In some cases, you can identify forward-looking statements by terms such as anticipate, believe, estimate, expect, intend, may, might, plan, project, will, would, should, could, can, predict, potential, target, explore, continue, or the negative of these terms, and similar expressions intended to identify forward-looking statements. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. It is not decrypted until it reaches the recipients devices. These end-to-end encrypted meetings will not support phone bridges, cloud recording, or non-Zoom conference room systems. Zoom does not and will not proactively monitor meeting contents, but our trust and safety team will continue to use automated tools to look for evidence of abusive users based upon other available data. Zoom Video Communications ZM recently announced the acquisition of assets from Liminal a start-up offering an event production solution. "It allows them to use their currency to buy things that are impactful," said Alfred Chuang, a partner at venture firm Race Capital who previously co-founded BEA Systems and sold it to Oracle for $8.5 billion in 2008. The cryptographic secrets will be under the control of the host, and the hosts client software will decide what devices are allowed to receive meeting keys, and thereby join the meeting. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Facebook, Microsoft, and Zoom Video Communications. The company recently laid off 60 . Zoom swung for the fences last summer when its stock value was soaring, offering almost $15 billion to buy Five9 to get . We are proud to announce the acquisition of Keybase, another milestone in Zooms 90-day plan to further strengthen the security of our video communications platform. Zoom also shuffled internal responsibilities this year, putting CFO Kelly Steckelberg in charge of business development, a job that had previously been held by operating chief Aparna Bawa, people close to the matter said. The best option may be selling the company, and three rivals make sense as acquirers. Zoom Video Communications, Inc. All rights reserved. In a bid to assuage privacy concerns, video conferencing giant Zoom today acquired encrypted messaging and file-sharing platform Keybase.. I have invited Andy Carluccio (Liminal Co-Founder), Jonathan Kokotajlo (Liminal Co-Founder), and Sam Kokajko (Zoom Event Specialist Team, Manager) to the Zoom Test Kitchen on Friday, December 31st at 3:00 pm eastern.. Making the world smarter, happier, and richer. SAN JOSE, Calif.and SAN RAMON, Calif., July 18, 2021(GLOBE NEWSWIRE) -- Zoom Video Communications, Inc.(NASDAQ: ZM) today announced it has entered into a definitive agreement to acquire Five9, Inc.(NASDAQ: FIVN), a leading provider of the intelligent cloud contact center, in an all-stock transaction valued at approximately $14.7 billion. "The thesis in favor of acquisition would be to pick up the asset on the cheap since it's lost so much. This could make the entire Salesforce ecosystem more valuable. Yuan went a step further in June on Zoom's quarterly earnings call. "A Zoom acquisition is unlikely due to a number of factors," Bonner said in an email. Five9 shareholders rejected Zoom 's acquisition because the offer did not appropriately value the cloud contact center software company, Five9s chief . Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are included under the caption Risk Factors and elsewhere in our most recent filings with the Securities and Exchange Commission (the SEC), including our annual report on Form 10-K for the year ended January 31, 2020. Brent Leary, principal analyst and founder at CRM Essentials, who watches the customer service space, says that this may be a more practical deal than the one with Five9. If a company is already using Microsoft or Google, it may want to stick to that platform and eventually cut Zoom from its subscriptions, which is a challenge for Zoom as it doesn't have the same suite of solutions to offer as larger competitors. This acquisition marks a key step for Zoom as we attempt to accomplish the creation of a truly private video communications platform that can scale to hundreds of millions of participants, while also having the flexibility to support Zooms wide variety of uses. "Overall, we are encouraged by Zoom's strategy to supercharge its platform with this acquisition rather than rely purely on its own internal R&D chops, which would have taken years to scale," wrote VanVliet, who has a buy recommendation on Zoom, in a report on July 19. Eric Yuan, founder and chief executive officer of Zoom Video Communications Inc., speaks during the BoxWorks 2019 Conference at the Moscone Center in San Francisco, California, U.S., on Thursday, Oct. 3, 2019. Representatives from Zoom and Five9 declined to comment. Data is a real-time snapshot *Data is delayed at least 15 minutes. Zoom's market cap, meanwhile, was about $116 billion, over five times its value at the beginning of 2020. Zoom will offer an end-to-end encrypted meeting mode to all accounts. The company was reliant on a single product and had completed just one tiny acquisition. In July, Zoom hired Abhisht Arora, a 21-year Microsoft veteran and