Cisco Systems (NASDAQ: CSCO) offered to acquire Splunk (NASDAQ: SPLK) for more than $20 billion, the Wall Street Journal reported citing people familiar with the matter. Splunk's acquisition of TruSTAR extends its leadership in security analytics through cloud-native threat intelligence integration and automation. Making the world smarter, happier, and richer. Doug Merritt, Splunk's CEO for the past six years, stepped down in November. Listen to article. That's a change from its traditional business model of selling perpetual software licenses, deployed in customers' data centers. The positive reaction from investors has some logic to it. Cisco Systems' rumored acquisition offer for Splunk would create one of the largest cybersecurity vendors in the world.. eric kocher generation kill; blue shield of northeastern ny claims address; alycia debnam carey siblings; cauliflower jalapeno nobu; SEPTEMBER 2013. In November last year, San Francisco-based Splunk announced Doug Merritt has stepped down as its chief executive officer (CEO) and that the company's chair, Graham Smith, would be the interim CEO. It's pretty likely Silver Lake didn't invest in Splunk to make 0.75%, but rather to make big money on the conversion. Here are 12 other startups analysts say it could buy to fend off competitors. So what should new GCP leader Thomas Kurian do? Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. In June, the private-equity firm Silver Lake invested $1 billion in Splunk to help with that transition. Mobile World Congress (MWC) is back in a big way and delivered the 5Goods (my clever play on words) on many . You may cancel your subscription at anytime by calling Th ecompany serves four primary markets: wired infrastructure, wireless communications, enterprise storage, and industrial & others. Cisco Systems made a takeover offer worth more than US$20 billion (A$28 billion) for software maker Splunk, the Wall Street Journal reported, citing people familiar with the matter. You will be charged For many organizations, 2020 has been a year of cutting costs and staying afloat amid a turbulent market. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. From 2008 to 2010, Mitra . Splunk jumped up 16 percent post-market on reports of the takeover bid. Splunk . Splunks acquisition of Rigor adds a unique Digital Experience Management (DEM) platform that combines the power of synthetic monitoring with intelligent optimization engine capabilities to enhance Splunk's Observability solutions. However, Splunks investors reacted positively to the news, with the companys stock price jumping 9% on the morning of February 14. Cisco and Splunk have been in the news since last week when The Wall . Cloudmeter. Build, own, manage and support B2B and B2C web and mobile properties. The announcement marks a return to M&A activity for Splunk and the massive $1.05 billion deal for SignalFX in 2019. Ciscos planned acquisition of Splunk has received favorable reactions from industry analysts. Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks. Aruba, a Hewlett Packard Enterprise Company, AMD & Supermicro Performance Intensive Computing, Cisco Powers Hybrid Work With Private 5G, New Wi-Fi 6E And Catalyst Series. According to Futurum Research, the deal would be a good fitOpens a new window for both companies. View our Privacy Policy for more information. The reported deal would be the largest price tag for Cisco, which is no stranger to technology acquisitions. Splunk shares rose as much as 14% in extended trading after a report about an acquisition offer from Cisco. The company has been pivoting to a recurring revenue model by shifting from traditional software licenses to cloud-based subscriptions while also steadily growing the customer base. The Motley Fool has a disclosure policy. He is best known in the industry for his stint as the chief financial officer and later executive vice president at Salesforce. The analyst believes Cloudera shareholders are getting a good deal with the private equity buyout."We note CLDR has been the target of acquisition rumors since mid-2020, and thus we view the . It's obviously a nice thing when someone is interested in your stock, but as a recent Splunk shareholder, I'm hoping the company doesn't sell, if the offer is in fact close to $20 billion. We continue to see incredibly strong demand across our portfolio, emphasizing the criticality and relevance of Ciscos innovation. As a shareholder, I'm certainly hoping Splunk holds out for a higher price. Rigor's monitoring and optimization solutions complement the other Splunk offerings. