Google announced on Tuesday, March 8 that the company plans to acquire Mandiant, aiming to better protect its cloud computing services customers. Google said it would pay $23 per share to the cybersecurity company, founded in 2004, which puts the deal worth about $5.4 billion.
If completed, it would be Google's second-largest ever acquisition, after its $12.5 billion acquisition of Motorola in 2012.
After the acquisition, Mandiant will join Google's cloud computing division, and Thomas Kurian, CEO of Google Cloud Computing, said in a statement: "The world is facing unprecedented cybersecurity challenges. We look forward to Mandiant joining Google Cloud to further strengthen our security operations suite and consulting services and help customers solve the security challenges they value most."
Dan Ives, an analyst at investment bank Wedbush, wrote in a note to investors on Tuesday, "As cyberattacks increase by day, Google is working with Mandiant to strengthen its cybersecurity footprint and hopes to pull a gap with giants like Microsoft and Amazon in the cloud computing race."
With the rise of the digital economy, cybersecurity has also received attention in China. Zhou Hongyi, founder of 360 Group, recently said that he proposed to upgrade network security to digital security and incorporate it into the new infrastructure. According to Zhou Hongyi, "The proportion of digital security investment in the mainland is relatively low in the world, and cyber security in developed countries has accounted for 10% of the overall IT investment, while the domestic investment is less than 1%."
According to media reports, at this year's two sessions, Zhou Hongyi will once again provide suggestions and suggestions for the development of network security in the digital era, focusing on digital security, intelligent connected vehicle security, open source software security and digital transformation security of small and medium-sized enterprises.
In addition to the domestic network security leader 360, Qianxin also occupies a very important position.
Founded in 2014, Qianxin initially did the domestic substitution of government and enterprise customers, benefited from the general trend of localization industry, and gradually replaced overseas manufacturers such as Symantec and McAfee. Later, the integrated terminal management product Tianqing was launched, which is a software form, adopts the license charging mode, and has 9 functional modules, including about 60 subdivided functions, including centralized management and control, terminal security protection, vulnerability and patch management, operation and maintenance control, mobile storage management, host audit, EDR (detection and response), threat assessment and terminal data security.
In particular, T&Tgen is not just a traditional antivirus software, but integrates EDR as an active security method, which can let users know when an attacker enters the network, and detect the attack path when an attack occurs, helping users to react to security events in a timely manner. The advantages of EDR are also reflected in the application of big data and AI, and the ability to deal with unknown threats is stronger.
According to the company's official website, the company's "revenue scale is the first, product coverage is the first, the number of employees is the first", and on July 22, 2020, it was successfully listed on the Science and Technology Innovation Board, and was praised by the media as "a brother of cybersecurity".
The status of "cyber security brother" is also supported by data. According to IDC statistics, Qianxin ranked first in the domestic terminal security market with a share of 23.5% in 2019, followed by AsiaInfo Security and McAfee, with the top three accounting for nearly 40% of the share.
The company also played an important role in this year's Beijing Winter Olympics. On December 26, 2019, Qianxin officially became the official cybersecurity service and anti-virus software sponsor of the Beijing 2022 Winter Olympic and Paralympic Games for the first time, providing cybersecurity for the Most Influential International Sports Event of the Winter Olympics.
In terms of company development, Qianxin recently released its 2021 performance report. According to the performance express, In 2021, Qianxin achieved a total operating income of 5,810,833,400 yuan, an increase of 39.64% over the same period of the previous year; and a net profit attributable to the owners of the parent company of -552,351,700 yuan, an increase of 65.19% over the same period of the previous year. During the Reporting Period, the Company was in a good financial position, with total assets of RMB13,475,264,400, an increase of 5.51% over the beginning of the year, and equity attributable to owners of the parent company of RMB9,898,060,900, down 1.10% from the beginning of the year.
The company said in the performance report that the company continued to lead the terminal security (including cloud server and virtualization terminal protection) market, the market share continued to rank first, the total revenue exceeded 800 million yuan, an increase rate of more than 30%; in the border security, security services and security operations and other business areas have rapid growth in revenue.
As for the reasons for the large loss of net profit, the company explained in the performance report:
1. The company exclusively undertook the network security task of the Beijing Winter Olympics, and invested in research and development in advance during the reporting period, and it is expected that the increase in the company's research and development expenses will drop significantly in the future.
2. The company's 2020 restricted stock incentive plan will affect about 435 million yuan in total the share payment fees generated by the company's 2020 restricted stock incentive plan in 2021 and the company's social security reduction and reduction fees due to the epidemic in 2020. Excluding the above factors, net profit attributable to owners of the parent company during the reporting period narrowed significantly from the loss in the same period last year.
