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. During the years prior going back to 2017, Cisco closed between . Published Dec. 1, 2020 Updated Jan. 4, 2021. The company also made four cloud-related acquisitions in 2020. See why organizations trust Splunk to help keep their digital systems secure and reliable. 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. The potential deal could position Cisco to compete with security leader Palo Alto Networks in the security operations space. Cost basis and return based on previous market day close. a 17% rise in net income and a 6% rise in revenue in Q2 2022 against Q2 2021. 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. 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. Will the acquisition of Splunk change things? for both companies. We've been tracking company news on mergers and acquisitions since 1999. Ciscos market capitalization is $227 billion. Prior to joining CRN, she covered the networking, unified communications and cloud space for TechTarget. Read more . This Is the Largest Merger of the Past 20 Years. 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 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. 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. Splunks stock price fell 20% over a six-month period, and the company. Splunk jumped up 16 percent post-market on reports of the takeover bid. 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). See why organizations trust Splunk to help keep their digital systems secure and reliable. 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 . List of Splunk 's 16 Acquisitions, including TwinWave and TruSTAR. This Splunk shareholder hopes management holds out for a much higher price than was reported. A rumored Mandiant acquisition discussion may hint at Microsoft's 2022 kickoff to major cybersecurity firm buys. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Its chief executive, Chuck Robbins, told analysts in December that Cisco would continue to look for acquisitions in security. Splunk has positioned itself as the leader in helping large enterprises manage and monitor their IT systems. 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). The Motley Fool has a disclosure policy. Statement of changes in beneficial ownership of securities. Though it's been beat down in the last year, Splunk operates as the leader in a growing industry and could be a real long-term value for those who can patiently wait out the inevitable bumps in the road. Splunks acquisition of BugSense enhances our product offerings so that customers can analyze machine data directly from mobile devices and correlate it with other machine-generated data to gain Operational Intelligence. Splunk experts provide clear and actionable guidance. The reported Cisco-Spunk deal could position the company as a much more formidable security player with competitor Palo Alto Networks. Rigor's monitoring and optimization solutions complement the other Splunk offerings. Splunks acquisition of Streamlio accelerates Splunk's efforts in real-time stream processing and containerized multi-tenant cloud platform applications expanding Splunk's commitment to and participation in the open source software community. Data is a real-time snapshot *Data is delayed at least 15 minutes. Cloudmeter. Cisco is reportedly eyeing a Splunk acquisition. Customer Service. Splunk named after spelunking, the sport of cave exploring mines data for insights, including security threats, a business that grew in importance as the coronavirus pandemic quickly forced many workers online. Total revenue at Splunk grew 19% from a year earlier, while Cisco's overall revenue in the most recent quarter increased 8%. 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% . Dropbox is a 9.3 billion market cap company. That certainly indicates the new cloud offerings are very successful with customers. Splunk's software collects data logs and can give an enterprise added insight into operations, security, and application performance. [Related: Cisco Powers Hybrid Work With Private 5G, New Wi-Fi 6E And Catalyst Series]. Plan your migration with helpful Splunk resources. This allows me to propose solutions that help my clients. Splunk vs Uber I got the final offer from Splunk (P4: 230k, 15%, 440k/3yrs, TC=411k), probably the highest offer for P4. Billy Duberstein owns Amazon and Splunk. 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. Cisco is using acquisitions to help it grow . Opting out of these cookies may impact some minor site functions. Learn More. However, Splunks investors reacted positively to the news, with the companys stock price jumping 9% on the morning of February 14. Th ecompany serves four primary markets: wired infrastructure, wireless communications, enterprise storage, and industrial & others. The biggest was IBM's $34 billion purchase of Red Hat in 2018, followed by Microsoft's $27 billion acquisition of LinkedIn in . Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. Give . 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. 