Teams program manager, as its head of corporate strategy, reporting directly to Yuan. As the company wrote in a blog post announcing the new service: Combining contact center functionality with Zoom unified communications solutions, Zoom Contact Center can operate as a standalone customer experience solution or integrate directly into an existing website or application. "When you have a very fast-growing company and become very successful, most people don't want to rock the boat," he said. Yuan was a lead engineer at WebEx when the company was acquired by Cisco in 2007, and Five9 CEO Rowan Trollope ran all of Cisco's collaboration products, including WebEx, until taking the Five9 job in 2018. Five9 adds a projected $650 million in revenue next year to the $4.8 billion in sales that analysts expect from Zoom, according to StreetAccount. Keybases experienced team will be a critical part of this mission. We want to hear from you. 2022 2021 2020 2019 2018 2017 2015. Zoom, the video-conferencing platform that became hugely popular during the Covid-19 pandemic, is spending a whopping $14.7 billion on cloud-based software company Five9 to boost its appeal with. Zoom stock is up over 9% in early trading this morning. Bawa has assumed increased responsibilities elsewhere in the business. Cramer on Zoom-Five9: People like the deal due its cloud-based service, Zoom CFO Kelly Steckelberg on plans to innovate for a post-pandemic world, Zoom's acquisition of Five9 is a 'steal of a deal,' says analyst, Zooms acquisition of Five9 is a steal of a deal, says analyst. Discovery CEO David Zaslav addressed a company-wide town hall meeting via Zoom on Wednesday and stated flatly, "We are not for sale, absolutely, not for sale." The speculation about a possible Comcast-WBD merger dates back to the summer of 2021 , when Zaslav and Comcast CEO Brian Roberts met at the Allen . Transaction Marks Key Milestone in Zoom's 90-Day Security Plan SAN JOSE, Calif. and NEW YORK, May 07, 2020 (GLOBE NEWSWIRE) -- Zoom Video Communications, Inc. (NASDAQ: ZM) and Keybase today announced that Zoom has acquired Keybase, a secure messaging and file-sharing service. But lately, Wall Street has been asking for more and pushing. The company has now lost an opportunity to quickly broaden its capabilities after its stock rallied during the coronavirus pandemic. While some large tech acquisitions, most notably in the semiconductor industry, have been nixed of late by regulators, it's highly unusual for companies to willingly terminate their own deal. In what subsequently became the biggest tech deal of the year, Square agreed to buy Australia's Afterpay for $29 billion, equaling a 30% premium. Given the momentum in cloud software and all the money investors have poured into Five9's peers, a significantly higher premium was likely expected. All Rights Reserved. Fresh off its $14.7 billion acquisition of customer contact center Five9 Inc. earlier this week, Zoom Video Communications Inc. is apparently holding discussions about investing in a special. "The way we approach that today is through partnering. Zoom soared past $100 billion in market cap without ever doing a significant acquisition or finding a second meaningful source of revenue. We also do not have a means to insert our employees or others into meetings without being reflected in the participant list. Our customers will benefit from an automated, integrated, and easy-to-deploy contact center, which will help answer end-customers questions and solve issues faster improving the overall customer experience and driving operational savings, Sankarlingam wrote in a blog post announcing the deal. "That said, it was in no way foundational to the success of our platform, nor was it the only way for us to offer our customers a compelling contact center solution.". Since its launch in 2014, Keybases team of exceptional engineers has built a secure messaging and file-sharing service leveraging their deep encryption and security expertise. List of Zoom 's 4 Acquisitions, including Solvvy and Liminal Save Search Companies Contacts Investors Funding Rounds Acquisitions People Events Schools Hubs Saved Acquirer Name Add Acquisitions filter includes any Zoom E.g. Additionally, some features that are widely used by Zoom clients, such as support for attendees to call into a phone bridge or use in-room meeting systems offered by other companies, will always require Zoom to keep some encryption keys in the cloud. I mentioned that Microsoft already has a big presence in enterprise video conferencing, but buying Zoom would make it the dominant player. Zoom swung for the fences last summer when its stock value was soaring, offering almost $15 billion to buy Five9 to get into customer service. Oct 4 (Reuters) - Zoom Video Communications Inc's (ZM.O) aborted $14.7 billion acquisition of call center software firm Five9 Inc (FIVN.O) has spotlighted issues that will . We are also investigating mechanisms that would allow enterprise users to provide additional levels of authentication. Here's the 1 Social Security Change in 2023 That's Going to Hurt the Worst. Zoom's goal is to be not only a video service used for meetings with