LOGM 2017 Annual Report

Intangible assets consist of the following (in thousands): December 31, 2016 December 31, 2017 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Life Remaining (in years) Identifiable intangible assets: Trade names and trademarks . . . $ 3,806 $ 955 $ 2,851 $ 70,630 $ 10,073 $ 60,557 8.1 Customer relationships . . . . . . . . 29,249 9,315 19,934 810,779 135,715 675,064 7.1 Domain names . . . . . . . . . . . . . . 913 796 117 918 894 24 1.0 Technology . . . . . . . . . . . . . . . . . 51,179 14,942 36,237 453,372 64,021 389,351 7.9 Other . . . . . . . . . . . . . . . . . . . . . . 442 359 83 442 429 13 0.3 Internally developed software . . . 8,313 5,025 3,288 38,153 13,565 24,588 1.6 $93,902 $31,392 $62,510 $1,374,294 $224,697 $1,149,597 On January 31, 2017, the Company capitalized $65.1 million for trade names and trademarks, $756.7 million for customer relationships and $385.6 million for technology as intangible assets in connection with the Merger. On July 31, 2017, the Company capitalized $0.5 million for a trade name, $10.5 million for customer relationships, and $9.2 million for technology as intangible assets in connection with the acquisition of Nanorep. The carrying amount of intangible assets also changed due to foreign currency translation adjustments, as applicable. The Company also capitalized $1.6 million and $29.8 million during the years ended December 31, 2016 and 2017, respectively, of costs related to internally developed software to be sold as a service incurred during the applica- tion development stage and is amortizing these costs over the expected lives of the related services. The Company is amortizing its intangible assets based upon the pattern in which their economic benefit will be realized, or if this pattern cannot be reliably determined, using the straight-line method over their estimated use- ful lives. Amortization relating to technology, documented know-how (other) and internally developed software is recorded within cost of revenues and the amortization of trade name and trademark, customer relationships, domain names and non-compete agreements (other) is recorded within operating expenses. Amortization expense for intangible assets consisted of the following (in thousands): Years Ended December 31, 2015 2016 2017 Cost of revenue: Amortization of internally developed software . . . . . . . . . . . . . . . . . . . . . . . . . . $1,196 $ 1,778 $ 8,540 Amortization of acquired intangibles (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,955 4,604 48,676 Sub-Total amortization of intangibles in cost of revenue . . . . . . . . . . . . . . . . 4,151 6,382 57,216 Amortization of acquired intangibles (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,916 5,457 134,342 Total amortization of intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,067 $11,839 $191,558 (1) Total amortization of acquired intangibles was $4.9 million, $10.1 million and $183.0 million for the years ended December 31, 2015, 2016, and 2017, respectively. 73