By Dhirendra Tripathi

Investing.com – Splunk stock (NASDAQ:) surged 7.6% in premarket trading Monday on reports Cisco (NASDAQ:) has offered to buy the software maker for more than $20 billion.

Splunk had a value of $18.18 million at the closing Friday. The bid was made recently but the companies aren’t currently in active talks, The Wall Street Journal said.

Splunk makes software used by companies’ information technology and security operations to monitor and analyze data.

Although Cisco has traditionally made the majority of its revenues from security and router sales, it is trying to develop a range of software applications that will help grow its software business. Webex, the company’s conferencing platform for business meetings, saw sales rise in response to the pandemic. It is competing with Zoom (Microsoft) and Teams (Microsoft).  

The total revenue for 2015 was $15 billion. Software sales made up more than 30%. Revenue from subscriptions rose by 15% in the same period.  

Since Doug Merritt’s resignation in November, Splunk was looking for a new CEO. After several quarters with disappointing results, Merritt left the company. For six years, he was the CEO. He currently serves as interim CEO.

Splunk projects that the annual revenue for 2011 will reach $2.54 Billion. On March 2, Splunk will release its financial results.

Splunk shares fell more than three-quarters of their value during the past year following the rise of the pandemic’s first half to all-time highs.