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. 10 . Silver Lake obviously sees upside for Splunk stock and will collect a meager amount of interest along the way for its convertible debt stake in the company. TechCrunch. Shares of Splunk ( SPLK) - Get Free Report dropped Friday after the software developer disclosed that its chief technology officer, Tim Tully, would leave next month. Deliver the innovative and seamless experiences your customers expect. Not surprisingly, when asked about the rumored acquisition during the earnings call, Robbins was coy, refusing to comment on the rumors and providing no hints in either his comments or . Total revenue at Splunk grew 19% from a year earlier, while Cisco's overall revenue in the most recent quarter increased 8%. However, Splunks investors reacted positively to the news, with the companys stock price jumping 9% on the morning of February 14. These two acquisitions formed the basis . That would equate to a market cap of just over $25 billion. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Necessary and Functional Cookies - These cookies are necessary for the Site to function and cannot be switched off in our systems. 3rd Party Cookie de-Personalization - We configure 3rd party analytics cookies to anonymize IP address and 3rd party targeting cookies to only set non-personalized information in these cookies to respect your privacy. Accelerate value with our powerful partner ecosystem. The companys software can be used for managing IT systems, DevOps and security. 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. Splunks stock was up 10.47 percent to $126.50 in after-hours trading Friday after the news was published. We base our decisions on strategic fit, cultural fit, and equally as important, the financial and evaluation fit, he said when questioned about the potential acquisition. Already a member? 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 ongoing business model transition and growing competition at Splunk could present additional challenges for Cisco if they pursued this acquisition. Read the Wall Street Journal report here. You do not have access to www.sdxcentral.com. Build resilience to meet todays unpredictable business challenges. It has more recently sought to shift toward cloud computing and catch up with its competitors, like Datadog, that started their business in the cloud. She can be reached at [email protected]. Then there's also the balance sheet. While the offer from Cisco is a nice indicator of Splunk's value, as a Splunk shareholder, I really hope management rejects the offer or demands a much higher price. [Related: Cisco Powers Hybrid Work With Private 5G, New Wi-Fi 6E And Catalyst Series]. Should a deal for Splunk be consummated it would be by far Cisco's largest ever. Cisco is reportedly eyeing a Splunk acquisition. That bidder was Sycamore Partners, a . Cisco Has Discussed Deal for Software Company Splunk. Anyone can read what you share. Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Cisco did not immediately respond to a request for comment. Pekka Lundmark, Nokia Brand Reveal, Mobile World Congress Barcelona 2023. We use cookies to ensure you get the best experience on our website. The Motley Fool has a disclosure policy. See why organizations around the world trust Splunk. In 2020, asset management went on a shopping spree. You will be charged Splunk's software collects, analyzes and visualizes real-time and historical machine data from any source. Cisco Systems has held acquisition talks with Splunk, whose software mines data for insights, including security threats. 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. Founded in the era of data centers, it has struggled to fully transition to the cloud and adjust its pricing model. 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. 2005 - 2023 Splunk Inc. All rights reserved. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. We are constantly evaluating potential opportunities. You will be notified in advance of any changes in rate or terms. Splunk Inc. is an American software company based in San Francisco, California, that produces software for searching, monitoring, and analyzing machine-generated data via a Web-style interface. Across 2020, Splunk's cloud business represented nearly half of the company's software bookings, enabling organizations to migrate workloads and applications to the cloud, manage colossal spikes in data volume or increase visibility into cloud security risks. The stock's still trading below its 50-, 100-, and 200-day moving averages after a Christmas period in which you'd have expected the stock to rebound amid a 2.8% . A statement of beneficial ownership of common stock by certain persons. Head over to the Spiceworks Community to find answers. Other tech companies have made that transition in the past, but when they do undertake this transition, they will initially show revenue declines, as larger multi-year deals are replaced by smaller annual but recurring revenue. Before that, he spent more than 11 years as an anchor, reporter and managing editor in television newsrooms in North Dakota and Washington state. According to Futurum Research, the deal would be a good fitOpens a new window for both companies. 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? Our servers do not recognize your request. People close to the company said the talks occurred recently, according to the Journal. 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. At the peak of its after-hours move, Splunk was valued at more than $20 billion, up from $18.2 billion at the close of trading. Do you still have questions? They said I didn't meet their bar for principal but P4-high. 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'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. a GAAP operating loss of $780 million in 2021. Daily chart of Splunk stock. Directly supervise a team of 15 global staff consisting of product, delivery . 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. Watch: Retired Army Col. Paris Davis Awarded Medal of Honor, Why Barnes & Noble Is Copying Local Bookstores It Once Threatened, What Floridas Dying Oranges Tell Us About How Commodity Markets Work. All Rights Reserved. This allows me to propose solutions that help my clients. IDC forecasts data creation and replication will grow at a 23% annualized growth rate from 2020 to 2025, and that acts as a powerful tailwind for the industry. The combination could create a security powerhouse that would combine Ciscos strength in network security with San Francisco-based Splunks strength in data-focused security operations. This page tracks and reports on important merger news in real-time . 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. Shares of Splunk have fallen 49% since reaching a record in September 2020. VictorOps acquired by Splunk . Give . This Is the Largest Merger of the Past 20 Years. Customer Service. 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. Customer Service. New rumors indicate that Microsoft's acquisition of gaming companies does not seem to have stopped. The offer was made recently and the companies are not in active talks, the newspaper said, citing some of the sources. Sapana Maheria, practice head of Thematic Research at GlobalData, believes that if the acquisition goes through, it will bode wellOpens a new window for further big-ticket mergers and acquisitions in the cybersecurity sector in the year ahead, especially in the behavioral analytics space. San Jose, Calif.-based Cisco did not respond to CRNs request for comment on the alleged deal by publication time. Cisco CEO Chuck Robbins. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. Splunks acquisition of Caspida adds Behavioral Analytics to Splunks security portfolio and expands our ability to address a broader set of security challenges faced by customers including advanced threats, insider threats and fraud. Sep 12, 2021. eric kocher generation kill; blue shield of northeastern ny claims address; alycia debnam carey siblings; cauliflower jalapeno nobu; Splunks acquisition of KryptonCloud expands Splunks ability to innovate for IoT use cases with our market-leading machine data platform. Cloud annual recurring revenue (ARR) has been off to the races and was up 83% year over year in Q1 fiscal 2022 to $833 million, but these changes have throttled overall revenue expansion. Splunk's software collects data logs and can give an enterprise added insight into operations, security, and application performance. Access timely security research and guidance. The offer was . Still, it does not have currently have a . 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.