3. IMPAIRMENT OF GOODWILL

During the three months ended September 30, 2024, the Company considered the decline in its stock price to be an indicator of impairment and, accordingly, performed a quantitative impairment assessment of its goodwill. This assessment involved comparing the estimated fair value of each of its reporting units to the reporting unit’s carrying value, inclusive of the goodwill balance allocated to the reporting unit.

Estimation of the fair value of each reporting unit involved the projection of discounted future cash flows using certain assumptions that are subjective in nature, including assumptions related to historical and market growth rates and gross margin improvements, as well as future operating expense synergies and optimization, among other factors. Based on its analysis, the Company determined that the carrying value exceeded the estimated fair value as of September 30, 2024 in certain reporting units. Consequently, the Company recognized a goodwill impairment charge of $69,111 during the three and nine months ended September 30, 2024 in the condensed consolidated statements of operations. The Company recognized a goodwill impairment charge of $89,087 during the three and nine months ended September 30, 2023 in the condensed consolidated statements of operations.

The fair value measurements used in the evaluation described above are considered to be Level 3 valuations within the fair value hierarchy, as the measurements involve projections of discounted future cash flows, which are derived from unobservable assumptions, the most subjective of which are the discount rates for each respective reporting unit. The discount rate used in for all reporting units ranged from 19.50% to 23.50% during the three and nine months ended September 30, 2024. The discount rate used for all reporting units ranged from 20% to 22.5% during the three and nine months ended September 30, 2023.

Based on its analysis, the Company determined that the Legacy Blink reporting unit’s carrying value exceeded the estimated fair value as of September 30, 2024. Consequently, the Company recognized a goodwill impairment charge of $69,111 during the three and nine months ended September 30, 2024 in the condensed consolidated statements of operations.

As a result of the impairment analysis it was determined that the Mobility reporting unit qualifies as “at risk” for impairment. The Company quantitatively defines “at risk” as a percentage of the excess of the reporting unit’s fair value over its carrying amount that is less than 10%. An “at risk” reporting unit qualitatively represents a reporting unit with a higher degree of uncertainty of the reporting unit’s ability to meet its forecasted cash flows based upon revenue growth rate and operating margin assumptions relied upon in the estimation of its fair value. As of September 2024, the Mobility reporting unit’s carrying value exceeded its fair value by approximately 4%. The goodwill attributable to the Mobility reporting unit as of September 30, 2024 was $27,536.

Changes in goodwill during the nine months ended September 30, 2024 were as follows:

 SCHEDULE OF GOODWILL