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. Read focused primers on disruptive technology topics. The company also made four cloud-related acquisitions in 2020. You can see Splunk's revenue took a dip in 2020 as it went through the trough of this transition. Access timely security research and guidance. Splunks acquisition of Omnition adds distributed tracing analytics for next generation application monitoring, expanding Splunks observability capabilities. As I see it, Splunks presence in the security and observability space would be an incredibly attractive addition to Ciscos existing solutions, while adding a substantial cloud and recurring revenue-based business to the companys top line, said Daniel Newman, Futurums principal analyst. Statement of changes in beneficial ownership of securities. Customer success starts with data success. A 24/7 Wall St. analysis reveals that the largest merger deal of the past two decades was worth more than $128 billion. mutant fly stardew valley; nba waterboy salary per hour near new jersey; wimbledon draw 2022 wiki; london classical concerts 2022; beadnell camping pods The report about said discussions comes not long after Microsoft's mammoth $70 . Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. The acquisition complements Cisco's strategy of developing networking solutions that integrate voice, data and video traffic. Even though its cloud revenues zoomed 77% in the year, its overall revenue was down 5% year-over-year, and its operating cash flow was negative $191 million with free cash flow of negative $228 million. The acquisition by Cisco could provide much-needed breathing space for the company to invest heavily in cloud, IT security, and data observability platforms and digital transformation initiatives in the year ahead. The final billion-dollar deal (until we hear about Slack perhaps) is the $1.33 billion Vlocity acquisition earlier this year. At the time of the announced deal, that was some 30% above where Splunk stock was trading, although shares jumped nearly 10% higher on the news. Cost basis and return based on previous market day close. Splunk shares rose as much as 14% in extended trading on Friday after the Wall Street Journal reported that Cisco made an offer to buy the data analytics software company for over $20 billion. The offer exceeds Splunks current market capitalization by $2 billion, but reports indicate the two companies havent discussed it yet. Total revenue at Splunk grew 19% from a year earlier, while Cisco's overall revenue in the most recent quarter increased 8%. a GAAP operating loss of $780 million in 2021. Splunk has acquired in 4 different US states, and 3 countries. My core competency is finding out people's issues in business. Splunk vs Uber I got the final offer from Splunk (P4: 230k, 15%, 440k/3yrs, TC=411k), probably the highest offer for P4. According to The Wall Street Journal, which broke the news on February 11, the two companies havent gotten around to discussing the acquisition yet. Splunk's acquisition of TwinWave extends our security leadership and adds capabilities to empower the security analyst with cloud-native, automated threat analysis for phishing and malware. At just under 10 times trailing-12-month sales, this cloud stock trades for a discount to its higher growth peers like Dynatrace and Datadog. The top source for up-to-the-minute company Merger News. Company Location: Mount Laurel, NJ. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. However, now it's coming through the other end of it: Even though Splunk is now past the bottom of the transition, revenue growth according to generally accepted accounting principles (GAAP) is still lagging behind the real recurring top line the company is taking in. Splunk (SPLK) Q4 2023 Earnings Call Transcript, The Nasdaq Could Soar in 2023 -- 5 Stocks Down 57% to 91% to Buy Before It Does, Why Splunk Shares Gained 10.8% Last Month, 1 Monster Growth Stock to Buy Hand Over Fist, According to Wall Street, 2 Reasons to Avoid a Roth 401(k) for Your Retirement Savings, Want $1 Million in Retirement? Cisco Systems has put down a takeover offer for Splunk worth more than $20 billion, according to a Friday evening report published by The Wall Street Journal. See here for a complete list of exchanges and delays. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Ciscos acquisition offer shows us that cybersecurity will continue to be a key driver of mergers and acquisitions (M&A) in 2022. Plan your migration with helpful Splunk resources. How far over that figure will determine whether the acquisition goes through or not. Ciscos growth is bogged down by a lack of foothold in the cloud-based subscription space which offers great promise for the future. Cisco Systems has held acquisition talks with Splunk, whose software mines data for insights, including security threats. The Leading Resource on Next-Generation IT Infrastructure. San Jose, Calif.