Alphabet, the parent company of Google, has walked away from the discussion on acquiring Hubspot. According to reports, for the last three months Google was keen to acquire Hubspot (the CRM giant). This could have been a multi-billion dollar deal that would have benefitted Google Cloud. The discussion did not progress due to the Parties not getting to the due-diligence stage in deal talks, and fell apart shortly after the companies held initial discussions on a potential deal.
In May, there is proof that talks are ongoing, and in July, there is no chance of this happening. In the meantime, HubSpot users were either ignoring it all or wondering what it would mean for a key component of their marketing stack.
For the ninth consecutive quarter, HubSpot’s revenue and earnings exceeded forecasts despite growing rumors of a sale to Alphabet, Google’s parent company. Despite suffering a $176 million operating loss last year, HubSpot generated over $2 billion in revenue.
For the first quarter of 2024, the Cambridge, Massachusetts-based company recorded earnings per share of $1.68 and revenue of $617.4 million. Revenue has increased by 23%, and earnings have increased by 40% since last year. On $598 million in sales, analysts had predicted that HubSpot would make $1.50 in profit.
With a 32% increase in share price over the last 12 months, HubSpot is now valued at $30 billion.
In 2023, Google Cloud registered a profit for the first time. In the first quarter of 2024, the cloud giant headquartered in California brought in $9.6 billion in sales, a 28% increase year over year, and earned $900 million in operating income.
Even though Alphabet would have officially acquired HubSpot, Google Cloud might have benefited from the acquisition. If Google Cloud had a company, it could have taken on CRM industry giants like Microsoft, Oracle, and Salesforce. HubSpot develops software to assist businesses in reaching out to potential clients and automating their marketing processes.
Additionally, there would have been net new sales opportunities thanks to HubSpot’s Service Hub, which assists customer service departments in managing their daily workload. Marketers create advertising campaigns, disseminate promotional content, and perform other marketing tasks using its cloud-based Marketing Hub software.
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