Company: MFON
Filing Date: 2025-06-06
Form Type: 10-Q
Source: 0001641172-25-014006
Chunk: 10

Company: MOBIVITY HOLDINGS CORP.
Filing Date: 2025-06-06
Form: 10-Q
Item: Part I, Item 1
Chunk 10
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 not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does
not pass the qualitative assessment, then the reporting unit’s carrying value is compared to its fair value. The fair values of
the reporting units are estimated using market and discounted cash flow approaches. Goodwill is considered impaired if the carrying value
of the reporting unit exceeds its fair value. The discounted cash flow approach uses expected future operating results. Failure to achieve
these expected results may cause a future impairment of goodwill at the reporting unit.

    6

We conducted our annual impairment tests of goodwill
as of December 31, 2024. As a result of these tests, we had a total impairment charge of $0.

Intangible assets consist of patents and trademarks,
purchased customer contracts, purchased customer and merchant relationships, purchased trade names, purchased technology, non-compete
agreements, and software development costs. Intangible assets are amortized over the period of estimated benefit using the straight-line
method and estimated useful lives ranging from one year to twenty years. No significant residual value is estimated for intangible assets.

The Company’s evaluation of its goodwill and
intangible assets resulted in no impairment charges for the three months ended March 31, 2025 and 2024, respectively.

Software Development Costs

Software development costs include direct costs incurred
for internally developed products and payments made to independent software developers and/or contract engineers. The Company accounts
for software development costs in accordance with the Financial Accounting Standards Board (“FASB”) guidance for the costs
of computer software to be sold, leased, or otherwise marketed (Accounting Standards Codification subtopic 985-20, Costs of Software to
Be Sold, Leased, or Marketed, or “ASC Subtopic 985-20”). Software development costs are capitalized once the technological
feasibility of a product is established, and such costs are determined to be recoverable. The technological feasibility of a product encompasses
technical design documentation and integration documentation, or the completed and tested product design and working model. Software development
costs are capitalized once the technological feasibility of a product is established and such costs are determined to be recoverable against
future revenues. Technological feasibility is evaluated on a project-by-project basis. Amounts related to software development that are
not capitalized are charged immediately to the appropriate expense account. Amounts that are considered “research and development”
that are not capitalized are immediately charged to engineering, research, and development expense.

Capitalized