co-workers and clients, but to become the center of all work communication, including for customer service reps in call centers. Though the rumored $5 billion price tag would be more than Zoom currently has on hand, they would be able to leverage to make the deal. The problem in enterprise software is that companies are looking for fewer solutions and more functionality from the tools they have. Our goal is to provide the most privacy possible for every use case, while also balancing the needs of our users and our commitment to preventing harmful behavior on our platform. And Zoom is taking advantage, announcing earlier this week the $14.7 billion purchase of Five9, which sells cloud-based software to call centers. CNBC's Alex Sherman contributed to this report. To help fix that problem, Zoom whose stock trades 35% below its October 2020 high announced it would pay $14.7 billion in stock to acquire Five9, a cloud-based customer-service software . We will then host discussion sections with civil society, cryptographic experts, and customers to share more details and solicit feedback. Zoom announced the deal earlier today, signifying that the video chat servicewhich has seen a massive surge in use in the midst of worldwide coronavirus lockdowns . ET, 5 Investment Opportunities With Over 700% Upside, According to Cathie Wood, 1 Green Flag for Zoom in 2022, and 1 Red Flag. Teams is clearly a product Microsoft is trying to grow and add features to, and as a leader in the enterprise market, it could choose to grow the product more organically. Copyright 2022 However, for hosts who seek to prioritize privacy over compatibility, we will create a new solution. Between development of new products and big acquisitions into parallel markets, Yuan is trying to ensure that Zoom is more than just a pandemic stock, and that its status as an enterprise giant remains long after we say goodbye to Covid-19. The company has built an. On the investor call following the announcement, Yuan and Trollope said that common customers have been telling them they want to count on a single vendor that can provide communications technology for internal purposes as well as customer service. Cost basis and return based on previous market day close. This communication contains express and implied forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to Zooms acquisition of Keybase that involves substantial risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed or implied by such statements. With revenue growth stalling out, Zoom needs to make something happen now or risk being pushed out of the market by bigger tech rivals. will not build any cryptographic backdoors to allow for the secret monitoring of meetings. Forward-looking statements in this communication include, among other things, statements about the potential benefits of the transaction, our development of our end-to-end encryption offering, our ability to integrate the Keybase team, and potential growth opportunities. Our goal is to provide the most privacy possible for every use case, while also . REUTERS/Carlo Allegri. Video chat and conferencing aren't new, but Zoom became a verb when the pandemic started, putting a new focus on the service. "When we do acquisitions, just by the way we finance them, it often takes us a handful . The Motley Fool has a disclosure policy. But Keybase users are not happyand some are even threatening to delete their accounts. Velchamy Sankarlingam, president of Product and Engineering at Zoom, certainly recognizes that this acquisition gives the company crucial functionality for competing in this space. Additionally, Zoom's stock has dropped 28% since deal was announced, while Five9 shares have fallen only 11%. Yuan and Steckelberg drove the Five9 deal, the people said. The video-conferencing software company announced it's IPO priced at $36 per share, at an estimated value of $9.2 billion. Since its launch in 2014, Keybases team of exceptional engineers has built a secure messaging and file-sharing service leveraging their deep encryption and security expertise. April 2022. The company's planned $14.7 billion purchase of Five9. Forward-looking statements speak only as of the date the statements are made and are based on information available to Zoom at the time those statements are made and/or managements good faith belief as of that time with respect to future events. I highlighted last week that Facebook is trying to make its VR collaboration app Workrooms an enterprise solution that augments its Slack-like platform called Workplace for businesses. We are excited to integrate Keybases team into the Zoom family to help us build end-to-end encryption that can reach current Zoom scalability. "Acquisitions are not only useful to acquire customers but are super critical to satisfy a product vision you may have.". Should You Buy the 5 Highest-Paying Dividend Stocks in the S&P 500? We. Salesforce's COO denied the . If Facebook could acquire Zoom and leverage it to become an enterprise solution, it could develop Workplace and virtual reality for serious business use. Lyft (NASDAQ: LYFT) stock has been rising on the back of rumors of acquisition from an activist investor. Encryption keys will be tightly controlled by the host, who will admit attendees. If Zoom's stock continues to fall, I could see it becoming a hot acquisition target. all all. Five9 to remain a stand-alone company? The acquisition will help . As these big enterprises saw the success of Zoom, they copied parts of its product and folded video conferencing into their suite of tools, hoping to wedge Zoom out of the market. 