When it comes to Microsoft Corp.’s (MSFT) $26 billion acquisition of professional social network LinkedIn, the deal isn’t about finding synergies and duplicate costs but about growing its user base, said Microsoft’s Chief Financial Officer Amy Hood.
Speaking during the Morgan Stanley Technology, Media and Telecom Conference, which was covered by CNBC, Hood said she is focused on top-line revenue and “accelerating” the business rather than finding synergies. "To add more customers. To increase their impact. To have it grow faster. To accelerate our business. To have the technical integration to deliver customer value ... I'm deeply, deeply focused on driving revenue growth,” Hood was quoted as saying. What’s more, Hood said she’s not bothering LinkedIn CEO Jeff Weiner about integrating the two companies, noting that “smart things” in terms of integration will come. "You want to keep the core growing and they're doing a great job of that, things are good. They are motivated, Jeff's a great leader," Hood said. (See also: Microsoft's Cloud Push, LinkedIn Deal Dominate 2016.)
Microsoft Integrating Both Sales Teams
The one integration that is happening now is with the two companies’ sales teams. According to Hood, as Microsoft integrates LinkedIn into its office productivity tools, there will be more combining of the sales teams. In December, Microsoft’s $26.2 billion deal to acquire LinkedIn was approved by European Union regulators six months after it was announced. At the time, Microsoft CEO Satya Nadella referred to LinkedIn as "our Instagram," referring to the popular photo-sharing app acquired by Facebook Inc. (FB) in 2012 for $1 billion. Instagram, which is now worth an estimated $50 billion today, is broadly regarded as one of the best deals of all time. Much of Instagram's increased value, however, was driven by Facebook's ability to successfully integrate and grow Instagram in a manner that promotes high user engagement and, more importantly, advertising revenue. Bernstein analyst Mark Moerdler said at the time the deal closed that LinkedIn benefits Microsoft in three ways including a new revenue source since LinkedIn has 433 million professional users; a way to sell more of its Office Products and boost its customer relationship management initiatives.
During the investor conference, Hood also touched on tax reform under President Donald Trump. The executive said CEO Nadella is waiting and watching to see what form tax reform will actually take.