The offer was . As a reminder, debt converted into new stock dilutes ownership for existing shareholders. The reported Cisco-Spunk deal could position the company as a much more formidable security player with competitor Palo Alto Networks. Chuck Robbins, CEO, Cisco Systems, speaking at the World Economic Forum, Davos, Switzerland, January 21, 2020. SAN FRANCISCO and .conf20 - October 20, 2020- Splunk Inc. (NASDAQ: SPLK), provider of the Data-to-Everything Platform, today announced that it has completed the acquisition of Plumbr, an application performance monitoring (APM) company offering auto-instrumentation, Real User . However, Splunks investors reacted positively to the news, with the companys stock price jumping 9% on the morning of February 14. Our robust order strength, record backlog and double-digit growth in annual recurring revenue position us well to deliver growth, said Chuck Robbins, chair and CEO of Cisco. San Jose, Calif.-based Cisco did not respond to CRNs request for comment on the alleged deal by publication time. Discover what Splunk is doing to bridge the data divide. *Average returns of all recommendations since inception. 10 . We would love to hear from you! You may change your billing preferences at any time in the Customer Center or call As of this writing, shares are down nearly 30% over the last 12-month stretch compared to a 36% run for the S&P 500. Additionally, cloud revenue has a lower gross margin than term software licenses, but that's generally made up for in higher growth. Founded in the era of data centers, it has struggled to fully transition to the cloud and adjust its pricing model. It will also affirm Ciscos projected dominance in the sector in the years ahead. Splunks acquisition of Cloudmeter adds new capabilities to Splunk products that enable customers to analyze machine data directly from their networks and correlate it with other machine-generated data to gain insights in application and infrastructure management, IT operations, security and business analytics. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Is this the software value stock for you too? Such a deal would be the largest ever for Cisco . Every sell-side analyst on Wall Street has a higher price target than . splunk acquisition rumors 2020lakeland correctional facility splunk acquisition rumors 2020. matthew 13:11 studylight; what game do bakers like to play. Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks. Cisco's offer comes when Splunk is actively hunting for a new CEO following . At the end of April, the company had $1.88 billion in cash, equivalents, and investments, offset by convertible notes of $2.33 billion. New rumors indicate that Microsoft's acquisition of gaming companies does not seem to have stopped. 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. Ciscos planned acquisition of Splunk has received favorable reactions from industry analysts. Accelerate value with our powerful partner ecosystem. 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. 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. 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. The company also made four cloud-related acquisitions in 2020. Discover what Splunk is doing to bridge the data divide. Cisco Has Discussed Deal for Software Company Splunk, https://www.nytimes.com/2022/02/11/technology/cisco-splunk.html. San Jose, CA-headquartered Cisco Systems, Inc. has reportedly offered $20 billion-plus to acquire data analytics giant Splunk. See why organizations around the world trust Splunk. During the years prior going back to 2017, Cisco closed between . Doug Merritt, Splunk's CEO for the past six years, stepped down in November. See here for a complete list of exchanges and delays. Every sell-side analyst on Wall Street has a higher price target than Friday's close, with the lowest at $120 per share, and the highest at $225 per share, with the average at $162. Listen to article. However, cash on hand and positive free cash flow will fund that new $1 billion share repurchase program, which should help boost earnings per share over time. This page tracks and reports on important merger news in real-time . A spoksperson for Splunk cited its policy not to comment on rumors or speculation. The board named Chairman Graham Smith as interim CEO and kicked off a search for a permanent replacement. Here's how they differ, Bank of America loves this under-the-radar streaming stock out of China, sees 30% gain. Management expects to be in the black for the balance of the year ahead, so that's good news. For every deal we do, we probably look at 10-15 companies. Right now, Splunk stock is giving traders a potential breakout from its current trading range, as well as a monthly-up rotation over the January high of $124.72. All quotes delayed a minimum of 15 minutes. Momentum Just Isn't Happening. Splunk shares rose as much as 14% in extended trading after a report about an acquisition offer from Cisco. The data log management and monitoring software leader has also trailed behind its smaller higher-growth and cloud-native peers as it adapts its business to more modern customer needs. In June, the private-equity firm Silver Lake invested $1 billion in Splunk to help with that transition. Opinion: Yes, Theres a Housing Crisis. These rankings reflect its credentials and dominance in the space. She, however, added a word of caution. Splunk (SPLK -1.40%) has been a severe underperformer in the last year. Splunk is currently unprofitable, and the stock has been unable to bounce back from last year's challenges with this interest rate cloud hanging over it. 