Annual report pursuant to Section 13 and 15(d)

Note 4 - Intangible and Other Assets

v3.23.1
Note 4 - Intangible and Other Assets
12 Months Ended
Dec. 31, 2022
Notes to Financial Statements  
Intangible Assets Disclosure [Text Block]
4.

INTANGIBLE AND OTHER ASSETS

 

Intangible and other assets consisted of the following for the periods presented:

 

   

December 31,

   

December 31,

   

Useful

 
   

2022

   

2021

   

Life (Years)

 
                           

Partner and customer relationships

  $ 13,376,000     $ 13,376,000     3 - 7  

Capitalized software development costs

    5,262,000       4,339,000       3    

Capitalized third-party game property costs

    500,000       -       5    

Developed technology

    7,880,000       7,880,000     5 - 7  

Influencers/content creators

    2,559,000       2,559,000     3 - 5  

Trade name

    189,000       189,000       7    

Domain

    68,000       68,000     5 - 10  

Copyrights and other

    760,000       1,141,000     5 - 10  
      30,594,000       29,552,000            

Less: accumulated amortization

    (10,528,000

)

    (5,309,000

)

         

Intangible and other assets, net

  $ 20,066,000     $ 24,243,000            

 

Total amortization expense for the fiscal years ended December 31, 2022 and 2021 totaled $5,629,000 and $3,187,000, respectively. Amortization expense included in cost of revenues for the fiscal years ended December 31, 2022 and 2021 totaled $90,000 and $63,000, respectively.

 

In June 2022, we purchased “Anime Battlegrounds X”, a highly rated game on Roblox, from a third-party game developer. The total purchase price of $500,000 was capitalized and is being amortized to cost of revenue over the estimated useful life of 5 years.

 

During the third quarter of 2022, the Company rebranded certain products acquired in connection with the acquisition of Mobcrush. As a result, the Company recorded a write down of trademark related intangible assets acquired in connection with the acquisition of Mobcrush totaling $423,000, which is included as a component of amortization expense in general and administrative expense in the accompanying consolidated statement of operations for the year ended December 31, 2022.

 

The Company expects to record aggregate amortization expense for each of the five succeeding fiscal years as follows:

 

For the years ending December 31,

       

2023

  $ 5,108,000  

2024

    4,706,000  

2025

    4,100,000  

2026

    2,951,000  

2027

    2,161,000  

Thereafter

    1,040,000  
    $ 20,066,000