Main

Microsoft to Acquire Nuance for $19.7 Billion

Microsoft has announced today that the company will acquire Nuance for about $19.7 billion. Once completed, this will be Microsoft’s second-largest acquisition following Linked In for $26.2 billion back in 2017.

Nuance is known for its voice technologies and solutions in the healthcare space. Microsoft is paying a premium for Nuance but the reasoning for the acquisition is likely a bit more technical than simply acquiring the book of business. The company does note that in the announcement that they expect Nuance’s technology to contribute to the company’s recently launched Microsoft Cloud for Healthcare.

The voice technologies that Nuance has created and more specifically, the patent portfolio it has amassed, could be one of the bigger drivers of the acquisition than any specific line of business. Microsoft has created its own voice technologies during the past decade and adding Nuance to the portfolio will boost its presence in the healthcare and customer engagement segments but owning the portfolio of patents will also help protect its voice technologies going forward.

Nuance is a public company and in calendar year Q4, the company posted revenue of $345.8 million with a net income of $7 million. With these results, Nuance’s financials will not significantly impact Microsoft’s results on a quarterly basis as the company posted results of $43.1 billion in revenue and a net income of $15.5 billion last quarter.

Sponsored Content

Passwords Haven’t Disappeared Yet

123456. Qwerty. Iloveyou. No, these are not exercises for people who are brand new to typing. Shockingly, they are among the most common passwords that end users choose in 2021. Research has found that the average business user must manually type out, or copy/paste, the credentials to 154 websites per month. We repeatedly got one question that surprised us: “Why would I ever trust a third party with control of my network?

Considering the size of this acquisition and that both companies are public, it will take some time for this transaction to close. Microsoft expects the transaction to be complete by the end of the year and the company is making this an all-cash transaction too.

Upon closing, Microsoft expects Nuance’s financials to be reported as part of Microsoft’s Intelligent Cloud segment. Microsoft expects the acquisition to be minimally dilutive (less than 1 percent) in the fiscal year 2022 and to be accretive in the fiscal year 2023 to non-GAAP earnings per share, based on the expected close timeframe.

Related Topics:

BECOME A PETRI MEMBER:

Don't have a login but want to join the conversation? Sign up for a Petri Account

Register
Comments (0)

Leave a Reply

Brad Sams has more than a decade of writing and publishing experience under his belt including helping to establish new and seasoned publications From breaking news about upcoming Microsoft products to telling the story of how a billion dollar brand was birthed in his book, Beneath a Surface, Brad is a well-rounded journalist who has established himself as a trusted name in the industry.
Don't leave your business open to attack! Come learn how to protect your AD in this FREE masterclass!REGISTER NOW - Thursday, December 2, 2021 @ 1 pm ET

Active Directory (AD) is leveraged by over 90% of enterprises worldwide as the authentication and authorization hub of their IT infrastructure—but its inherent complexity leaves it prone to misconfigurations that can allow attackers to slip into your network and wreak havoc. 

Join this session with Microsoft MVP and MCT Sander Berkouwer, who will explore:

  • Whether you should upgrade your domain controllers to Windows Server
    2019 and beyond
  • Achieving mission impossible: updating DCs within 48 hours
  • How to disable legacy protocols and outdated compatibility options in
    Active Directory

Sponsored by: