Cisco acquires BabbleLabs to enhance its offering

  •   26/08/2020 - 16h32
  •   HARMANT Adeline

As you probably already know, the technology sector is one of the most attractive sectors for investors at the present time in view of the opportunities it has been able to take advantage of with the Covid-19 pandemic. This morning, Cisco Group made an announcement regarding the enhancement of its offer with the acquisition of BabbleLabs. We propose you to learn here a little more about this news and the analysts' forecasts regarding this stock.

--- Advertisement ---
Trade in Cisco shares!
76.4% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Cisco acquires BabbleLabs to enhance its offering
Image copyright: Prayitno

The acquisition of BabbleLabs by Cisco and its objectives :

It is thus by a press release published this morning that the Cisco Systems group announced its acquisition of the BabbleLabs company. This company is indeed working on technologies to eliminate noise and improve speech. It is therefore in order to improve its collaborative software offer, which has become very popular with companies due to the increase in teleworking, that Cisco is making this strategic acquisition.

BabbleLabs is a solution that uses artificial intelligence to detect human speech and reduce unwanted noise. Thanks to this solution, Cisco will be able to equip its teleconferencing software with a system that can, for example, eliminate annoying background noise during important meetings and conversations. This technology provided by BabbleLabs of course works in real time and can also improve the voice quality of the different speakers.

Thus, Cisco Systems group intends to do well in this period where companies manufacturing such software share the development opportunities of this segment by integrating BabbleLabs in particular to all its collaborative software including the Webex meeting software which are already a must on the market.

In the press release published this morning, the Cisco group also specified that the BabbleLabs company will join more precisely the Cisco collaboration solution called Cisco Collaboration Group following the conclusion of this agreement which should take place during the first fiscal quarter of this company.


Will this announcement impact Cisco stock?

As regards the forecasts of the analysts of this sector of activity, one will retain here that if the Cisco share lost a few points at the beginning of this month of August, they remain relatively optimistic. Indeed, the analyst Jefferies had thus announced in the middle of the month that he was revising his price objective upwards with a "buy" recommendation on this stock.

The target aimed by this broker had then passed from 49 to 51 dollars. The broker explained his decision by stating: "Cisco reported results that came as no surprise given the current pandemic/recession environment following VIDOC-19. The company has provided more flexible revenue expectations, but is working to preserve EPS (as it has historically done during periods of revenue pressure)".