Company: UONE
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001041657-25-000013
Chunk: 102

Company: URBAN ONE, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 7
Chunk 102
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 various reporting units, Radio Broadcasting Licenses and TV One Trade Name

Goodwill exists whenever the purchase price exceeds the fair value of tangible and identifiable intangible net assets acquired in business combinations. 

We account for goodwill and broadcasting licenses under Accounting Standards Codification (“ASC”) 350, “Intangibles – Goodwill and Other”, (“ASC 350”) which requires the Company to test goodwill at the reporting unit level and radio broadcasting licenses and TV One Trade Name at the accounting unit level for impairment annually or whenever events or circumstances indicate that impairment may exist. 

Our annual impairment assessment is performed as of October 1 of each year using an income approach. We test the reasonableness of the inputs and outcomes of our discounted cash flow models against available market data by comparing our overall average implied multiple based on our cash flow projections and by comparing the aggregate of our estimated reporting unit fair values to the market capitalization of the Company. Impairment exists when the carrying value of these assets exceeds its respective fair value. When the carrying value exceeds fair value, an impairment amount is charged to operations for the excess.

As of December 31, 2024, we had approximately $257.8 million in broadcasting licenses and $30.0 million across seven of our 13 radio market reporting units in goodwill within the Radio Market reporting unit, which totaled $287.8 million and represented approximately 29.8% of our total assets.

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We believe our estimate of the fair value of our reporting units, radio broadcasting licenses and TV One Trade Name are critical accounting estimates as the value is significant in relation to our total assets, and our estimate of the value uses judgmental assumptions that incorporate variables based on past experiences and expectations about future operating performance. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and estimates and market factors. While we believe we have made reasonable estimates and assumptions to calculate the fair values, changes in any one estimate, assumption or a combination of estimates and assumptions, or changes in certain events or circumstances (including uncontrollable events and circumstances resulting from continued deterioration in the economy or credit markets) could require us to assess recoverability of our trade name, radio broadcasting licenses, and goodwill at times other than our annual October 1 assessments, and could result in changes to our estimated fair values and further write-downs to the carrying values of these assets. Impairment charges are non-cash in nature, and as with current and past impairment charges, any future impairment charges will not impact our