaired in the second half of 2022.

Intangible Assets, net and Goodwill

6 Months Ended

Jun. 30, 2023

Intangible Assets, net and Goodwill

Intangible Assets, net and Goodwill

Note 4 – Intangible Assets, net and Goodwill

Finite-lived Intangible Assets

All of our finite-lived intangible assets, including capitalized software, as of June 30, 2023 and December 31, 2022 are attributable to Ample. We did not capitalize any software development costs during the three and six months ended June 30, 2023; however, we capitalized $0.7 million and $2.2 million during the three and six months ended June 30, 2022, respectively.

We performed a two step impairment test for the asset groups that had indicators of impairment during the six months ended June 30, 2023 and 2022 and while we did not record any impairments during the 2023 periods, we recorded impairments of intangible assets of $2.2 million and capitalized software of $1.0 million during the three and six months ended June 30, 2022. Each of these impairments were attributable to the Solo platform.

Goodwill

Non-Enterprise Reporting Unit

For the three and six months ended June 30, 2023, no impairment to goodwill was recorded for our Non-Enterprise business unit as the fair value exceeded the carrying value as of June 30, 2023. All of the goodwill as of June 30, 2023 and December 31, 2022 is attributable to Ample. For the three and six months ended June 30, 2022, due primarily to declines in market valuation from December 31, 2021, we recorded impairment charges of $8.0 million and $23.5 million, respectively, of which $2.7 million and $10.7 million was attributable to Ample, $4.9 million and $11.2 million was attributable to Solo and $0.4 million and $1.6 million was attributable to Trellis. The remaining goodwill associated with Solo and Trellis was fully impaired in the second half of 2022.

Enterprise Reporting Unit

For the three and six months ended June 30, 2023, no impairments to goodwill were recorded for our Enterprise business unit as there was no goodwill asset present as of June 30, 2023. For the three and six months ended June 30, 2022, we recorded an impairment of goodwill of $3.9 million attributable to Viridian due primarily to declines in market valuation from December 31, 2021. All of the remaining goodwill associated with Viridian was fully impaired in the second half of 2022.