4 Growth Stocks I've Aggressively Bought Before the Next Bull Market Begins, Join Nearly 1 Million Premium Members And Get More In-Depth Stock Guidance and Research, Motley Fool Issues Rare All In Buy Alert, expects revenue of $1.015 billion to $1.02 billion in the third quarter, Facebook is trying to make its VR collaboration app Workrooms an enterprise solution, Copyright, Trademark and Patent Information. While it may make a lot of sense for Microsoft to buy Zoom, the company may also decide it's fine just slowly adding features to Teams and pushing Zoom out of its customers' workflow that way. A Division of NBCUniversal. The company had $1.9 billion in cash and equivalents on its balance sheet at the end of July. Got a confidential news tip? Ultimately, the acquisition price was a modest 13% premium to Five9's last closing price before the announcement. 2022 CNBC LLC. Chuang, who has been friends with Zoom CEO Eric Yuan since his pre-Zoom days at WebEx, says Yuan is now in a position familiar to Salesforce CEO Marc Benioff, whose company has more than doubled in value since mid-2018 to $240 billion. Still, Zoom is among the 25-most valuable North American tech companies and the only one in that pack to go public in the last four years. Dec 28, 2021 10:36AM EST. Invest better with The Motley Fool. When Zoom topped the $100 billion mark last year, it had been public for just over 14 months. The deal is projected to close in the first half of 2022 and Trollope will continue to run Five9 as a president of Zoom. "Contactcenterisanabsolutelyreallyimportantpartofthephonestrategy," Steckelberg said in response. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. The Five9 deal is one of the 10 largest U.S. enterprise software transactions on record, according to FactSet, and is bigger than any acquisition ever by Amazon, Google, Oracle, Cisco or Adobe. Logged-in users will generate public cryptographic identities that are stored in a repository on Zooms network and can be used to establish trust relationships between meeting attendees. Zoom customers who use Zoom Meetings, Zoom Phone, and/or Zoom Chat will recognize the agent and supervisor interaction handling experience, as it is part of the same Zoom application. A big reason is that growth is slowing to a halt at Zoom. Zoom said in July that it was acquiring Five9 in an all-stock purchase for $14.7 billion, its first billion-dollar-plus purchase and, at the time, the second-biggest tech deal of the year. We will continue to work with users to enhance the reporting mechanisms available to meeting hosts to report unwanted and disruptive attendees. He responded to an analyst's question about contact center expansion by telling investors, "Stay tuned, you will see something." The New York Mets have spent $248.7 million this offseason on Cy Young winner Justin Verlander and hitter Brandon Nimmo.Throw in an additional $10 million for reliever David Robertson and no one . Editors note 6/19/20: We removed the word paid from the sentence in this blog Zoom will offer an end-to-end encrypted meeting mode to all paid accounts. Zoom has decided to offer E2EE to all of our users free and paid. 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. The CEOs, who both previously worked on collaboration products at Cisco, know each other well and forged a product integration in 2019, when Zoom launched a phone offering. Privacy & Legal Policies | Do Not Sell My Personal Information | Cookie Preferences. Editors note: This blog post was edited on Aug. 3, 2021 to include the most up to date information on Zoom encryption. We have great relationships with Five9. Shopify and Snap, which went public in 2015 and 2017, respectively, are the only companies in the group that trade for a richer multiple to sales. Zoom has lost about one-third of its value since then, despite reporting 191% revenue growth in the latest quarter, as investors prepare for a post-pandemic future and as competition picks up, most notably from Microsoft Teams. At a Morgan Stanley investor event in March, Steckelberg was asked about Zoom's plans for the call center. May 2022. We look to acquire products and technologies that, when combined with our data and insights, provide unrivaled value to our customers and shareholders. In complement to its failed merger's press release, Five9's management highlighted significant . At about 23 times Five9's expected 2022 revenue, it's also the second-priciest software deal on a price-to-sales basis, behind only Salesforce's $27 billion purchase of Slack, which closed earlier this month. Zoom and Five9, which had a product partnership prior to the acquisition agreement, said they will maintain support for the integrations. There's no