Following the commencement of regular-way trading of the Company’s Class B Ordinary Shares, the Company’s market capitalization remained below the Company’s carrying value. Management considered the market capitalization, together with current capital market conditions, to be a triggering event requiring an interim goodwill impairment assessment as of June 30, 2026.

As a result, the Company performed a quantitative goodwill impairment test by comparing the carrying amount of its single reporting unit to its estimated fair value. The Company’s estimated fair value was determined using a combination of income and market approaches. The income approach consisted of a discounted cash flow analysis which required judgment in developing projections about future revenue growth, operating margins, capital expenditures, and the appropriate discount rate, all of which serve as key assumptions. The market approaches included guideline public company and guideline transaction methods, as well as consideration of the Company’s observed market capitalization as of June 30, 2026.

To corroborate the Company’s estimated fair value, a reconciliation to the Company’s market capitalization as of June 30, 2026 was performed and concluded that the implied control premium was reasonable as compared to relevant market transactions in similar industries.

Based on the results of the quantitative goodwill impairment test, the carrying amount of the Company’s single reporting unit exceeded its estimated fair value. Accordingly, the Company recognized a non-cash goodwill impairment charge of $1,671.0 million during the three and six months ended June 30, 2026. The charge was recorded in Other operating expense (income), net in the Condensed Consolidated Statements of Operations. The goodwill impairment charge did not result in any current cash expenditure and did not affect the Company’s cash flows from operating activities or compliance with the financial covenants under the Company’s Credit Agreement.


	June 30, 2026						December 31, 2025
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Definite-life intangibles:
Developed technology	$	572,827	$	(280,937)	$	291,890	$	574,250	$	(266,368)	$	307,882
Customer relationships	646,116		(185,307)		460,809		652,028		(176,158)		475,870
Capitalized development expenses	981,703		(597,502)		384,201		921,399		(546,111)		375,288
Other Intangible Assets	71,893		(63,986)		7,907		78,007		(68,873)		9,134
Trademarks	17,769		(740)		17,029		—		—		—
Total definite-life intangibles	2,290,308		(1,128,472)		1,161,836		2,225,684		(1,057,510)		1,168,174
Indefinite-life intangibles:
Trademarks	—		—		—		481,234		—		481,234
Total Intangible assets	$	2,290,308	$	(1,128,472)	$	1,161,836	$	2,706,918	$	(1,057,510)	$	1,649,408


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Cost of subscriptions and licenses	$	295	$	286	$	581	$	571
Amortization of intangible assets	44,570		38,284		87,563		75,637
Total amortization expense	$	44,865	$	38,570	$	88,144	$	76,208

Following the Hexagon shareholders’ approval of the Distribution on April 24, 2026, management initiated the phase out of legacy brands and transition of the Octave business to a unified Octave brand. As such, the Company performed an assessment of the useful life estimates of all trademarks which have historically been carried as indefinite-life intangible assets in the Condensed Consolidated Balance Sheets and had a carrying amount of $481.2 million as of December 31, 2025. In completing this assessment, management concluded all trademark assets should no longer be carried as indefinite-life intangible assets, but rather determined each to have a finite useful life.

As such, management performed a quantitative impairment test subsequent to such approval. The fair value of the trademarks was estimated using the relief-from-royalty method, a form of the income approach. The quantitative impairment test consisted of a comparison of the fair value of the Company’s trademarks with the carrying amount, and in all cases where the carrying amount exceeded its fair value, an impairment charge was recognized in an amount equal to the excess. For each trademark, after the impairment charge was recognized, the adjusted carrying amount of the intangible asset serves as its new accounting basis which will be amortized prospectively over its remaining useful life of two years. During the three months ended June 30, 2026, the Company recognized a non-cash impairment charge of $463.7 million. The charge was recorded in Other operating expense (income), net in the Condensed Consolidated Statements of Operations. The indefinite-life impairment charge did not result in any current cash expenditure and did not affect the Company’s cash flows from operating activities or compliance with the financial covenants under the Company’s Credit Agreement.

For the three months ended June 30, 2026 and 2025, total costs capitalized were $29.2 million and $34.0 million, respectively. For the six months ended June 30, 2026 and 2025, total costs capitalized were $60.3 million and $66.4 million, respectively. For the three months ended June 30, 2026 and 2025, the related amortization recorded within Amortization of intangible assets in the Condensed Consolidated Statements of Operations was $24.9 million and $20.0 million, respectively. For the six months ended June 30, 2026 and 2025, the related amortization recorded within Amortization of intangible assets in the Condensed Consolidated Statements of Operations was $50.2 million and $39.1 million, respectively.

The Company recorded goodwill and indefinite-life intangible asset impairment charges during the period within Other operating expense (income), net in the Condensed Consolidated Statements of Operations. A summary of components within this account are as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Goodwill impairment	$	1,671,000	$	—	$	1,671,000	$	—
Indefinite-life intangible asset impairment	463,660		—		463,660		—
Other operating expense (income)	2,326		(16,529)		6,779		(12,976)
Total Other operating expense (income), net	$	2,136,986	$	(16,529)	$	2,141,439	$	(12,976)