7. Goodwill and Intangible Assets

Amortization expense associated with finite-lived intangible assets was $12.2 million and $13.2 million during the three months ended March 31, 2026 and 2025, respectively, of which $4.9 million and $5.3 million was included in cost of revenue during each respective period.

Goodwill Impairment

Goodwill and acquired intangible assets are initially recorded at fair value and tested periodically for impairment. The Company estimates the fair value of these assets using primarily unobservable inputs, which are considered Level 3 fair value measurements as defined in Note 11. Fair Value Measurements. The Company traditionally performs an impairment test of goodwill during the fourth quarter of each fiscal year and more frequently if indicators of potential impairment arise.

During the first quarter of 2026, the Company experienced declines in its market capitalization as a result of sustained decreases in the Company’s stock price, which represented a triggering event requiring management to perform a quantitative goodwill impairment test as of the end of the reporting period. As a result of the impairment test, the Company determined that the fair value of its single reporting unit was lower than its carrying value and, accordingly, recorded a non-cash, pretax, goodwill impairment charge of $197.2 million during the three months ended March 31, 2026. The goodwill impairment charge did not affect the Company’s liquidity or the financial covenants in its outstanding debt agreement.

In calculating the goodwill impairment charges, the Company estimated the fair value of its single reporting unit based on its market capitalization and an appropriate control premium. Market capitalization is determined by multiplying the number of shares of Class A common stock outstanding by the market price of its Class A common stock. The control premium, or the amount paid by a new controlling shareholder for the benefits resulting from synergies and other potential benefits derived from controlling the acquired company, is determined by utilizing data from publicly available premium studies for similarly situated public company transactions. A goodwill impairment loss is recognized for the difference between the carrying value of the reporting unit and the fair value.

The Company also recorded a non-cash, pretax, goodwill impairment charge of $176.5 million during the three months ended March 31, 2025 based on a triggering event driven by declines in its market capitalization as a result of sustained decreases in the Company’s stock price.

The Company also considered its intangible assets with finite useful lives, which are amortized over their estimated useful lives, generally on a straight-line basis or using the economic consumption method if anticipated future revenues can be reasonably estimated. These assets are reviewed for impairment when facts or circumstances indicate that the carrying values may not be recoverable. The Company experienced triggering events during the three months ended March 31, 2026 and 2025 resulting from declines in the Company’s market capitalization driven by sustained decreases in the Company’s stock price. In each case, the Company’s intangible assets were reviewed for impairment. Based on quantitative and qualitative analyses performed, management concluded the assets were recoverable and no impairment charges were recorded as a result of these triggering events.