Company: FWDI
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001683168-25-003548
Chunk: 18

Company: Forward Industries, Inc.
Filing Date: 2025-05-14
Form: 10-Q
Item: Item 1
Chunk 18
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 2025, estimated
amortization expense for the Company’s intangible assets is as follows:

    Schedule of estimated amortization expense 

    Remainder of Fiscal 2025 
    $106,000 
  
    Fiscal 2026 
     121,000 
  
    Fiscal 2027 
     82,000 
  
    Fiscal 2028 
     78,000 
  
    Fiscal 2029 
     39,000 
  
    Fiscal 2030 
     39,000 
  
    Thereafter 
     109,000 
  
    Total 
    $574,000 

     12 

Goodwill

Goodwill
represents the future economic benefits of assets acquired in a business combination that are not individually identified or separately
recognized. The Company’s goodwill resulted from the acquisitions of Kablooe and IPS in Fiscal 2020 and Fiscal 2018, respectively.
The goodwill associated with the IPS acquisition is not deductible for tax purposes, but the goodwill associated with the Kablooe acquisition
is deductible for tax purposes.

In
December 2024, IPS was notified by its largest customer of its plan to discontinue its insulin patch pump program, on which IPS was working,
and was beginning to wind down all activities related to it. Revenue from this customer (all of which related to this program) represented
more than 30% of the Company’s consolidated net revenues in fiscal 2024. Due to the historically high concentration of revenue with
this customer, the loss of its business was considered a triggering event which prompted the Company to evaluate the goodwill of the IPS
reporting unit. Management concluded an impairment was more likely than not to have occurred and performed a quantitative goodwill impairment
test for the IPS reporting unit at December 31, 2024. Using primarily an income approach methodology, the fair value of the IPS reporting
unit was estimated using a discounted cash flow analysis incorporating variables categorized within Level 3 of the fair value hierarchy
such as projected revenues, growth rate and discount rate. The quantitative testing indicated the carrying amount of the IPS reporting
unit exceeded its fair value, resulting in a goodwill impairment charge of $225,000 in the three months ended December 31, 2024, primarily
driven by a reduction in the expected future performance of the IPS reporting unit.

In
the second quarter of fiscal 2025, the IPS reporting unit continued to experience low levels of staff utilization due in part to the loss