ServiceNow Agrees to Acquire Cybersecurity Startup Armis for $7.75 Billion

Enterprise software company ServiceNow has agreed to acquire cybersecurity startup Armis for a staggering $7.75 billion in cash, marking a significant valuation jump for the nine-year-old company. This deal comes just a month after Armis raised a $435 million pre-IPO funding round, valuing the company at $6.1 billion. The acquisition is a testament to Armis's rapid growth and its potential to expand ServiceNow's cybersecurity offerings.

The financial details of the deal reveal that Armis has reached $340 million in annual recurring revenue (ARR), with year-over-year growth exceeding 50%. This impressive growth trajectory has caught the attention of investors, with Armis having raised a total of $1.45 billion in venture capital from prominent investors, including Sequoia and Coatue.

The acquisition is a significant milestone for Armis, which had been planning to go public in late 2026 or 2027. However, the unpredictability of IPO markets and the relatively low success rate of cybersecurity companies going public may have contributed to the company's decision to opt for a merger and acquisition (MA) exit. According to Armis co-founder and CEO Yevgeny Dibrov, an IPO was his personal dream, but the company's growth and valuation have made an MA exit an attractive option.

The acquisition is also a strategic move for ServiceNow, which has been expanding its cybersecurity offerings through a series of high-profile acquisitions. In addition to the Armis deal, ServiceNow has scooped up Moveworks for $2.85 billion and agreed to acquire cybersecurity startup Veza for $1 billion. These acquisitions demonstrate ServiceNow's commitment to expanding its portfolio of cybersecurity solutions and its ability to make strategic investments in the rapidly evolving cybersecurity landscape.

Armis provides security software for critical infrastructure to Fortune 500 companies and governments, and its technology will help ServiceNow expand its cybersecurity offerings to a wider range of customers. The company's software is designed to provide real-time visibility and control over IoT devices, networks, and cloud services, making it an attractive addition to ServiceNow's portfolio.

The acquisition is expected to have a significant impact on the cybersecurity industry, as it demonstrates the growing importance of cybersecurity solutions in the enterprise software market. ServiceNow's acquisition of Armis is a testament to the company's ability to make strategic investments in the cybersecurity space and its commitment to expanding its portfolio of cybersecurity solutions.

As the cybersecurity landscape continues to evolve, companies like ServiceNow and Armis are well-positioned to capitalize on the growing demand for cybersecurity solutions. With Armis's technology and expertise, ServiceNow is poised to become a leading player in the cybersecurity market, providing customers with a comprehensive suite of cybersecurity solutions to protect their critical infrastructure.

The acquisition is expected to close in the coming months, subject to regulatory approval. Once completed, the deal will provide Armis's customers with access to ServiceNow's extensive portfolio of cybersecurity solutions and its global network of customers and partners.