-based Cisco did not respond to CRNs request for comment on the alleged deal by publication time. You can manage your preferences at any time. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. Dropbox is a 9.3 billion market cap company. See here for a complete list of exchanges and delays. Splunk has acquired 14 companies, including 8 in the last 5 years.. Splunk's largest acquisition to date was in 2019, when it acquired SignalFx for $1.1B. Build resilience to meet todays unpredictable business challenges. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Microsoft's acquisition of B's parent company for $7.5 billion in March of this year shocked the gaming industry and raised the level of XBOX's camp. Splunk . Never Miss a Revenue Moment With Intent and Pre-Intent Data, 10 Actionable Data Trends in 2023 To Nail Your Analytics, How Technology Is Digitally Transforming Ad Operations, Three Ways Enterprise Architecture is Driving Digital Transformation, Seed-stage Companies Can Create FOMO to Gain an Edge in Fundraising, Correcting the Course of Failed Climate-conscious Planning with AI, Cloud Cost Optimization as a Lever Against Inflationary Pressure, How Simulations Can Help Us Solve the Climate Crisis in a Way That Benefits Everyone. Splunk's software collects, analyzes and visualizes real-time and historical machine data from any source. Splunk The $19.67 billion data-analytics company Splunk has had its ups and downs. [Related: Cisco Powers Hybrid Work With Private 5G, New Wi-Fi 6E And Catalyst Series]. Splunks acquisition of Phantom Cyber adds security orchestration, automation and response to Splunks portfolio and extends automation capabilities to Splunk's customers in security and IT. Splunk CEO on the data firm's new initiative focused on government cybersecurity, Jim Cramer's Investing Club meeting Friday: Costco, Eli Lilly, Apple, Goldman Sachs upgrades this internet of things stock which it sees surging 60%, Top 10 things the Club is watching in the stock market Friday. This one was a gift for the core CRM product. Pundits speculate that Google parent Alphabet could acquire ServiceNow, Atlassian, Splunk or perhaps Zayo.. for both companies. (if applicable) for The Wall Street Journal. Several years ago, Splunk began to deploy its offering via the cloud on a subscription basis. According to Newman, Splunk underwent a rough phase in 2021, losing its CEO and witnessing its stock price taking a tumble, but the company still packs a punch and offers a lot of value to potential buyers. Though the two companies didnt react to the rumors for a few days after they surfaced, Chuck Robbins, Ciscos chairman and CEO, confirmed the developments during its Q2 earnings call. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. Graham V. Smith, the chairman of Splunks board, is currently serving as interim CEO to fill the leadership void. The site owner may have set restrictions that prevent you from accessing the site. Plan your migration with helpful Splunk resources. Deeply embedded in the largest companies and their technology systems, it would be a big undertaking to replace Splunk with a competitor. We've been tracking company news on mergers and acquisitions since 1999. Splunks acquisition of SignalFx adds real-time monitoring and metrics for cloud infrastructure, microservices and applications, enhancing Splunks position as a leader in observability and APM. The positive reaction from investors has some logic to it. See why organizations trust Splunk to help keep their digital systems secure and reliable. Cisco is reportedly eyeing a Splunk acquisition. Transform your business in the cloud with Splunk. SDxCentral employs cookies to improve your experience on our site, to analyze traffic and performance, and to serve personalized content and advertising relevant to your professional interests. Deliver the innovative and seamless experiences your customers expect. Ciscos offer comes when Splunk is actively hunting for a new CEO following former president and CEO Doug Merritts departure in November 2021. All Rights Reserved. According to a report by GlobalData, 24,689 deals were announced worldwide in H1 of 2020, which marks a 15% decline YoY. Feb 11 (Reuters) - Network gear maker Cisco Systems Inc (CSCO.O) has made a takeover offer worth more than $20 billion for software maker Splunk Inc (SPLK.O), the Wall Street Journal reported on Friday, citing people familiar with the matter. However, an ability to package Splunks leading Security analytics and ITOM solutions with other security offerings, further optimize distribution and pricing, could present very interesting potential M&A synergies for Cisco, Marshall added. Apr 16, 2021 1:02 PM EDT. Press Release: 6/6/2019 Xerox Acquires Two New Dealers to Expand Presence in the Small-To-Medium Sized Business Market. Last