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. Alex Murdaughs Trial Lasted Six Weeks. . 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. Without these cookies, our Services won't work properly or won't be able to provide many features and functionality. With a price to sales ratio of 5.6. VictorOps . Splunk Application Performance Monitoring, EX-101.SCH - XBRL TAXONOMY EXTENSION SCHEMA. The offer was made recently and the companies are not in active talks, the newspaper said, citing some of the sources. How far over that figure will determine whether the acquisition goes through or not. Just to provide a sense of the activity, Cisco conducted nine acquisitions in 2020, six in 2021, and has conducted one YTD in 2022. Pundits speculate that Google parent Alphabet could acquire ServiceNow, Atlassian, Splunk or perhaps Zayo.. Big banks and activist investors snapped up shops, there were mega-mergers between one-time rivals, and subsidiaries spun off. See here for a complete list of exchanges and delays. Additionally, cloud revenue has a lower gross margin than term software licenses, but that's generally made up for in higher growth. Ciscos planned acquisition of Splunk has received favorable reactions from industry analysts. All Rights Reserved. SAN FRANCISCO Salesforce said on Tuesday that it would buy the workplace software company Slack for $27.7 billion in cash and stock, the latest in . Total revenue in Q1 2022 was up just 16% from a year ago to $502 million, a decent rally after overall revenue fell 5% last year. Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks. We would love to hear from you! Last week, Rigor's acquisition by Splunk was announced and it's a testament to Craig and his team for building an . I think Splunk is a very lucrative acquisition target for several major players including . That's a change from its traditional business model of selling perpetual software licenses, deployed in customers' data centers. acquisition-related adjustments, amortization of intangible assets and . And over the past few years, Splunk has made a number of tuck-in acquisitions to enter into the hot observability space, which allows corporations to monitor the health of software applications, in addition to IT infrastructure. You do not have access to www.sdxcentral.com. Vlocity gave . Cisco CEO Chuck Robbins. Every sell-side analyst on Wall Street has a higher price target than . , which broke the news on February 11, the two companies havent gotten around to discussing the acquisition yet. Company Location: U.K. Press Release: 1/30/2020 Xerox Acquires Arena Group, Expands Presence in European SMB Market. 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. 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. Craig is a proud Husky, having graduated from the University of Washington. Still, it does not have currently have a . 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. Several years ago, Splunk began to deploy its offering via the cloud on a subscription basis. He is best known in the industry for his stint as the chief financial officer and later executive vice president at Salesforce. We want to hear from you. Splunk, whose stock price has fallen by 30 percent since its chief executive, Doug Merritt, unexpectedly stepped down in November, has a market capitalization of around $18 billion. Cisco and Splunk have been in the news since last week when The Wall . So Splunk appears to have staying power, and is bound to benefit from the growth of the enterprise data analytics industry this decade. 2023 CNBC LLC. 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. The notes only bear an interest rate of 0.75%, but convert to equity at $160 per share. Let us know if you enjoyed reading this news on LinkedInOpens a new window , TwitterOpens a new window , or FacebookOpens a new window . Splunks acquisition of KryptonCloud expands Splunks ability to innovate for IoT use cases with our market-leading machine data platform. SignalFx . No, You Cant Build Here, Opinion: About Those Free Tickets to Hong Kong, Opinion: China Remains the Worlds Pandemic Risk. 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. 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. A deal may not happen at all, but if talks resume, Cisco could pay more than $20 billion for Splunk, one of the people said. Making the world smarter, happier, and richer. Invest better with The Motley Fool. SEC Filings. Mobile World Congress (MWC) is back in a big way and delivered the 5Goods (my clever play on words) on many . Directly supervise a team of 15 global staff consisting of product, delivery . The site owner may have set restrictions that prevent you from accessing the site. Splunk said it does not comment on rumors or speculation. So Splunk has been able to capture over 90 of the Fortune 100 companies as customers, even in spite of new cloud-based competition. Do you still have questions? We are delighted that you'd like to resume your subscription. 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. Splunk is well off its highs and seems undervalued.