Microsoft (MSFT) is one of the largest technology companies in the world. Paul Allen and Bill Gates founded this company in 1975 in a garage in Albuquerque, New Mexico. After five years Allen and Gates were hired to provide the OS for first personal computer of IBM. After that in 1985 the Microsoft launched its Windows software product.
Then in 1986, Microsoft raised $61 million in its first Initial Public Offering (IPO) which some analyst referred to as ‘deal of the year’.
In late 1980s, the company became the world’s largest personal computer software company.
In 10 years after the IPO, the company’s stock rose more than a hundredfold making it the world’s largest company by market value.
As of April, 2022 the market capitalization of Microsoft rose to $2.09 trillion and the company posted $61.3 as the net income with revenue of $168 billion for 2021 financial year.
It is true that Microsoft started as a software company but slowly it has expanded its roots in the broad areas of the technology industry. Now, with software’s, Microsoft also sells artificial intelligence (AI), cloud-computing infrastructure and services, personal computing devices and much more.
Most of the expansion in the company came from the large and small acquisitions making tens of billions of dollars in value.
In all the acquisitions, there are six major acquisitions of Microsoft which are mentioned as below.
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LinkedIn
Founded in 2002, the business centric website is focused on helping people grow their professional network. The company became profitable within five years of its launch. From year 2007 to 2011, the company went public and grew from 15 million members to 100 million members. After that it was acquired by Microsoft in 2016 and in the same year, the members grew to more than 500 million from 200 countries.
With this acquisition Microsoft has taken a fairly hands-off approach which allows LinkedIn to maintain its core culture and brand. LinkedIn mainly offers a recruiting tools and valuable social media platformwhich earns revenue via premiummembership.However, it also produces commercial cloud revenue for Microsoft via the LinkedIn’s commercial business.
Type of business – Professional social network site
Acquisition price – $27.0 Billion
Acquisition date – Dec 8, 2016
Annual revenue – $10.3 Billion (FY 2021)
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Skype technologies S.A.R.L
Founded by Janus Friis of Denmark and Niklas Zennstrom of Sweden in 2003, the company is currently headquartered in Luxembourg. The company became an early success story in the field of VoIP i.e., Voice over Internet Protocol which is a communication technology that permits users to interact each other by audio using the internet connection instead of the analog connection. From year 2004 to 2012 Skype’s registered users soared from 1 million to more than 250 million each month.
Type of business – Telecommunications application
Acquisition price – $8.5 Billion
Acquisition date – May 10, 2011
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GitHub
The company was founded by Chris Wanstrath in 2007 when the first ‘commit’ (a term used to describe the action for storing a file’s content and hierarchy in digital repository). After that the company became popular for open-source coding repository and development tool for large companies and software developers.
By this time, the Microsoft has acquired GitHub in 2018 and the company had reached 30 million developers and was also hosting more than 100 million repositories. This acquisition demonstrates the Microsoft’s focus on the open-source development and also aims to accelerate developer use of this platform and provisioning for other tools and services for the audience.
Type of business–Software development platform
Acquisition price – $7.5 Billion
Acquisition date – Oct 25, 2018
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Mojang
It is a Sweden based video game company popularly known for producing the popular game Minecraft. It was founded by Markus ‘Notch’ Persson in2009. As of May 2020, the company manages to sell more than 200 million copies of the game, which also made the best-selling games till the time. Microsoft bought this company in 2014. Nowadays the game of Mojang isplayed on PlayStation, iOS, Xbox platforms, Windows and much more. Microsoft has also put the game studio to various users which include educational and designing version of Minecraft for classroom.
Type of business–Video game studio
Acquisition price – $2.5 Billion
Acquisition date – Sept 15, 2014
Also read: What are Facebook subsidiaries?
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aQuantive
aQuantive was founded in 1997 and consist of family of brands which is focused on offering digital marketing service and includes media buying/planning, consultation services, advertising toolsets and much more. the company was acquired by Microsoft in 2007, where it made an attempt to compete with Google in the online advertising market. However, the deal was a big failure. Microsoft in 2012 wrote down the value of the advertisement business by $6.2 billion stating that it drastically overpaid for the company. Still Microsoft operates ad business but now it is mainly focused on the search advertising instead of display advertising.
Type of business – Online advertising platform
Acquisition price – $6.3 Billion
Acquisition date – Aug 13, 2007
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ZeniMax Media
The video game publisher company was founded in 1999 and it creates and published original interactive entertainment content for mobile devices, personal computers, consoles and much more. The company is the parent company of Bethesda Softworks and was founded in 1986. It has also built a powerful reputation by releasing award-winning video games. Late in Sept 2020, Microsoft announces its acquisition for $7.5 million.
Type of business – Video game publisher
Acquisition price – $7.5 billion
Acquisition date – March 9, 2021
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Nuance communication
The company was founded in 2992 as the Visioner Inc and late in 2005 it changed its name to Nuance communication. The company became leading provider of the cloud-based clinical intelligence for health care providers and conventional AI. It also offers clinical speech recognition software for building Azure i.e., the platform on Microsoft cloud. In 2021 Microsoft acquired the company for $19.7 Billion.
Type of business–Conversational AI solutions
Acquisition price – $19.7 billion
Acquisition date – March 4, 2022
Annual revenue – $1.36 Billion (FY 2021)
Annual net loss – $26.7 Million (FY 2021).
