Wiz’s rejection of Google’s acquisition offer could have significant repercussions for Microsoft, according to analysts.
Google’s attempt to acquire Israeli cybersecurity startup Wiz for $23 billion has been called off, leading to potential shifts in the tech landscape, particularly affecting Microsoft. Wiz CEO Assaf Rappaport disclosed that the company decided against the acquisition to prioritize its goal of generating $1 billion in annual revenue and preparing for an initial public offering.
This deal was expected to enhance Google’s cybersecurity capabilities during a time of increased scrutiny following a major outage from cybersecurity provider CrowdStrike, which occurred last week. Analyst Dan Ives from Wedbush noted that investor apprehensions and antitrust issues contributed to the deal’s failure, given Google’s ongoing battle with regulatory scrutiny, including a recent trial linked to the Department of Justice.
Ives indicated that the failure of the Wiz acquisition could have cascading effects throughout the tech sector. He suggested that Google is likely to continue investing in expanding its cybersecurity offerings, a path Microsoft may also pursue. He anticipates that Microsoft will seek consolidation within the cybersecurity space over the next 12 to 18 months to strengthen its platform.
Meanwhile, Microsoft faced challenges recently due to a global IT outage linked to a problematic update in its cybersecurity software supplied by CrowdStrike. This incident led to widespread disruptions for users, raising concerns about Microsoft’s cybersecurity measures. While Ives maintains that CrowdStrike remains a leader in cybersecurity, the outage underscores the need for Microsoft to bolster its capabilities, creating further opportunities following the collapse of Google’s Wiz deal.