Microsoft agrees to acquire speech tech company Nuance for $19.7 billion in cash

Shawn Knight

Posts: 13,177   +132
Staff member
Editor's take: Microsoft may have struck out with Cortana but is getting a mulligan with Nuance. Redmond is only talking healthcare applications right now but we wouldn't be surprised to see Nuance tech show up in other Microsoft-owned products like Teams down the road.

Microsoft has agreed to purchase speech recognition and artificial intelligence specialist Nuance in a bid to strengthen its cloud and AI-based healthcare business.

Microsoft said the all-cash deal is valued at $19.7 billion, or $56 per share – representing a 23 percent premium over Nuance’s most recent closing price. Once complete, it’ll be Microsoft’s second-largest acquisition ever, after the $26.2 billion it paid for LinkedIn in 2016.

Nuance has been a leader in the field of voice recognition for years, leading to widespread adoption in healthcare. According to Microsoft’s press release, Nuance products are used for clinical documentation by 55 percent of physicians and 75 of radiologists in the US.

Commercially, however, Nuance is arguably best known for its Dragon speech recognition software. What you may not know is that Apple’s Siri voice assistant was also rooted in tech provided by Nuance.

Microsoft said it expects the transaction to close during the current calendar year, pending regulatory approval and other customary closing conditions. Nuance CEO Mark Benjamin will stay with the company in his current role and report to Scott Guthrie, who is the executive vice president of Microsoft’s cloud and AI business. Financials from the division will be reported under Microsoft's Intelligent Cloud segment, we're told.

Images courtesy The Art of Pics, rafapress

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VitalyT

Posts: 5,570   +5,274
That's insane. How can a company with atrocious product support and buggy software be worth $19.7 billion? (That's me as a customer talking).

MS is overpaying 100 times for the company. Seems like some money laundering.
 
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DZillaXx

Posts: 268   +391
They are probably overpaying for something that in the long run may not be as worthwhile as other ventures. But MS has a pretty good track record of keeping its business diversified. Something the likes of companies like Apple really needs to figure out.

MS is paying for the already established medical market with Nuance's Dragon Medical One platform.

Nuance's yearly net income is not what I'd call a great deal for how much MS is paying for the company. MS would have done better by buying something like Spotify.
 

fl21289

Posts: 242   +290
Working in IT at a hospital field. This is what physicians use to Dictate... Hate the power mics. As someone mentioned. It's very buggy no matter what firmware you put. Also good luck getting support from India who can barely hear you and you understand them.
 

duckofdeath

Posts: 375   +480
They are probably overpaying for something that in the long run may not be as worthwhile as other ventures. But MS has a pretty good track record of keeping its business diversified. Something the likes of companies like Apple really needs to figure out.

MS is paying for the already established medical market with Nuance's Dragon Medical One platform.

Nuance's yearly net income is not what I'd call a great deal for how much MS is paying for the company. MS would have done better by buying something like Spotify.
Net income has nothing to do with value. Tesla's total net income is probably minus a bazillion dollars. That doesn't mean I'd get a bazillion dollars from Elon for taking over that company.
 

Homerlovesbeer

Posts: 143   +147
They are paying in cash eh? So how many truck loads will that be? Will there be a bank vault big enough to store the cash?

You do know paying "in cash" literally means paying with physical bank notes?

Lol