Microsoft drops $16B to acquire Nuance in its biggest deal since LinkedIn

Microsoft’s CEO Satya Nadella really wants to spend cash.

As reported by CNBC, Nadella tried to buy TikTok last year for ~$30B. Since that deal fell apart, Microsoft has been linked to a number of huge-dollar deals:

• $7.6B for gaming company Zenimax
• ~$10B for a potential acquisition of chat platform Discord (TBD if deal will close)
• $16B for Nuance Communications, a speech recognition company

The Nuance deal was announced on Monday

And it will be Microsoft’s largest acquisition since buying LinkedIn in 2016 for $26B+.

Per CNBC, Nuance primarily sells “tools for recognizing and transcribing speech in doctor office visits, customer-service calls and voicemails.” Revenue hit ~$1.5B in 2020.

The deal will help boost Microsoft’s health care platform

Burnout is a big issue in the health care field, and the deluge of administrative work (e.g., note taking, report writing) contributes to the problem.

Doctors can use Nuance tech — which is already integrated with Microsoft Teams for virtual visits — to record conversations and automatically transcribe high-quality notes.

In general, the digitization of health care is a huge market, and Sadella seems more than happy to throw cash at the opportunity.