When the company accepted the institutional survey on January 28, the company said that the company launched the employee restricted stock incentive plan in 2020, and the company's employee share payment expenses increased by 256 million yuan compared with 2020 during the reporting period, which had a certain impact on the net profit attributable to the owners of the parent company; on the other hand, the company actively prepared for the Olympic Games, and the relevant investment had a certain impact on the net profit during the reporting period.
The author has dug deeper into the above two interpretations of the company:
1. For the explanation of R&D investment by Winter Olympic companies, the author uses the indicator of "total R&D expenditure as a proportion of revenue" to measure, 29.51% in 2020, and 52.68% in 2021, which shows that the increase in R&D investment has indeed become one of the important factors affecting net profit.
2. For the situation of equity incentives, according to the statistics of Zhongyuan Securities, the agency believes that in 2022, the comprehensive network security companies that still have a relatively large pressure on the provision of equity incentive expenses include: 326 million yuan, Qianxin 152 million yuan, Tianrongxin 70 million yuan, Venustech 154 million yuan, and Anheng Information 0.67 billion yuan (the above is the forecast value).
For the situation of Qianxin in 2022, Zhongyuan Securities stated that in 2022, The equity incentive fee of Qianxin will fall from 291 million to 152 million yuan, reducing the pressure on profitability. The agency also analyzed the impact of equity incentive expenses on net profit for the current period (see chart below). As can be seen from the figure, in 2022-2024, the equity incentive fee will show a downward trend and will not have as much impact as in 2021 (blue column in the figure).
Recently, the company's stock prices have fallen rapidly, and the market is a little worried about some issues. On January 26 and January 27, the company received a total of 267 institutional surveys, and published two meeting minutes on January 28. The author has found some answers from the minutes of the institutional research meeting released on January 28, which may be able to form a reference for investors. The author has annotated some key sentences (see the figure below, excerpted from the minutes of the Institutional Research Meeting on January 28).
Some of the main views are that network security is the core support and premise guarantee of digital transformation, which is just needed.
In addition, the company said on the investor interactive platform on March 9 that the company has the ability to undertake "national" network security orders! The international market is an important part of the company's future revenue growth.
For the 2022 market strategy, the company talked about four countermeasures at the aforementioned institutional research meeting:
1. The company comprehensively promotes the "legion" strategy, enhances the stickiness of the head customer and the output of the single customer, the company said that "the resources are gathered into the legion, and the new needs of the large-scale customers are overcome in a systematic and practical way";
2. Continue to deepen the company's channel strategy, focusing on the coverage rate of practical offensive and defensive products in the local market and enterprise customer market;
3. The product strategy focuses more on the layout of new track products, and continues to polish the actual combat offensive and defensive capabilities and R & D platform capabilities;
4. With the help of the scenario-based security scheme of the Winter Olympics, the follow-up will be reused and landed in large-scale customer scenarios.
After hours on March 8, Qianxin announced the launch of the repurchase plan. According to the announcement, the total amount of the company's repurchase funds is 150 million yuan to 300 million yuan, and the repurchase price does not exceed 80 yuan / share. The repurchase period is 6 months from the date of the Board of Directors' consideration and approval of the share repurchase plan. As of March 8, Qianxin's stock price closed at 61.94 yuan per share, with a market value of 42.2 billion yuan. This is the first time that the company has launched a repurchase program since the listing of A shares. (See March 9 Announcement "Proposal on the Plan to Repurchase the Company's Shares by Means of a Centralized Auction Transaction")
Qianxin said that the repurchased shares will be used for employee stock ownership plans or equity incentives at an appropriate time in the future, and the repurchase is based on the confidence in the company's future development and the recognition of the company's long-term value, improving the company's long-term incentive mechanism, fully mobilizing the enthusiasm of the company's employees, improving the cohesion of the company's employees, and effectively closely combining the interests of shareholders, the interests of the company and the personal interests of employees.
Recently, the market has been poor, and a number of companies have launched repurchase programs to convey confidence to the market. As of March 8, more than 40 listed companies in Shanghai and Shenzhen had disclosed repurchase plans and announcements on the progress of repurchases, and a number of listed companies had disclosed announcements on shareholders' or executives' increase in shareholdings.
Among them, 21 companies in Shanghai alone submitted announcements related to increased holdings and repurchases, including large and medium-sized companies such as Qianxin, Haier Zhijia, Zhengtai Electric Appliances, and 360.
Author: Xu Yuanyao