The Microsoft campus in Redmond, Washington (GeekWire Photo / Todd Bishop)
The news: Microsoft is in “advanced talks” to acquire Nuance Communications for $ 16 billion, according to a Bloomberg report on Sunday.
Nuance background: The publicly traded Boston-area company specializes in “conversational AI” for applications in healthcare, telecommunications, automotive, financial services and more. Nuance posted revenue of $ 345.8 million for the quarter ended December 31, a decrease of 4%, and non-GAAP net income of $ 91.4 million, up slightly from last year. The company’s shares have nearly tripled since March 2020, and its market capitalization is $ 13 billion.
Previous connections: Microsoft has partnered with Nuance in the past to forge healthcare deals. Nuance also has a strong presence in the Seattle area near Microsoft headquarters due to several acquisitions including VoiceBox, Swype, Tweedle, Varolii, and Jott. Nuance acquired Saykara, a Seattle-based health tech startup that makes a voice assistant for clinicians, in February.
A big thing: At the price quoted, the acquisition would be Microsoft’s second largest after purchasing LinkedIn for $ 26.2 billion. It reflects the company’s continued investments in artificial intelligence, language technology and healthcare. According to Dan Ives, an analyst at Wedbush, Microsoft is on the “M&A warpath for the next 12 to 18 months,” citing recent reports on Microsoft’s interest in buying Discord and acquiring $ 7 worth of ZeniMax, $ 5 billion.
We asked Microsoft for a comment and will update it when we hear something.