Cisco makes 2 big acquisitions to take on Zoom

Zoom has been eating Webex's lunch. Now Cisco is fighting back.

| More on:
Person engaged in a zoom meeting on laptop computer

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Cisco Systems Inc (NASDAQ: CSCO) announced on Monday that it is making two acquisitions to help improve the functionality of its WebEx videoconferencing, collaboration, and customer service platform. The networking giant is paying an undisclosed sum to acquire audience interaction platform Slido. The technology company provides tools that help moderate large groups, and "enables real-time feedback and insight before, during and after any meeting." Slido has features that allow viewers and meeting participants to ask questions, answer polls, and participate in quizzes, among others. The Motley Fool regularly uses Slido for its events. 

Slido boasts over 7 million participants each month and will continue to be available for use by competitors. "Cisco understands the value in continuing Slido as a stand-alone product and building great integrations with other virtual meeting and presentation platforms like [Microsoft (NASDAQ: MSFT)] Teams, Zoom (NASDAQ: ZM) and [Alphabet's (NASDAQ: GOOGL) (NASDAQ: GOOG)] Google Meet," said Juraj Pal, Slido's product head. 

The tech giant also revealed plans to acquire IMImobile, a cloud communications software and services company, for roughly $730 million. IMImobile allows organizations to communicate with their customers across various channels, including social media, messaging, and voice. The company will become part of WebEx to further Cisco's contact center-as-a-service (CCaaS) platform. The company will use the platform's omnichannel capability to allow businesses to better connect with their customers.

Zoom has become the de facto industry standard for video conferencing since the rise of the pandemic earlier this year. In the third quarter, its revenue grew 367% year over year. At the same time, the number of customers contributing $100,000 or more in trailing-12-month revenue grew 136%, while the number of customers with more than 10 employees grew 485%. This marked the third consecutive quarter of triple-digit revenue growth for Zoom, eating into Cisco's market opportunity.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Danny Vena owns shares of Alphabet (A shares), Microsoft, and Zoom Video Communications. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Microsoft, and Zoom Video Communications. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), and Zoom Video Communications. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on International Stock News

A male party goer sits wearing a party hat and with a party blower in his mouth amid a bunch of balloons with a sad, serious look on his face as though the party is over or a celebration has fallen flat.
International Stock News

What snapped the S&P 500 winning streak last night?

The S&P 500 almost made October a winner, but fell at the final hurdle.

Read more »

Man going down a red arrow, symbolising a sliding share price.
International Stock News

Why Nvidia stock is sinking today

Investors were spooked by economic data and the ambitions of a deep-pocketed rival.

Read more »

Rede arrow on a stock market chart going down.
International Stock News

Why Microsoft stock is sinking today

Microsoft just beat quarterly earnings estimates. So why is the stock falling?

Read more »

US economy and sharemarket with piggy bank
Share Market News

Here's why Goldman Sachs sees a decade of lower returns ahead for US shares

Aussie investors have placed a lot of faith in US shares this year.

Read more »

ETF written in gold with dollar signs on coin.
ETFs

Here's why the iShares S&P 500 ETF (IVV) flew 6% higher in October

Investors are very keen on US shares at the moment.

Read more »

Man pumping petrol
International Stock News

Where will Tesla shares be in 10 years?

This historically booming stock might not live up to the hype.

Read more »

A woman sits at her computer with her hand to her mouth and a contemplative smile on her face as she reads about the performance of Allkem shares on her computer
International Stock News

46% of Nvidia's revenue came from 4 mystery customers last quarter

Nvidia's incredible growth is increasingly reliant on just a handful of customers.

Read more »

A young girl looks up and balances a pencil on her nose, while thinking about a decision she has to make.
International Stock News

Should you buy Nvidia stock before November 20?

History could repeat itself with Nvidia's upcoming quarterly update.

Read more »