Cisco Hints that Splunk Deal Not Happening
Cisco reported its second-quarter fiscal year earnings on Wednesday, projecting 5.5% to 6.5% revenue growth for the year. It also increased its share buyback by $15 billion and downplayed any idea that it's in the market for a large acquistion, such as the $20 billion (or more) deal for Splunk that had recently been rumored in the market.
When asked about a potential Splunk deal during the Q&A of the earnings conference call on Wednesday, Cisco CEO Chuck Robbins said that the company is "constantly evaluating opportunities." But he seemed to downplay the idea that Cisco would part with the $20 billion or more that would be required to buy Splunk, which would make it Cisco's largest acquisition ever. "You should expect us to be very disciplined going forward," said Robbins.
No Splunk for Cisco?
"Being very disciplined" sounds like code words for "no thanks."
Splunk, a data analytics software company, has a market capitalization of $20 billion, but it is not profitable and would be a turnaround project. They company lost about $1.5 billion in the past year.
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