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Cisco CEO Chuck Robbins on Splunk acquisition: Deal will add $4 billion in annual recurring revenue

Cisco is acquiring cybersecurity software company Splunk for $157 per share in a cash deal worth about $28 billion, the company said Thursday, in its largest acquisition ever.

Splunk shares rose 21% in Thursday morning trading, while Cisco shares slipped 3.3%.

“From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient,” Cisco chair and CEO Chuck Robbins said in a statement. The deal, which is expected to close in the third quarter of 2024, continues a months-long buying spree to build out Cisco’s cybersecurity offerings.

Cisco expects the deal to be cash flow positive and gross margin accretive in the first year following the closing of the acquisition; it will be accretive to Cisco’s non-GAAP earnings per share by the second year.

Robbins expected organizational synergies to become clear and impactful within 12 to 18 months, he said Thursday in an appearance on CNBC’s Squawk on the Street. The company will finance the deal with a combination of cash and debt, he said.

“Together, we will become one of the largest software companies globally,” Robbins said in a conference call with analysts.

Splunk logo displayed on a phone screen and a laptop keyboard are seen in this illustration photo taken in Krakow, Poland on October 30, 2021. (Photo by Jakub Porzycki/NurPhoto via Getty Images)

Jakub Porzycki | Nurphoto | Getty Images

Analysts had mixed responses to the deal, raising concerns about potential product overlap, regulatory scrutiny and the price Cisco paid for a company that had, from the perspective of one analyst, presented an “underwhelming” pivot to cloud.

In recent years, Splunk turned away from an on-premise “customer-managed” approach to focus on a cloud-oriented offering.

Robbins and Splunk CEO Gary Steele pushed back on those concerns. “We still have many large customers who are very dependent upon the capabilities that we allow for in a customer managed environment,” Steele told analysts.

Robbins added that the companies did not anticipate needing to obtain regulatory approval for Splunk’s China business.

Splunk is a cybersecurity company that helps enterprises monitor and analyze their data to minimize the risk of hacks and resolve technical issues faster. Cisco makes and sells telecommunications and networking equipment, as well as a complementary suite of software.

Splunk CEO Steele had been with the company for a little more than a year. Prior to Splunk, Steele was CEO at Proofpoint, a cybersecurity firm. Proofpoint was acquired by Thoma Bravo in a $12.3 billion deal in 2021.

Steele will join Cisco’s executive leadership team after the deal close, Cisco said.

If Cisco backs out of the deal or is forced to do so because of regulatory intervention, it will pay Splunk a termination fee of $1.48 billion, according to a regulatory filing. If Splunk backs out of the deal for any reason, it will pay a $1 billion breakup fee to Cisco.

In 2023 alone, Cisco has acquired four companies: Armorblox, a threat detection platform, Oort, which does identity management, and Valtix and Lightspin, both cloud security companies. Cisco’s largest acquisition prior to the Splunk deal was the purchase of Scientific Atlanta for nearly $7 billion.

Tidal Partners, Simpson Thacher, and Cravath, Swaine & Moore advised Cisco. Qatalyst Partners, Morgan Stanley, and Skadden, Arps, Slate, Meagher & Flom advised Splunk.

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Amazon to close all of its Fresh grocery stores in UK

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Amazon to close all of its Fresh grocery stores in UK

People walk past an Amazon Fresh store in Washington, DC, on August 26, 2021.

Nicholas Kamm | AFP | Getty Images

Amazon plans to close all of its Fresh supermarkets in the U.K., in the latest recalibration of its grocery strategy.

The company said in a Tuesday blog that it’s preparing to close all 19 of its Fresh U.K. stores, “following a thorough evaluation of business operations and the very substantial growth opportunities in online delivery.” Five of the Fresh locations are expected to be converted into Whole Foods stores, Amazon said.

Amazon opened its first Fresh location outside the U.S. in London in 2021, about a year after it debuted the store concept in the Woodland Hills neighborhood of Los Angeles. Fresh stores offer cheaper prices and more mass-market items compared to Whole Foods, the upscale supermarket chain Amazon acquired for $13.7 billion in 2017. Many of the stores also feature Amazon’s cashierless “Just Walk Out” technology.

The Fresh store pullback in the U.K. comes as Amazon has continued to adjust its grocery ambitions. The company has slowed expansion of its Fresh grocery chain and Go cashierless stores in the U.S. It still maintains 500 Whole Foods locations and has opened mini “daily shop” Whole Foods stores in New York City.

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At the same time, Amazon CEO Andy Jassy and other company executives have touted the success of sales of “everyday essentials” within its online grocery business, which refers to items like canned goods, paper towels, dish soap and snacks.

Jassy told investors at the company’s annual shareholder meeting in May that he remains “bullish” on grocery, calling it a “significant business” for Amazon.

The company on Tuesday also said that it plans to offer same-day delivery of groceries, including perishable items, in the U.K. beginning next year.

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Chinese EV giant BYD says it has a backup plan if it’s cut off from Nvidia chips

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Chinese EV giant BYD says it has a backup plan if it's cut off from Nvidia chips

The Chinese electric car manufacturer BYD presents its models at the Open Space Area during the IAA Mobility in Munich, Bavaria, Germany, on September 12, 2025.

Eyeswideopen | Getty Images News | Getty Images

BYD has a backup plan if it gets cut off from the Nvidia chips it currently uses in its cars, a top executive at the Chinese electric carmaker told CNBC on Tuesday.

Stella Li, executive vice president at BYD, said the company had not received any directive from the Chinese government to stop using Nvidia chips — but if it did, it has a plan B.

“Everybody has a backup. BYD has [a] backup,” Li told CNBC’s Dan Murphy.

