Cisco acquires cybersecurity firm Splunk for a jaw-dropping $28 billion

Cisco today announced it is acquiring cybersecurity and observability leader Splunk in a cash deal worth $28 billion. 

The San Jose, California-based networking giant said the move will bring together both companies’ capabilities to drive the next generation of AI-enabled security and observability and make organizations of all sizes more secure and digitally resilient in today’s data-driven, hyperconnected world. 

“From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient,” Chuck Robbins, the chairman and CEO of Cisco, said in a statement.

The deal, which values each Splunk share at $157, is expected to close by the end of the third quarter of 2024. It is subject to regulatory approvals and other customary closing conditions. Upon close, Splunk’s president and CEO Gary Steele will join Cisco’s executive leadership team reporting to Robbins.

Strengthening cybersecurity and observability play

Cisco has already established a significant presence in cybersecurity.

The company offers a wide range of products and services to protect networks, data and applications from cyber threats, including firewalls, intrusion prevention systems (IPS), VPNs and endpoint security solutions.

Now, as the threat landscape continues to expand and the data ecosystem becomes more complex with the advent of generative AI and other evolving technologies, the company is teaming up with Splunk to bolster its cybersecurity play.

With this acquisition, Splunk’s security capabilities will complement Cisco’s existing portfolio of solutions, providing enterprises with strengthened security analytics and coverage from devices to applications to clouds.

Splunk was founded in 2003 by Erik Swan, Michael Baum and Rob Das with a mission to make big data searchable. Over the years, the platform evolved into a full-fledged tool for searching, monitoring, analyzing and visualizing machine-generated data in real-time, covering data points from websites, applications, sensors, devices and everything else that makes up the IT Infrastructure. This drove its application across multiple segments, including IT operations, business intelligence and cybersecurity (threat detection and management). 

Cisco notes that the companies’ combined capabilities will also provide observability across hybrid and multi-cloud environments, enabling enterprises to deliver smooth application experiences that power their digital businesses. This will also help enterprises with their AI efforts and allow for greater investments in new solutions, the company added.

“Together, we will form a global security and observability leader that harnesses the power of data and AI to deliver excellent customer outcomes and transform the industry. We’re thrilled to join forces with a long-time and trusted partner that shares our passion for innovation and world-class customer experience, and we expect our community of Splunk employees will benefit from even greater opportunities as we bring together two respected and purpose-driven organizations,” Steele said in the same statement.

Not the only acquisition in cybersecurity

While the deal stands out due to its massive size, it comes as another notable move from Cisco in the security and observability space.

Earlier this year, the company also acquired cloud security software company Lightspin Technologies; Smartlook, a digital experience and analytics solution that monitors user engagement on websites and mobile applications in real-time; and Armorblox, a company focused on the use of large language models (LLMs) and natural language understanding in cybersecurity.

For fiscal year 2023, the company’s total revenue guidance stands at $57 billion with a year-over-year increase of 11%.