Today: Hewlett-Packard acquires Cupertino-based Voltage Security, which specializes in encryption and other data-protection measures. Also: Tough day on Wall Street as Yelp, GoPro and Pandora continue to tumble.
The Lead: Hewlett-Packard buys Voltage Security for undisclosed price
Amid widespread concerns about corporate data breaches, Hewlett-Packard announced Thursday the acquisition of a Cupertino company that made early strides in email encryption technology.
HP said it will purchase Cupertino’s Voltage Security for an undisclosed sum and will fold it into its security division, HP Atalla. Voltage was founded in 2002 by Stanford professor Daniel Boneh and three of his students, and in 2003 launched an early version of “identity-based” email encryption that bypassed the need for a public key in sending encrypted email.
Since those beginnings, Voltage has expanded its focus to include protecting corporate data as it moves around a company’s systems, including cloud storage and mobile access. The company, which received venture financing in 2005 and 2007 for a total of about $27 million, has especially focused on payment data, working with large processors to protect consumers’ financial data.
“What our customers need is a solution that protects sensitive information from the moment it’s created throughout its entire life cycle,” HP executive Art Gilliland wrote in a blog post announcing the deal.
Theft of corporate data has become a hot topic as criminals breach companies’ defenses to steal consumers’ personal data, such as the recent theft of up to 80 million health care records at insurer Anthem. Large Silicon Valley companies that cater to other large corporations have been beefing up their security offerings, including Cisco’s $2.7 billion purchase of Sourcefire last year.
“As we have seen with the high-profile attacks on Anthem, Sony, JP Morgan, Target, and eBay, the cyber security spending wave is showing no signs of slowing and thus the traditional large tech stalwarts need to acquire in this white hot area,” FBR Capital Markets analyst Daniel Ives noted in an email discussion about the HP acquisition Monday.
Since CEO Meg Whitman took charge of HP in 2011, the Palo Alto company has been less active in the acquisition market while dealing with the fallout from previous missteps in large acquisitions by her predecessors. Whitman’s infrequent dips into the merger pool have been focused on software aimed at companies, though, with the most prominent being the purchase of cloud-software firm Eucalyptus last year.
HP is planning to focus more on its enterprise offerings by splitting Silicon Valley’s second-largest technology firm in half, with Whitman retaining control of the separate company that will deal entirely with tech aimed at large companies.
The companies expect the acquisition to be complete by the end of the first half of 2015. HP shares dropped 0.8 percent to $37.64 Monday.
SV150 market report: Yelp, GoPro and Pandora continue decline
Wall Street dipped Monday, while a handful of Silicon Valley tech firms that suffered in the wake of earnings reports last week continued to struggle.
Yelp, Pandora and GoPro suffered a second consecutive session of losses Monday, with the more established companies reaching new 52-week lows. Yelp suffered the biggest drop in the SV150 Monday, falling another 6.5 percent to $42.17 to complete a two-day decline of 26.6 percent after a slowdown in user growth. Pandora declined 2.8 percent to $14.82, its lowest closing price in the past year, after its finances disappointed, and GoPro fell 5.6 percent to $44.48. Monday’s sole SV150 earnings report, Silver Spring Networks, didn’t result in as big a move, with shares declining about 1 percent in late action after the San Francisco cleantech company reported profits of $501,000, or a penny a share on sales of $77.4 million. The biggest earnings action this week will be Wednesday, when Tesla Motors and Cisco Systems announce earnings; Tesla gained 0.1 percent to $217.48 Monday, while Cisco fell 0.4 percent to $27.12.
Apple gained 0.7 percent to $119.72 as a report noted that the Cupertino company’s iPhone is taking in 93 percent of all the smartphone profits in the world. Netflix dropped 0.3 percent to $443.07 while announcing plans to launch in Cuba, as Dish Network’s attempt at a streaming cable package debuted in the United States. Twitter’s big post-earnings jump ended after one day, as shares declined 1.4 percent to $47.32 amid more transparency on data requests from the company, and rival Facebook lost 2 cents to $74.44 as Bloomberg News detailed CEO Mark Zuckerberg’s fight with a Palo Alto neighbor.
Up: SolarCity, LinkedIn, Oracle, Apple, SunPower, Zynga, AMD, Tesla
Down: Yelp, GoPro, Applied Materials, Pandora, Salesforce, EA, Twitter, VMware, Juniper, Intel
The SV150 index of Silicon Valley’s largest tech companies: Down 2.91, or 0.17 percent, to 1,681.52
The tech-heavy Nasdaq composite index: Down 18.39, or 0.39 percent, to 4,726.01
The blue chip Dow Jones industrial average: Down 95.08, or 0.53 percent, to 17,729.21
And the widely watched Standard & Poor’s 500 index: Down 8.73, or 0.42 percent, to 2,046.74
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