Xponential Fitness, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Intangible Assets

Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Note 7 – Goodwill and Intangible Assets

Goodwill represents the excess of cost over the fair value of identifiable net assets acquired related to the original purchase of the various franchise businesses and acquisition of company-owned transition studios. Goodwill is not amortized but is tested annually for impairment or more frequently if indicators of potential impairment exist. The Company has not identified any events or circumstances at March 31, 2023 that would require an interim goodwill impairment test. The carrying value of goodwill at March 31, 2023 and December 31, 2022 totaled $165,697 net of cumulative impairment of $3,376.

Intangible assets consisted of the following:


		March 31, 2023							December 31, 2022
	Amortization period (years)	Gross amount		Accumulated amortization			Net amount		Gross amount		Accumulated amortization			Net amount
Trademarks	10	$	21,110	$	(3,134	)	$	17,976	$	21,110	$	(2,606	)	$	18,504
Franchise agreements	7.5 – 10		69,100		(27,175	)		41,925		69,100		(25,143	)		43,957
Web design and domain	3 – 10		430		(225	)		205		430		(196	)		234
Deferred video production costs	3		4,518		(2,540	)		1,978		4,046		(2,173	)		1,873
Total definite-lived intangible assets			95,158		(33,074	)		62,084		94,686		(30,118	)		64,568
Indefinite-lived intangible assets:
Trademarks	N/A		72,607		—			72,607		72,607		—			72,607
Total intangible assets		$	167,765	$	(33,074	)	$	134,691	$	167,293	$	(30,118	)	$	137,175

Amortization expense was $2,955 and $2,648, for the three months ended March 31, 2023 and 2022, respectively.

The anticipated future amortization expense of intangible assets is as follows:


Remainder of 2023	$	8,670
2024		11,038
2025		10,504
2026		7,499
2027		6,280
Thereafter		18,093
Total	$	62,084