Goodwill and Intangible Assets

6 Months Ended

Jun. 30, 2026

Note 5. Goodwill and Intangible Assets

Goodwill

In the third quarter of fiscal 2021, we completed the AffloVest Acquisition. The purchase price of the AffloVest product line exceeded the net acquisition-date estimated fair value amounts of the identifiable assets acquired and the liabilities assumed by $31.1 million, which was assigned to goodwill. In the first quarter of fiscal 2026, we completed the acquisition of LymphaTech. The purchase price of LymphaTech exceeded the net acquisition-date estimated fair value amounts of the identifiable assets acquired and the liabilities assumed by $8.5 million, which was assigned to goodwill.

The changes in the carrying amount of goodwill were as follows:


(In thousands)
Goodwill at December 31, 2025	$	31,063
Addition for acquisition		8,491
Goodwill at June 30, 2026	$	39,554

Intangible Assets

Our patents and other intangible assets are summarized as follows:


		Weighted-	At June 30, 2026
		Average	Gross
		Amortization	Carrying		Accumulated		Net
(In thousands)		Period	Amount		Amortization		Amount
Definite-lived intangible assets:
Patents		11 years	$	1,133	$	359	$	774
Tradenames		10 years		370		14		356
Customer relationships		8 years		31,540		11,513		20,027
Developed technology		7 years		16,703		5,818		10,885
Other		3 years		3,000		—		3,000
Subtotal				52,746		17,704		35,042
Unamortized intangible assets:
Tradenames				9,500		—		9,500
Patents pending				205		—		205
Total intangible assets			$	62,451	$	17,704	$	44,747


		Weighted-	At December 31, 2025
		Average	Gross
		Amortization	Carrying		Accumulated		Net
(In thousands)		Period	Amount		Amortization		Amount
Definite-lived intangible assets:
Patents		11 years	$	1,083	$	318	$	765
Customer relationships		9 years		31,000		10,280		20,720
Developed technology		7 years		13,000		5,095		7,905
Subtotal				45,083		15,693		29,390
Unamortized intangible assets:
Tradenames				9,500		—		9,500
Patents pending				277		—		277
Total intangible assets			$	54,860	$	15,693	$	39,167

Amortization expense was $1.1 million and $0.9 million for the three months ended June 30, 2026 and 2025, respectively, and $2.0 million and $1.9 million for the six months ended June 30, 2026 and 2025, respectively, of which $0.5 million and $0.3 million for the three months ended June 30, 2026 and 2025, respectively, and $0.8 million and $0.6 million for the six months ended June 30, 2026 and 2025, respectively, was recorded in cost of sales revenue. Future amortization expenses are expected as follows:


(In thousands)
2026 (July 1 - December 31)	$	2,518
2027		5,405
2028		5,404
2029		4,536
2030		4,100
Thereafter		13,079
Total	$	35,042

In the third quarter of 2025, we performed our annual goodwill impairment test utilizing both the qualitative and quantitative approach described in FASB ASU No. 2021-03, “Intangibles—Goodwill and Other (Topic 350) – Accounting Alternative for Evaluating Triggering Events.” Based on the testing using the qualitative approach, it was determined that it was not more likely than not that the fair value of the reporting

unit was less than the carrying value. As a result, it was not deemed necessary to proceed to the quantitative test and no impairment was recognized.