guarantee that businesses would be excited to add Facebook as an enterprise solution, but this could be a big foot in the door -- and if Facebook truly has enterprise dreams, it may need to make a big move to get into the market. The. If your school is a Google school, it probably uses Google Meet for video calls. Data is a real-time snapshot *Data is delayed at least 15 minutes. By pulling together some existing functions, the company was able to offer a customer service experience inside the Zoom tool set. Because it's a stock swap, that means Five9 shareholders would have been receiving even less of a premium than at the agreed-upon price. With the recent Zoom 5.0 release, Zoom clients now support encrypting audio, video, chat, and screen sharing content using industry-standard 256-bit AES-GCM. Proxy advisory company Institutional Shareholder Services had recommended shareholders vote down the proposal, CNBC reported Sept. 17. He followed by suggesting that details could be revealed around the time of the company's Zoomtopia conference in September. The company acquired Slack in order to enter the enterprise communications market, and Zoom integrates into Slack already -- and could further entrench Salesforce as a business app. And unlike Facebook, Zoom would fold into Microsoft's existing services very nicely. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors. Buying Five9 "presented an attractive means to bring to our customers an integrated contact center offering," Eric Yuan, Zoom's founder and CEO, wrote in a blog post. We look forward to welcoming the Keybase team and are excited for the possibilities of what we can build together. Another acquisition attempt from Zoom wouldn't surprise me. Zoom became the most well-known video-conferencing app during the COVID-19 after gaining about 635 % in 2020. build a mechanism to decrypt live meetings for lawful intercept purposes. *Average returns of all recommendations since inception. Analysts like BTIG's Matt VanVliet said the decision to buy instead of build is the right one. By June 2020, the value of the company was $67 billion. And thats that, as the Zoom deal to buy Five9 is called off. So why is Zoom's stock down 42% from its all-time high, and in freefall after another strong quarterly report? explore acquisition. An ephemeral per-meeting symmetric key will be generated by the meeting host. Five9 also picked up customers that needed to set up remote and distributed call centers. Like with Microsoft, Slack and Zoom could be a great start to a small business's app suite, creating a feeder pipeline for the Salesforce platform. Zoom ( ZM -0.28%) was arguably the biggest winner from the pandemic, becoming not only an indispensable tool for schools and businesses but also a household name. Zoom said in July that it was acquiring Five9 in an all-stock purchase for $14.7 billion, its first billion-dollar-plus purchase and, at the time, the second-biggest tech deal of the year. The deal is expected to close in the third quarter of this fiscal year. Salesforce could cross-sell products to teams using either product, broadening its potential reach. A big reason the stock is down is that sequential revenue growth is stalling out to zero. One benefit I could see for Microsoft is that Zoom is a simple-to-use tool for small businesses that may not be using most of Microsoft's products today. These may be early signs that Zoom is finding it hard to grow its footprint in enterprise markets, and its best option may be to simply sell to a bigger rival. While it's still just a toddler on the Nasdaq, Zoom is now being forced to take on adult responsibilities for investors, thanks to its unexpectedly rapid ascent. Kites Team to Help Enhance Zoom's Machine Translation Capabilities. While the companies did not share a purchase price, Solvvy, which launched back in 2013, raised $16.5 million along the way, according to Crunchbase data. As we do this work to further protect our users privacy, we are also cognizant of our desire to prevent the use of Zooms products to cause harm. Five9 CEO explains why Zoom deal failed. We are very excited about the future possibilities and really want to learn more. "Ihopewewill be able todomore," he said, indicating that Zoom may go beyond integrations with call center technology providers. Conversational AI integration with Zooms communications platform seem like a nice combination that strengthens both sides and potentially creates better experiences for both customers and employees interacting with each other, he told TechCrunch. Zoom went public just two years ago, and the pandemic provided a major boon to its business, as customers rushed to sign up for its video chat software. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. Taylor, perhaps naturally, sounded unconcerned, suggesting that major acquisitions can take time to digest. Seagen (NASDAQ: SGEN) is down 3.3% in pre-open trading following news it named David R. Epstein as CEO, which is dashing M&A hopes. She oversees security, privacy and government relations, which all took center stage as Zoom became a widely-used service at large enterprises as well as in education, health care and among religious organizations. A branch of the U.S. Department of Justice was reviewing the deal out of concern about potential foreign participation, according to a letter dated Aug. 27 that was sent to the Federal Communications Commission. That's when Goldman Sachs started advising Zoom on a deal and Five9 hired Frank Quattrone's Qatalyst Partners. Eventually the deal fell apart when the stock price plunged, but Zooms desire to get into customer service one way or the other didnt diminish. The nine-year-old app's (Zoom) market crossed $140 billion in October 2020, surpassing Exxon Mobile, which was 130 years old. If your company uses Teams at work, you probably use Teams for video. But neither has anywhere near the name recognition as Zoom. However, not all forward-looking statements contain these identifying words. Zoom (ZM -0.28%) was arguably the biggest winner from the pandemic, becoming not only an indispensable tool for schools and businesses but also a household name. Please see our June 17, 2020 blog post for more information. Both companies are set up to be cloud consolidators as automation changes the future of work and the enterprise software stack of the future gets built, Chuang said. Sign up for free newsletters and get more CNBC delivered to your inbox. $76.14 Five9 isn't the only player in cloud-based business contact centers, so Zoom could still go shopping. By their nature, these statements are subject to numerous uncertainties and risks, including factors beyond our control, that could cause actual results, performance or achievement to differ materially and adversely from those anticipated or implied in the statements. explore acquisition. Zoom should use its cash to buy D2L, one of the leading providers of Learning Management Systems . I think this could actually be a better fit for Zoom than Five9 would have been. Sign up for free newsletters and get more CNBC delivered to your inbox. The company has built an easy-to-use video conferencing app that's attracted millions of users, and Zoom's revenue is up around 10x in the last three years as a result. Zoom's market share in the higher education system is quickly eroding from Microsoft and Google. A Division of NBCUniversal. "The acquisition is expected to help enhance Zoom's presence with enterprise customers and allow it to accelerate its long-term growth opportunity by adding the . Lyft's stock was up on acquisition rumors, and the company could be a good target mainly due to the fact that management has done a poor job of containing costs. CNBC's Ari Levy contributed to this report. We are proud to announce the acquisition of Keybase, another milestone in Zooms 90-day plan to further strengthen the security of our video communications platform. Dogpatch Advisors. 2022 CNBC LLC. ZoomInfo Acquisitions. After reporting second-quarter 2021 revenue of $1.02 billion, up 54% from a year ago, management expects revenue of $1.015 billion to $1.02 billion in the third quarter. The video conferencing company isn't part of a big suite offered by a big tech company that will be maintained long after the pandemic ends. It should be a great conversation with some of the best in . Mitel? This key will be distributed between clients, enveloped with the asymmetric keypairs and rotated when there are significant changes to the list of attendees. Lyft's stock is down over 66% over the past year, as exuberance stemming from the previous few years that led to excessive valuations has started to moderate, especially within tech sectors, leading to many stocks retreating significantly from their highs. Enter your email to receive notifications of new posts. Zoom's slowing growth is a sign that both workers are going back to the office and that big tech's assault on its business is starting to take hold. Zoom a Leader in 2022 Gartner Magic Quadrant for UCaaS, Worldwide, Zoom Contact Center unveils new features and adds availability in UK and Ireland, Zoom Expands Platform with New Innovations to Enhance Team Collaboration and Customer Experiences. Zoom Video reported revenues of $1.1 billion in the last reported quarter, representing a year-over-year change of +4.9%. In the three years since reaching a $100 billion market cap, Salesforce has completed four billion-dollar-plus deals, including Slack and the $15.7 billion purchase of Tableau. Zoom to Acquire Solvvy and Advance the Next Frontier of Customer Service May 12, 2022 4 min read We're excited to announce that we've entered into an agreement to acquire Solvvy, a leading conversational AI and automation platform for customer support. EPS of $1.07 for the same period compares with $1.11 a year ago. WATCH: Zooms acquisition of Five9 is a steal of a deal, says analyst. That's potentially a decline sequentially, which is terrible for a growth stock trading for 24 times sales. Today, the company announced plans to extend that by acquiring Solvvy, a nine-year-old startup that concentrates on conversational AI. Acquisition talks cooled for a while and picked up in the last three months, said people with knowledge of the transaction, who asked not to be named because the discussions were