NOTE 5 - GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

Goodwill is accounted for in accordance with ASC 350, Intangibles - Goodwill and Other, which requires that goodwill is not amortized but tested for impairment at least annually and more frequently if events or changes in circumstances indicate that the carrying value may not be recoverable. The Company performs its goodwill impairment testing using appropriate valuation methods, such as discounted cash flow analysis and market approach techniques, consistent with ASC 350 guidance. Impairment charges, if any, are recognized in the consolidated statements of operations as a non-cash expense, and the carrying value of goodwill is adjusted accordingly.

As of December 31, 2024, the Company determined that the carrying value of its online recruiting reporting unit exceeded its estimated fair value under the market approach. As a result, the Company recorded a non-cash goodwill impairment charge of $4.7 million in the consolidated statements of operations. The impairment was primarily driven by a decline in revenue from the Company's online recruiting platform, which reduced the estimated fair value under the market-based revenue multiple analysis. Following this impairment, the goodwill carrying value associated with continuing operations was reduced to $1.7 million as of December 31, 2024.

For the year ended December 31, 2025, the Company performed the goodwill impairment assessment and concluded that the remaining goodwill associated with the Company's legacy online recruiting operations, which no longer represent part of the Company’s core business following the spin-off of the recruiting business, should be fully impaired. Accordingly, the Company recorded a non-cash goodwill impairment charge of $1.7 million.

As a result of this impairment, the carrying value of goodwill was reduced to $0 as of December 31, 2025.

Intangible Assets

Intangible assets consist primarily of software platforms, telecommunications billing systems, artificial intelligence technologies, licenses, domains, and other intellectual property acquired through asset acquisitions and licensing agreements. Intangible assets with finite lives are amortized on a straight-line basis over their estimated useful lives, generally ranging from three to ten years, in accordance with ASC 350, Intangibles – Goodwill and Other.

GOLQ License

On February 23, 2024, the Company entered into a certain Technology License and Commercialization Agreement with GoLogiq, Inc. (the “GOLQ”) that supersedes and replaces in its entirety the GOLQ Agreement, as amended by the August 29, 2023, Amendment and the August 18, 2023, Amendment. Under the GOLQ Licensing Agreement, GOLQ grants the Company a worldwide, exclusive license to the Company to develop its fintech technology and sell products derived thereof, including its Createapp, Paylogiq, Gologiq, and Radix AI technology and products, for a term of 10 years, with automatic two-year renewals.

On March 7, 2024, the Company appointed the CEO and Director of GOLQ to be the new Chief Executive Officer and President. On December 21, 2024, he resigned from his position as member of the Board of Directors of Nixxy, Inc. His resignation was not due to any disagreement with the Company (See Note 11).

On March 28, 2024, the Company and GOLQ entered into an Amendment to the Technology License and Commercialization Agreement to decrease the future royalty from eight percent to five percent for which the Company agreed to grant GOLQ a warrant to purchase 292,000 shares of Company common stock for a price equal to $0.01 per share. As a result of this transaction the company issued GOLQ 392,155 shares of the Company’s common stock valued at $647 thousand, based on the quoted trading price on the grant date, and warrant to purchase 292,000 shares of Company’s common stock valued at $480 thousand based on the Black-Scholes option pricing model.

As of March 31, 2026, the total cost basis in the intangible assets purchased from GoLogiq is $1.1 million with accumulated amortization of $803 thousand and a net carrying value of $325 thousand.

Savitr Tech Systems

On February 20, 2025, the Company acquired telecommunications billing and AI-integrated software systems from Savitr Tech OU, an Estonia-based telecommunications technology company.

The purchase price totaled $2.3 million, consisting of $300 thousand in cash and two tranches of equity consideration totaling up to 9.8% of the Company’s outstanding shares, contingent on revenue milestones.

On March 31, 2025, the Company issued 755,407 shares of its common stock valued at approximately $1.4 million as the first tranche of equity consideration. The Company initially recorded a contingent consideration liability of $605 thousand for the remaining equity obligation. During the year ended December 31, 2025, the Company recorded a $1.2 million loss related to changes in the fair value of the contingent consideration, and the liability was reduced to $0 upon settlement. The transaction was accounted for as an asset acquisition under ASC 805, as substantially all of the fair value of the acquired assets was concentrated in identifiable customer telecommunications contracts.

As of March 31, 2026, the total cost basis in the intangible asset purchased from Savitr is $2.3 million with an accumulated amortization of $518 thousand and a net carrying value of $1.8 million.

Aqua Software System

On March 28, 2025, the Company acquired certain telecommunications billing systems and AI software assets from Aqua Software Technologies Inc., a Canadian telecommunications software company.

The purchase price consisted of $100 thousand in cash and $3.8 million, payable in the form of 2,087,912 shares of the Company’s common stock, valued at $1.82 per share, based on the closing price on the Nasdaq Capital Market as of March 28, 2025. The acquisition was accounted for as an asset acquisition under ASC 805. The assets are amortized over an estimated five-year useful life.

As of March 31, 2026, the Aqua software assets had accumulated amortization of $786 thousand and a net carrying value of $3.1 million.

NexGenAI System

On June 3, 2025, the Company acquired certain generative AI and machine learning software technologies from NexGenAI Holding Group, Inc.

The purchase price totaled $2.3 million, payable through restricted shares of common stock issued in four installments, based on the 10-day volume-weighted average price (VWAP) preceding each issuance. Installments issued during 2025 and 2026 include:

The acquired assets are being amortized over a five-year useful life. As of March 31, 2026, the intangible assets had accumulated amortization of $372 thousand and a net carrying value of $1.9 million.

Everythink EDGE Data Center

On August 12, 2025, the Company acquired EDGE data center software infrastructure, customer telecommunications contracts, and related intellectual property from Everythink Innovation Limited.

The purchase price consisted of 2,000,000 shares of common stock, valued at $1.89 per share, and $150 thousand cash consideration payable upon future financing or cash balance conditions. The equity portion of the consideration was satisfied on August 12, 2025, when the Company issued 2,000,000 shares.

The assets are being amortized over a five-year useful life. As of March 31, 2026, the Everythink assets had accumulated amortization of $502 thousand and a net carrying value of $3.4 million.

Intangible assets from continuing operations are summarized as follows:

Amortization expense related to intangible assets from continuing operations totaled:

Estimated future amortization expense is as follows:

Impairment of Domains

During 2025, the Company determined that the Novo Group domain associated with the legacy recruiting business would no longer be used and recorded $1 thousand of impairment expense.