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 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 has remained stable since at around $122 per share. Necessary and Functional Cookies - These cookies are necessary for the Site to function and cannot be switched off in our systems. 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. We continue to see incredibly strong demand across our portfolio, emphasizing the criticality and relevance of Ciscos innovation. (if applicable) for The Wall Street Journal. As a subscriber, you have 10 gift articles to give each month. Already a member? The notes have an annual interest rate of just 0.75% per year payable to Silver Lake, and they mature in July 2026 if they haven't been repurchased or redeemed by then. No, You Cant Build Here, Opinion: About Those Free Tickets to Hong Kong, Opinion: China Remains the Worlds Pandemic Risk. Shares of Splunk have fallen 49% since reaching a record in September 2020. Cisco is reportedly eyeing a Splunk acquisition. At this price, it appears Cisco would be getting a steal, unless the price winds up being a lot higher than the $20 billion reported. Requested URL: www.sdxcentral.com/articles/analysis/who-will-cisco-buy-instead-of-splunk/2022/02/, User-Agent: Mozilla/5.0 (Windows NT 6.1; Win64; x64) AppleWebKit/537.36 (KHTML, like Gecko) Chrome/103.0.0.0 Safari/537.36. According to The Wall Street Journal, Cisco (Nasdaq: CSCO) has made a "takeover offer" of more than $20 billion for Splunk, a software maker. Our Standards: The Thomson Reuters Trust Principles. The people requested anonymity because the information is confidential. 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. We are constantly evaluating potential opportunities. Splunk would be a perfect target for its ambitions, and would be Cisco's biggest acquisition ever, about triple (or more) the $7 billion acquisition of Scientific Atlanta back in 2005. acquisition-related adjustments, amortization of intangible assets and . 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 . This includes computing devices, control systems, sensors, or anything else connected . Access timely security research and guidance. 4. Given that Silver Lake has a seat on the board of directors, it would probably be difficult for it to vote for any acquisition below that $160 price. A 24/7 Wall St. analysis reveals that the largest merger deal of the past two decades was worth more than $128 billion. a 17% rise in net income and a 6% rise in revenue in Q2 2022 against Q2 2021. Gina Narcisi is a senior editor covering the networking and telecom markets for CRN.com. Splunk has positioned itself as the leader in helping large enterprises manage and monitor their IT systems. 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. Jun 11, 2018 . Build, own, manage and support B2B and B2C web and mobile properties. 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. He said mergers such as Invesco's 2019 acquisition of OppenheimerFunds, Janus's 2017 deal with Henderson, and even 2020 Franklin Templeton's merger with Legg . Cisco and Splunk representatives declined to comment. Last week, Rigor's acquisition by Splunk was announced and it's a testament to Craig and his team for building an . But the advent of the cloud has shifted these needs away from legacy IT systems, and Splunk wasn't exactly ready for the change. Making the world smarter, happier, and richer. We use cookies to ensure you get the best experience on our website. Cisco has sought to expand its security business while also selling data center networking equipment and Webex collaboration software. 2005 - 2023 Splunk Inc. All rights reserved. Dropbox revenue for the twelve trailing months ending September 30, 2020 was $1.856B, a 16.63% increase year-over-year. The Wall Street Journal reported the potential deal earlier on Friday. 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. Speaking of Splunk and acquisition rumors, I was surprised that Robbins wasn't quizzed more about the rumored Splunk acquisition. These are the highest quality stocks in the S&P 500 that could win in this volatile market, This growth ETF is leaving one of its top competitors in the dust. 