confidential. Regulators with concerns about foreign participation were reviewing the planned deal. Earlier this year, the company announced a new customer service solution, which would take advantage of existing Zoom capabilities. With Solvvy, the company gets more automation and intelligence and the ability to clear routine questions without having to speak to a person. Comparably. As enterprises began to figure out that working from home was going to continue, however, their business platforms began to include video more often. Zoom has acquired the Zoom-based broadcast tools created by the startup Liminal, along with two of the company's co-founders, the videoconferencing platform announced in a post on its blog. For three months in a row, deals have topped $500 billion. Factoring in the impact it expected from Five9, Zoom executives told analysts earlier this month that they were looking at a $91 billion total addressable market in 2025, up from $34 billion in 2019. Merck (NYSE: MRK) was seen as a buyer of the company but an . These end-to-end encrypted meetings will not support phone bridges, cloud recording, or non-Zoom conference room systems. To make the world smarter, happier, and richer. The video chat company's historic growth during the Covid-19 pandemic vaulted its market cap from $9.2 billion at the time of its 2019 IPO to a peak of $159 billion in October, putting it tentatively even with Cisco. Facebook, Microsoft, Zillow Search 4 results Statistics Edit View Timeline Export to CSV Transaction Name Acquiree Name Get this delivered to your inbox, and more info about our products and services. Microsoft's purchase of Nuance Communications for $19.7 billion, including debt, amounted to a 23% premium over Nuance's prior close. We believe this will provide equivalent or better security than existing consumer end-to-end encrypted messaging platforms, but with the video quality and scale that has made Zoom the choice of over 300 million daily meeting participants, including those at some of the worlds largest enterprises. Solvvys proprietary technology will broaden Zoom Contact Centers offering with scalable self-service and conversational AI. Got a confidential news tip? SAN JOSE, Calif. and KARLSRUHE, Germany, June 29, 2021 (GLOBE NEWSWIRE) -- Zoom Video Communications, Inc. (NASDAQ: ZM) today announced it has signed a definitive agreement to acquire Karlsruhe Information Technology Solutions - Kites GmbH ("Kites"), a start-up dedicated to developing real-time Machine Translation ("MT . Zoom assumes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, except as required by law. Zoom founder Eric Yuan poses in front of the Nasdaq building as the screen shows the logo of the video-conferencing software company Zoom after the opening bell ceremony on April 18, 2019 in New York City. A big reason why an agreement took so long to come together was because both stocks were so volatile, people familiar with the talks said. If Zoom were to acquire both companies, it could generate about 60% more revenue than. Encryption keys will be tightly controlled by the host, who will admit attendees. Travis Hoium has no position in any of the stocks mentioned. Soon Alphabet's (GOOG -0.94%) (GOOGL -0.94%) Google Meet, Microsoft's (MSFT -0.80%) Teams, and Facebook (META 0.49%) Workrooms tried to wedge their way into the action. This acquisition marks a key step for Zoom as we attempt to accomplish the creation of a truly private video communications platform that can scale to hundreds of millions of participants, while also having the flexibility to support Zoom's wide variety of uses. Zoom has a long way to go before it can claim to have a portfolio of cloud software products, like Salesforce, Adobe and ServiceNow. Despite dominating social media, Facebook has struggled to enter the enterprise market in a meaningful way. Zoom was looking to Five9 to reduce its dependence on the video and audio meetings that have become so popular within businesses and other organizations. Learn More. Join Us December 13-15, 2022. Today, audio and video content flowing between Zoom clients (e.g., Zoom Rooms, laptop computers, and smartphones running the Zoom app) is encrypted at each sending client device. Five9 shareholders rejected Zoom's agreement to buy the cloud contact center software maker for what had been a $14.7 billion all-stock offer. Another enterprise giant that may see value in Zoom is Salesforce. Here's why I think selling would be the best option for Zoom long-term, plus three potential buyers who could use Zoom in their portfolios. Mergers and acquisitions have roared back this year, with potential takeover targets everywhere. 