On December 18, IBM announced that it will acquire StreamSets and webMethods, the enterprise technology platforms of European systems Software provider Software AG, for 2.13 billion euros (about 16.63 billion yuan) in cash. The transaction is expected to close in the second quarter of 2024. Industry insiders said that with the acquisition, IBM will further expand its map in artificial intelligence and hybrid cloud.

StreamSets is a cloud-native DataOps and data ingestion platform that allows enterprises to achieve consistent data access and delivery across a wide range of data sources and types. webMethods provides additional integration and API management tools for customers’ and partners’ hybrid multi-cloud environments that can be deployed in self-built facilities and cloud platforms. The two make up what Software AG calls its “Super iPaas” business, which includes modern application architecture, platform and ecosystem business models, integration, and business process automation.

Software AG said its iPaaS platform is growing and profitable, with significant recurring revenue, and the two services have more than 1,500 customers worldwide. Kerry Christian Lucas, Chairman of the Supervisory Board of Software AG and managing partner of Silverlake Investments, said the StreamSets and webMethods teams will be combined with the IBM team to build hybrid cloud and next-generation AI solutions for enterprises.

Rob Thomas, senior vice president and chief business officer for software at IBM, said StreamSets and webMethods will help customers unlock the full potential of their applications and data. IBM Senior Vice President Rob Thomas said this powerful combination helps drive innovation while preparing the business for AI, no matter where the applications or data are located.

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At present, IBM is vigorously seeking to strengthen its performance in the artificial intelligence and hybrid cloud market, in addition to the continuous integration of different cloud computing and self-built services, IBM has repeatedly expanded its territory by investing in mergers and acquisitions. In 2018, for example, IBM spent $34 billion to acquire software and services company Red Hat, a deal that was seen as an important step in IBM’s bet on hybrid cloud. In 2023, IBM acquired Apptio, Manta and other companies to complement its capabilities in artificial intelligence.

To streamline operations and focus on core strengths, IBM has also been shedding underperforming businesses. These include its semiconductor manufacturing, x86 servers, managed infrastructure services, Watson Health and other businesses.

Financial data show that in the third quarter of 2023, IBM’s total revenue was $14.752 billion, an increase of 4.6% compared with $14.107 billion in the same period last year; Operating income from continuing operations was $2.0 billion, an increase of 23 percent compared to the same period last year.

Revenue from the Software segment, which includes the Hybrid Platform and Solutions business and transaction Processing business, was $6.265 billion, an increase of 7.8% compared to the same period last year. Gross profit margin was 79.5%, also up from last year. In particular, revenue from the Hybrid Platform and Solutions business grew 8% year-over-year, and revenue from the Data and AI division grew 6% year-over-year. It can be seen that IBM’s emphasis on artificial intelligence and hybrid cloud is driving steady growth in core business revenue.