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Cisco Buying Splunk?

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Cisco Systems has offered to acquire Splunk for $20 billion, though the two companies are not in active M&A talks, The Wall Street Journal reported.

It's unclear why the M&A offer leaked into The Journal -- though the end result is clear: Splunk's stock price jumped amid the rumor. And if rival bidders emerge, it's a safe bet the offers will need to be at least $20 billion -- or framed in a way that surpasses the Cisco bid.

Splunk Striving to Transform Business

The M&A rumor comes amid challenging times for Splunk. Though still growing, Splunk in November 2021 announced a CEO change from Doug Merritt to interim CEO Graham Smith. That move came amid Splunk's challenging shift toward a more cloud- and subscription-based business. To assist the transition, Silver Lake invested $1 billion in Splunk in mid-2021.

More recently, MSP technology and cloud backup provider Datto in early 2022 hired Splunk channel veteran Brooke Cunningham as chief marketing officer.

Speculation about a potential Cisco-Splunk tie-up has surfaced multiple times over the years. Indeed, Splunk's data analytics expertise is considered complementary to Cisco AppDynamics, some reports have suggested.

Splunk: Most Recent Quarterly Revenues

Splunk's total revenues were $665 million in Q3 of 2022, up 19% compared to Q3 of 2021, according to financial results delivered on December, 2021.

Cisco is expected to report its fiscal second-quarter earnings on February 16, while Splunk is scheduled to report on March 2, The Journal noted.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.