Zoom Cloud Meetings announced on Sunday that it’s buying Five9, a provider of cloud contact center software, in an all-stock transaction valuing the company at $14.7 billion.The deal marks Zoom’s first billion-dollar acquisition and comes as the company prepares for a post-pandemic world with employees returning to the office.
It is the second-biggest U.S. tech deal this year, behind Microsoft’s planned $16 billion purchase of Nuance Communications. Zoom CEO Eric Yua said that we are continuously looking for ways to enhance our platform, and the addition of Five9 is a natural fit that will deliver even more happiness and value to our customers.
After expanding revenue by 326% in 2020, Zoom Cloud Meetings faces a natural slowdown, especially as companies reopen and face-to-face meetings resume. While the company has launched new products to reckon with coming changes to its business, it’s now so big that organic growth alone is unlikely to satisfy Wall Street. It also needs new revenue sources as Microsoft ramps up competition in video chat with Teams. Zoom’s stock price jumped almost 400% last year, though it’s dropped 36% since reaching its peak in October.