Microsoft is in a billion-dollar shopping spree.
The company recently agreed to pay $ 19.7 billion for Nuance Communications, which provides artificial intelligence support to healthcare practitioners, in a deal that came not long after the acquisition of video game publisher Zenimax Media last year. last.
Meanwhile, Microsoft is said to be in exclusive talks to acquire the Discord group online chat platform for up to $ 10 billion, previously bidding for US operations of the TikTok viral video application, and has been in unfortunate talks with Pinterest. for what it would have was a billion-dollar deal.
The company has the money to spend, ending its fiscal year 2020 with $ 136 billion in cash on hand, after the pandemic forced the move to remote work and led to a boom in Microsoft cloud software and productivity. Experts say that thanks to its nearly $ 2 trillion growing market capacity – and its leading rivals slowed by regulatory scrutiny – we can expect to see Microsoft open its portfolio to large and small companies for the rest of the year and beyond. .
“Microsoft is on the M&A war in the next 12 to 18 months, and Nuance could be the first step in an increased appetite for transactions in 2021,” Wedbush Securities analyst Dan Ives said in a note to clients.
Insider asked nine industry analysts which companies could be next on Microsoft’s shopping list, as it appears to be consolidating its existing business and joining us through the acquisition.
Some analysts say Microsoft could use M&A to strengthen its cloud division, where it is considered the number two player behind market leader Amazon Web Services in cloud computing. This is especially important as Google makes progress and IBM and Oracle eliminate their own niches in the marketplace.
It could also continue on the path set by the Nuance agreement and buy more AI startups, increasing its presence in a key technology sector. Other experts have suggested that Microsoft look at startups in places as diverse as geothermal energy or the elimination of “rogue drones.” Some have suggested that Microsoft could spend more than it has done so far on well-known names such as Twilio, Okta or even Twitter.
Here are 22 companies that analysts said would make sense for Microsoft to buy. (All ratings of the private company were taken from the Pitchbook, unless otherwise stated, while the data on public companies is correct as of Friday afternoon.)