Li declined to expand on what the plan is, but she pointed to the Covid-19 pandemic during which there was a global shortage of semiconductors which badly affected the auto sector. BYD had “no issue” at the time because it developed a lot of its technology in-house, he said, so it was able to source alternatives quickly.

BYD's EVP Stella Li says the EV Maker is committed to Nvidia

Indeed, BYD has sought to have control over large parts of its supply chain, from manufacturing its own cars to developing its own batteries.

“We have a lot of strong … even deeper technology in-house, so we always have backup,” Li said.

Nvidia, whose chips underpin much of the world’s artificial intelligence development, has been caught in the crossfire amid U.S.-China tensions. The company’s H20 AI chip — designed specifically to comply with U.S. export restrictions to China — was first banned, then permitted to be sold in China this year after a revenue-share deal between Washington and Nvidia.

Now, China has reportedly been discouraging local tech firms from buying Nvidia’s AI chips.

Nvidia designs an entirely different set of semiconductors for cars, however.

One of Nvidia’s systems, Nvidia Drive AGX Orin, is designed to enable cars to carry out some driving tasks autonomously. BYD is a customer of this product.

There is no indication so far that the Chinese government is looking to ban this Nvidia system.

Li said BYD had not been told to stop using any Nvidia products, adding it was unlikely that Beijing would ban the U.S. firm’s auto chips.

“I don’t think any country will do that, because this automatic will kill Nvidia,” Li said. “So Nvidia now is the highest market value company, so if they lose the big market from China … nobody wants to see this.”

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Amazon faces off against FTC over ‘deceptive’ Prime program

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Amazon faces off against FTC over 'deceptive' Prime program

Bloomberg | Bloomberg | Getty Images

Amazon and the Federal Trade Commission are squaring off in a long-awaited trial over whether the company duped users into paying for Prime memberships.

The lawsuit, filed by the FTC in June 2023 under the Biden administration, alleges that Amazon deceived tens of millions of customers into signing up for its Prime subscription program and sabotaged their attempts to cancel it. Amazon has denied any wrongdoing.

The trial is being held in a federal court in Seattle, Amazon’s backyard. Jury selection began Monday and opening arguments are slated for Tuesday, with the trial expected to last about a month.

Launched in 2005, Amazon’s Prime program has grown to become one of the most popular subscription services in the world, with more than 200 million members globally, and it has generated billions of dollars for the company. Membership costs $139 a year and includes perks like free shipping and access to streaming content. Data has shown that Prime members spend more and shop more often than non-Prime members.

Amazon founder and executive chairman Jeff Bezos famously said the company wanted Prime “to be such a good value, you’d be irresponsible not to be a member.”

Regulators argue that Amazon broke competition and consumer protection laws by tricking customers into subscribing to Prime. They pointed to examples like a button on its site that instructed users to complete their transaction and did not clearly state they were also agreeing to join Prime for a recurring subscription.

“Millions of consumers accidentally enrolled in Prime without knowledge or consent, but Amazon refused to fix this known problem, described internally by employees as an ‘unspoken cancer’ because clarity adjustments would lead to a drop in subscribers,” the agency wrote in a court filing last week.

The FTC says that the cancellation process is equally confusing, requiring users to navigate four webpages and choose from 15 options — a “labyrinthian mechanism” that the company referred to internally as “Iliad,” referencing Homer’s epic poem about the Trojan War.

Amazon has argued that the Prime sign up and cancellation processes are “clear and simple,” adding that the company has “always been transparent about Prime’s terms.”

“Occasional customer frustrations and mistakes are inevitable — especially for a program as popular as Amazon Prime,” the company wrote in a recent court filing. “Evidence that a small percentage of customers misunderstood Prime enrollment or cancellation does not prove that Amazon violated the law.”

A crackdown on ‘dark patterns’

The FTC notched an early win in the case last week when U.S. District Court Judge John Chun ruled Amazon and two senior executives violated the Restore Online Shoppers’ Confidence Act by gathering Prime members’ billing information before disclosing the terms of the service.

Chun also said that the two senior Amazon executives would be individually liable if a jury sides with the FTC due to the level of oversight they maintained over the Prime enrollment and cancellation process.

Amazon’s Prime boss Jamil Ghani and Neil Lindsay, a senior vice president in its health division who previously oversaw Prime’s technology and business operations, are named defendants in the complaint.

Russell Grandinetti, Amazon senior vice president of international consumer, is also named in the suit, but Chun argued he had “less involvement in the operation of the Prime organization” compared to Ghani and Lindsay.

Chun also scolded attorneys for Amazon in July for withholding thousands of documents from the FTC and abusing a legal privilege to shield them from scrutiny. Among the documents was a 2020 email where Amazon’s retail chief Doug Herrington said “subscription driving” was a “shady” practice and referred to Bezos as the company’s “chief dark arts officer.”

Representatives from Amazon didn’t immediately respond to a request for comment.

Amazon also faces a separate lawsuit brought by the FTC in 2023 accusing it of wielding an illegal monopoly. That case is set to go to trial in February 2027.

The Prime case is part of the FTC’s broader crackdown on so-called “dark patterns,” which it began examining in 2022. The phrase refers to deceptive design tactics meant to steer users toward buying products or services or giving up their privacy.

The agency brought a similar dark patterns lawsuit against Uber in April, accusing the ride-hailing and delivery company of deceptive billing and cancellation practices tied to its Uber One subscription service. Uber has disputed the FTC’s allegations.

Earlier this year, it reached settlements with online dating service Match and online education firm Chegg over claims that their subscription practices were deceptive or hard to cancel.

WATCH: Exclusive: Amazon just launched its Zoox robotaxis in Las Vegas and we took a ride

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