4 Social Security Changes Joe Biden Wants to Make: Is 2023 the Year They Become Reality? "Not everything has worked out," Chuang said, but he argues it's important to take take big swings, even if the business is currently in good shape. Top Salesforce execs say it doesn't have a 'real appetite' for more huge acquisitions any time soon, and deny that it competed with Zoom on a key $15 billion deal. Zoom's agreement to buy cloud contact center software company Five9 was scuttled on Thursday, after Five9 shareholders rejected the deal. We want to hear from you. They never overlapped at Cisco Yuan left to start Zoom a year before Trollope joined but the connection is key as they both saw the challenges of retrofitting a legacy technology company for the cloud era. Late last year, the company entered the live events space with the launch of a homegrown product called OnZoom, expanding the video platform beyond the workplace and betting that online gatherings, in some form, are here to stay. This is a great move and acquisition. Zoom is actually already integrated into the larger Salesforce platform as well, so bringing the product in-house could bring added benefits. That's why selling to a larger company may be a smart move before everyone else adds the same functionality Zoom has. As hard as they tried, Zoom remained the dominant name in mid-2020. These assumptions, uncertainties and risks include that, among others, the possibility that the anticipated benefits of the transaction are not realized when expected or at all, division of managements attention from ongoing business operations and opportunities, potential adverse reactions or changes to business or employee relationships, the ability to integrate Keybase successfully, and other factors that may affect future results of Zoom. Zoom Rooms and Zoom Phone participants will be able to attend if explicitly allowed by the host. All Rights Reserved. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Get this delivered to your inbox, and more info about our products and services. Free-to-use and low-cost Zoom accounts have been lifesavers during the pandemic, and those small businesses may be a growth engine for technology companies long-term. Zoom Rooms and Zoom Phone participants will be able to attend if explicitly allowed by the host. To that end, we will be taking the following steps: We are committed to remaining transparent and open as we build our end-to-end encryption offering. "I can't imagine this will be last one.". Shares of Zoom and Five9 moved 10% or more in a single week on several occasions this year, making it difficult to come to terms. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. And that's exactly why I think it's a perfect buyout target now that the stock has come off its highs. In other words, the stock market is giving Zoom the tools to become a major dealmaker. Five9 shares fell 2% in extended trading following the statement from the companies. Zoom Video Communications, Inc. All rights reserved. However, the encryption keys for each meeting are generated by Zooms servers. Zoom is looking to expand its product offerings, and combining with Avaya would be one way to do so. Zoom soared past $100 billion in market cap without ever doing a significant acquisition or finding a second meaningful source of revenue. Zoom's stock has fallen sharply off its all-time high. Zoom dives deeper into intelligent customer service with Solvvy acquisition. We plan to publish a detailed draft cryptographic design on Friday, May 22. "It allows them to use their currency to buy things that are impactful," said Alfred Chuang, a partner at venture firm Race Capital and the co-founder of BEA Systems, which Oracle bought for $8.5 billion. clear filters. The cloud-based videoconferencing company Zoom had a blockbuster 2020, with pandemic-driven remote work driving extraordinary growth. But Zoom said last week, when news of the review was reported, that it still expected the deal to close in the first half of 2022. Global M&A has hit a record $2.4 trillion, up 158% over 2020, according to a Refinitiv Deals Intelligence reportthe highest since the company began collecting data in 1980. At the agreed-upon price, they were only going to receive a 13% bump in the value of their shares over where they were trading prior to the agreement. Price as of December 9, 2022, 4:00 p.m. Mitel is one of those rumored to be going after Avaya. Eric and Rowan are very good friends.". Youre reading a free article with opinions that may differ from The Motley Fools Premium Investing Services. Five9 shareholders were ultimately unsatisfied with the small premium that Zoom was set to pay. The company's planned $14.7 billion purchase of Five9 is the first indication that it's willing to use its inflated market cap on big deals. According to Deadline, Warner Bros. Salesforce needed 14 years as a public company to reach a market cap of $100 billion. Zoom could invest in building the product itself, but customers "do not want to wait," Yuan said. Once we have assessed this feedback for integration into a final design, we will announce our engineering milestones and goals for deploying to Zoom users. When technology companies see a successful product, they often copy it as quickly as they can. Zoom's initial talks with Five9 date back to last year, according to people familiar with the matter. The merger between Zoom Video Communications ( ZM -1.31%) and Five9 ( FIVN 2.16%). Getting there required three multibillion-dollar acquisitions and four distinct revenue sources. By entering your email, you agree to our Privacy policy. 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