week, Rigor's acquisition by Splunk was announced and it's a testament to Craig and his team for building an . Splunks acquisition of Metafor expands our capabilities in IT operations and security incident and event management (SIEM) by adding machine learning and anomaly detection to our solutions, which helps customers detect unknown and malicious threats. Cisco, a leader in unified access security and multifactor authentication thanks to its 2018 $2.35 billion Duo Security buy, could be complimented by Splunks strength around security operations, which the company came by from its own 2018 acquisition of Phantom Cyber, a company specializing in security orchestration, automation and response capabilities. These are used to let you login and to and ensure site security. Cisco's offer comes when Splunk is actively hunting for a new CEO following . Cisco did not immediately respond to a request for comment, while a spokesperson for Splunk said the company did not comment on rumors or speculation. Opting out of these cookies may impact some minor site functions. Accelerate value with our powerful partner ecosystem. It's had to adapt its suite of services and the way it bills customers for this new cloud era. Jun 11, 2018 . This cloud transformation also caused Splunk to dip into negative free cash flow territory, and it only just returned to positive free cash flow in Q1 2022 (to $66.7 million). Cisco has sought to expand its security business while also selling data center networking equipment and Webex collaboration software. If you feel that youve landed on this page in error, please contact SDxCentral Support. The Google parent had more than $100 billion in cash on hand and short-term investments as of September 2018, according to YCharts. Splunk (SPLK -1.40%) has been a severe underperformer in the last year. Already a member? It has remained stable since at around $122 per share. Still, it does not have currently have a . This is because of several transitions the company is undertaking at once. That would equate to a market cap of just over $25 billion. Opinion: Yes, Theres a Housing Crisis. Splunks acquisition of Plumbr enhances the auto-instrumentation, real user monitoring and deep application performance monitoring capabilities of Splunks Observability solutions. But there's still lots of work to be done on the cloud business. This page tracks and reports on important merger news in real-time . Reuters provides business, financial, national and international news to professionals via desktop terminals, the world's media organizations, industry events and directly to consumers. Save Search . The initial conversion price is $160 per share. Silver Lake Chairman and Managing Partner Kenneth Hao will also join Splunk's board of directors to help guide the company's journey. Discover what Splunk is doing to bridge the data divide. However, a handful of major players, particularly in tech, have continued to expand through mergers and acquisitions. The reported deal would be the . Every sell-side analyst on Wall Street has a higher price target than . Companies Contacts Investors Funding Rounds Acquisitions People Events Schools Hubs Saved . Performance & Tracking Cookies - We use our own and 3rd party analytics and targeting cookies to collect and process certain analytics data, including to compile statistics and analytics about your use of and interaction with the Site along with other Site traffic, usage, and trend data which is then used to target relevant content and ads on the Site. Invest better with The Motley Fool. People close to the company said the talks occurred recently, according to the Journal. While the revenue has been growing consistently, it has not grown at especially remarkable rates. This allows me to propose solutions that help my clients. The potential deal could position Cisco to compete with security leader Palo Alto Networks in the security operations space. In spite of these strong qualities, Splunk traded at just 7.5 times trailing sales at the end of trading Friday -- a relative bargain in the high-growth software sector. Its software helps capture, index and correlate real-time data in a searchable repository, from which it can generate graphs, reports, alerts, dashboards and visualizations. 