NEW YORK TIMES CO

4. Marketable Securities

The Company accounts for its marketable securities as AFS. The Company recorded $0.7 million and $11.4 million of net unrealized losses, respectively, in Accumulated Other Comprehensive Income (“AOCI”) as of December 31, 2023, and December 31, 2022, respectively.

The following tables present the amortized cost, gross unrealized gains and losses, and fair market value of our AFS securities as of December 31, 2023, and December 31, 2022:

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The following tables present the AFS securities as of December 31, 2023, and December 31, 2022, that were in an unrealized loss position for which an allowance for credit losses has not been recorded, aggregated by investment category and the length of time that individual securities have been in a continuous loss position:

We assess AFS securities on a quarterly basis or more often if a potential loss-triggering event occurs. See Note 2 for factors we consider when assessing AFS securities for recognition of losses or allowance for credit losses.

As of December 31, 2023, and December 31, 2022, we did not intend to sell and it was not likely that we would be required to sell these investments before recovery of their amortized cost basis, which may be at maturity. Unrealized losses related to these investments are primarily due to interest rate fluctuations as opposed to changes in credit quality. Therefore, as of December 31, 2023, and December 31, 2022, we haveno realized losses or allowance for credit losses related to AFS securities.

As of December 31, 2023, our short-term and long-term marketable securities had remaining maturities of less thanone month to 12 months, and 13 months to 26 months, respectively. See Note 8 for additional information regarding the fair value hierarchy of our marketable securities.

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5. Business Combination

The Athletic Acquisition

The Company accounts for business combinations using the acquisition method of accounting. The purchase price is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. The excess of the purchase price over the estimated fair value of the net assets acquired is recorded as goodwill. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition.

On February 1, 2022, the Company acquired The Athletic in an all-cash transaction. The consideration paid of approximately $550.0 million was funded from cash on hand and included $523.5 million, which we determined to be the purchase price for assets acquired and liabilities assumed, and $26.7 million paid in connection with the acceleration of The Athletic stock options. The stock options acceleration is included in Acquisition-related costs in our Consolidated Statements of Operations for the year ended December 31, 2022. The Company finalized the valuation of assets acquired and liabilities assumed for the acquisition of The Athletic within the required measurement period of one year.

The following table summarizes the allocation of the purchase price (at fair value) to the assets acquired and liabilities assumed of The Athletic as of February 1, 2022 (the date of acquisition):

(1) Included in Miscellaneous assets in our Consolidated Balance Sheets.

(2) Included in Intangible assets, netin our Consolidated Balance Sheets.

(3) Includes Unexpired subscriptions revenue of $28.1 million.

(4) Included in Deferred income taxes in our Consolidated Balance Sheets.

(5) Includes measurement period adjustment related to deferred tax asset and working capital adjustments.

Goodwill is primarily attributable to future subscribers expected to be acquired both organically and through synergies from adding The Athletic to the Company’s products as well as the acquired assembled workforce. Goodwill is not expected to be deductible for tax purposes. The fair value of trademarks is estimated using a relief from royalty valuation method, the fair value of subscriber relationships is estimated using a multi-period excess earnings valuation method, and the fair value of developed technology and content archive is estimated using a replacement cost method.

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The following unaudited pro forma summary presents consolidated information of the Company, including The Athletic, as if the business combination had occurred on December 28, 2020, the first day of fiscal year ended December 26, 2021, which is the earliest period presented herein:

Adjustments made to the pro forma summary include (1) transaction costs and other one-time non-recurring costs that reduced expenses by $47.8 million for the year ended December 31, 2022, and increased expenses by $47.8 million for the year ended December 26, 2021; (2) recognition of additional amortization related to the intangible assets acquired; (3) alignment of accounting policies; and (4) recognition of the estimated income tax impact of the pro forma adjustments. The pro forma summary does not reflect cost savings or operating synergies expected to result from the acquisition. These pro forma results are illustrative only and not indicative of the actual results of operations that would have been achieved nor are they indicative of future results of operations.

The changes in the carrying amount of goodwill as of December 31, 2023, and since December 26, 2021, were as follows:

(1) Includes measurement period adjustment related to deferred tax asset and working capital adjustments in connection with The Athletic Media Company acquisition.

The foreign currency translation line item in AOCI reflects changes in goodwill resulting from fluctuating exchange rates related to the consolidation of certain international subsidiaries.

For the 2023 annual impairment testing, based on our qualitative assessment, we concluded that goodwill is not impaired. For the 2022 annual impairment testing, based on our qualitative assessment, we concluded that goodwill is not impaired.

During the quarter ended September 30, 2023, we reduced our long-term advertising and subscription revenue expectations for our Serial podcasts. As a result, we performed an interim quantitative impairment test for the Serial indefinite-lived intangible asset. We compared the fair value of the Serial trademark, calculated using a discounted cash flow analysis, to its carrying value and recorded an impairment charge of approximately $2.5 million. This charge is included in Impairment charges in our Consolidated Statement of Operations within the New York Times Group operating segment. As of December 31, 2023, and December 31, 2022, the carrying value of the indefinite-lived intangible asset included in Intangible assets, net in our Consolidated Balance Sheets was $2.5 million and $5.0 million, respectively. See Note 2 for factors the Company considers when assessing indefinite-lived intangible assets for impairment. The 2023 annual impairment test did not identify any further impairments.

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In our 2022 annual impairment testing, we performed a quantitative assessment of our indefinite-lived intangible asset relating to our Serial podcast. We reassessed the fair value of the asset and, due to a decrease in advertiser demand, slower production of shows for our Serial podcast as well as the macroeconomic environment, recorded an impairment charge of $4.1 million during the year ended December 31, 2022. This charge is included in Impairment charges in our Consolidated Statements of Operations within the New York Times Group operating segment.

As of December 31, 2023, and December 31, 2022, the gross book value and accumulated amortization of the intangible assets with definite lives were as follows:

Amortization expense for intangible assets included in Depreciation and amortization in our Consolidated Statements of Operations for the years ended December 31, 2023, and December 31, 2022, were $29.3 million and $27.1 million, respectively.

In 2023 and 2022, we didnot identify any impairments related to intangible assets with definite lives.

The estimated aggregate amortization expense for each of the following fiscal years ending December 31 is presented below:

As of December 31, 2023, the aggregate carrying amount of intangible assets of $285.5 million, which includes an indefinite-lived intangible of $2.5 million, is recorded in Intangible Assets, netin our Consolidated Balance Sheets.

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