Zoom to acquire cloud-based contact center software Five9 in $14.7B deal

UPDATE (September 30, 2021): Zoom and Five9 terminates $14.7B merger deal

Zoom announced in a statement that it is acquiring cloud contact center software provider Five9 for $14.7 billion in an all-stock transaction, making it Zoom’s first billion-dollar acquisition. The deal is expected to close in the first half of 2022.

According to FactSet, this is the second largest technology acquisition in the United States this year, after Microsoft’s planned $16 billion purchase of Nuance Communications. The acquisition is expected to help enhance Zoom’s presence with enterprise customers and to accelerate its long-term growth opportunity by adding the $24 billion contact center market. 

“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,” said Eric S. Yuan, Chief Executive Officer and Founder of Zoom. 

Zoom revenue for the first quarter of 2021 was $956.2 million, up 191% year over year. According to FactSet, the company’s shares have multiplied in value since 2020, giving it a market capitalization of $106.7 billion. 

“Zoom is built on a core belief that robust and reliable communications technology enables interactions that build greater empathy and trust, and we believe that holds particularly true for customer engagement. Enterprises communicate with their customers primarily through the contact center, and we believe this acquisition creates a leading customer engagement platform that will help redefine how companies of all sizes connect with their customers. We are thrilled to join forces with the Five9 team, and I look forward to welcoming them to the Zoom family.”

Having more than 2,000 customers worldwide including Under Armour, Citrix, and Lululemon Athletica Inc, Five9 Intelligent Cloud Contact Center provides solutions such as digital engagement, analytics, workflow automation, workforce optimization and practical AI services to help customers reimagine their customer experience. 

Following the close of the transaction, Five9 will be an operating unit of Zoom and Rowan Trollope will become a President of Zoom and continue as CEO of Five9, reporting to Eric Yuan. 

“Businesses spend significant resources annually on their contact centers, but still struggle to deliver a seamless experience for their customers,” said Rowan Trollope, Chief Executive Officer of Five9. 

As part of the agreement approved by the boards of directors of both companies, Five9 stockholders will receive 0.5533 shares of Class A common stock of Zoom for each share of Five9. 

“It has always been Five9’s mission to make it easy for businesses to fix that problem and engage with their customers in a more meaningful and efficient way. Joining forces with Zoom will provide Five9’s business customers access to best-of-breed solutions, particularly Zoom Phone, that will enable them to realize more value and deliver real results for their business. This, combined with Zoom’s ‘ease-of use’ philosophy and broad communication portfolio, will truly enable customers to engage via their preferred channel of choice.”