2020 - 20211 year. *Average returns of all recommendations since inception. You will be notified in advance of any changes in rate or terms. Statement of changes in beneficial ownership of securities. Reporting by Jahnavi Nidumolu and Juby Babu in Bengaluru; Editing by Leslie Adler, Richard Chang and Sandra Maler, Exclusive: Nvidia's plans for sales to Huawei imperiled if U.S. tightens Huawei curbs-draft, Mexico can't match U.S. incentives for proposed Tesla battery plant, minister says, Taiwan's TSMC to recruit 6,000 engineers in 2023, US prepares new rules on investment in technology abroad- WSJ, Exclusive news, data and analytics for financial market professionals. The Motley Fool owns shares of and recommends Datadog and Splunk. Cisco recently made an offer for IT management and data analytics company Splunk. Cisco is known as a serial acquirer, effectively using acquisitions as a complement to research and development. Silver Lake thus isn't the only investor in line to convert debt into new stock, and this isn't the cleanest balance sheet in the software industry at the moment. acquisition-related adjustments, amortization of intangible assets and . Invest better with The Motley Fool. However, as Splunk gets further through the transition, revenue growth will gradually track closer to annualized recurring revenue (ARR), which includes the annualized value of all cloud, on-premise, and maintenance service contracts. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Splunk shares rose as much as 14% in extended trading after a report about an acquisition offer from Cisco. Visit ESPN to view the Cincinnati Reds team transactions for the current and previous seasons Splunks stock price fell 20% over a six-month period, and the company. The report cited people familiar with the matter and did not say where the potential deal stands. No deal is currently on the table, according to two people familiar with the talks, but Cisco could pay more than $20 billion, one said. She, however, added a word of caution. splunk acquisition rumors 2020; joaquin niemann sponsors. Precept is a leading multimedia networking software company. Its chief executive, Chuck Robbins, told analysts in December that Cisco would continue to look for acquisitions in security. The offer was made recently and the companies are not in active talks, the newspaper said, citing some of the sources. Cisco Systems Inc. has made a takeover offer worth more than $20 billion for software maker Splunk Inc., according to people familiar with the matter, in what would be the networking giants biggest acquisition ever. I think Splunk could be cheap right now after its underwhelming performance in the last year, though, and private equity firm Silver Lake seems to think so too. But the advent of the cloud has shifted these needs away from legacy IT systems, and Splunk wasn't exactly ready for the change. A challenge for Cisco in its transformation is the heft of the current $50 billion revenue base focused primarily on networking equipment, making it mathematically difficult to find the subscription revenues to transform the business, she said. Learn how we support change for customers and communities. Additionally, cloud revenue has a lower gross margin than term software licenses, but that's generally made up for in higher growth. Splunk said it does not comment on rumors or speculation. Over half of Rigor's customers are already Splunk customers, so when they came calling as a potential acquirer, it was a perfect fit. Necessary and Functional Cookies - These cookies are necessary for the Site to function and cannot be switched off in our systems. News Corp is a global, diversified media and information services company focused on creating and distributing authoritative and engaging content and other products and services. So, headline revenue numbers may be misleading, giving the impression Splunk is lagging behind cloud-native upstarts such as Dynatraceand Datadog. Read the Wall Street Journal report here. The deal, she said, will further strengthen Ciscos foothold in the security and analytics space, especially in Extended Detection and Response (XDR). Investment advisory firm The Motley Fool said the acquisition would make a lot of strategic sense for Cisco, which has aimed to move beyond its historical emphasis on hardware to incorporate more software and services offerings.. The two companies have an existing partnership in which Cisco uses Splunks analytics surface insights and inject more automation across its security, networking, wireless, data center and collaboration portfolios. Just to provide a sense of the activity, Cisco conducted nine acquisitions in 2020, six in 2021, and has conducted one YTD in 2022. The offer was made recently and the companies arent currently in active talks, some of the people said. They said I didn't meet their bar for principal but P4-high. Adding to the complication is that Doug Merritt, Splunk's CEO over the past six years, resigned back in November, which sent the stock another leg down. Splunk makes acquisitions that are aligned with our business strategy and enable us to expand our product portfolio, address a broader set of customer challenges, and enhance our market leadership position as the platform for turning data into action.