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. Cisco did not immediately respond to a request for comment. The potential deal could position Cisco to compete with security leader Palo Alto Networks in the security operations space. 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. Douglas A. McIntyre. Splunk's software collects data logs and can give an enterprise added insight into operations, security, and application performance. Cost basis and return based on previous market day close. Ciscos Bold Move to Boost Cybersecurity M&As in 2022, Sapana Maheria, practice head of Thematic Research at GlobalData, believes that if the acquisition goes through, it will. TechCrunch. You will be notified in advance of any changes in rate or terms. This Splunk shareholder hopes management holds out for a much higher price than was reported. The notes only bear an interest rate of 0.75%, but convert to equity at $160 per share. 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. 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. Splunk's software has gained popularity as a tool for spotting security threats. 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. In that light, it's no wonder Cisco may see an opportunity to swoop in at this time of transition and uncertainty to take Splunk for itself. Cisco was built on its leading position in enterprise hardware, but has made a big strategic effort to buy its way into the more stable software space. That's a change from its traditional business model of selling perpetual software licenses, deployed in customers' data centers. Data is a real-time snapshot *Data is delayed at least 15 minutes. Its past deals include Acacia, a maker of optical network components; Luxtera, a semiconductor company; and ThousandEyes, a cloud intelligence company. Save Search . The offer was made recently and the companies are not in active talks, the newspaper said, citing some of the sources. Cisco Systems, the technology conglomerate, has held discussions with the software company Splunk about buying it, although no deal is currently on the table, two people familiar with the matter told The New York Times on Friday. Splunks acquisition of KryptonCloud expands Splunks ability to innovate for IoT use cases with our market-leading machine data platform. Splunk Application Performance Monitoring. eric kocher generation kill; blue shield of northeastern ny claims address; alycia debnam carey siblings; cauliflower jalapeno nobu; Splunk experts provide clear and actionable guidance. You can see Splunk's revenue took a dip in 2020 as it went through the trough of this transition. First of all, Splunk is far off from its all-time highs, down about 48% from its 2020 highs at the end of trading on Friday. Billy Duberstein owns Amazon and Splunk. The Silicon Valley-based tech investor recently plopped $1 billion down on Splunk, a significant cash infusion given Splunk's current enterprise value sits at $23 billion. Read the Wall Street Journal report here. Splunks acquisition of SignalSense enables Splunk to further innovate in our market-leading machine data platform and expands Splunks expertise in machine learning and cloud applications. With dominant position in multiple on-premise markets, Ciscos valuation has been held back by more gradual moves toward the cloud and the revenue transition from opex vs. capex focused IT. 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. Initial filing by director officer or owner of more than ten percent. The report cited people familiar with the matter and did not say where the potential deal stands. Read more . Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. Splunk jumped up 16 percent post-market on reports of the takeover bid. To make the world smarter, happier, and richer. Then there's also the balance sheet. 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. Statement of changes in beneficial ownership of securities. It's pretty likely Silver Lake didn't invest in Splunk to make 0.75%, but rather to make big money on the conversion. 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? According to Futurum Research, the deal would be. Splunks acquisition of Drastin expands Splunks search-driven analytics capabilities and enhances our ability to provide an intuitive search experience for our customers. See why organizations around the world trust Splunk. a GAAP operating loss of $780 million in 2021. Total revenue at Splunk grew 19% from a year earlier, while Cisco's overall revenue in the most recent quarter increased 8%. Silver Lake Chairman and Managing Partner Kenneth Hao will also join Splunk's board of directors to help guide the company's journey. The offer exceeds Splunks current market capitalization by $2 billion, but reports indicate the two companies havent discussed it yet. Concurrent with Silver Lake's investment, Splunk said it will also begin executing a new $1 billion share repurchase plan (which should help offset any future conversion of the debt into new stock).