Investopedia: Adobe Patches A Hole With A $600 Million Purchase

Make no mistake about what Adobe (Nasdaq:ADBE) management is thinking – the company's legacy digital media business (Creative Suite/Creative Cloud, which includes well-known offerings like Photoshop) is primarily a source of cash flow, while digital marketing/marketing cloud is where the company's future growth will be generated. To that end, Adobe is spending another $600 million to enhance its capabilities and compete more effectively with the likes of Oracle (Nasdaq:ORCL), IBM (NYSE:IBM), and Salesforce.com (NYSE:CRM).

Spending Money To Make Money
Adobe announced Thursday evening that it had reached an agreement to acquire privately-held Neolane for $600 million in cash. While certainly not a household name to most investors, Neolane is an emerging player in marketing management software, with a strong position in areas like lead management and cross-channel campaign management.

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Investopedia: Salesforce.com Doesn't Wait Long To Build Its Marketing Cloud

It was less than two weeks ago when I speculated (as many others have as well) that Salesforce.com (NYSE:CRM) was preparing to do an acquisition to expand and build its marketing cloud capabilities. At the time I also suggested that cross-channel digital marketing specialist ExactTarget (NYSE:ET) could be a credible target. On Tuesday morning both of those predictions came home to roost, as Salesforce.com announced an all-cash bid for ExactTarget.

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Investopedia: Salesforce.com Still Growing And Still Expensive

Cloud software and services continues to take share in the enterprise IT market, and Salesforce.com (NYSE:CRM) remains a major player within that trend. Even so, growth is slowing and the company has yet to make a convincing case that there is all that much latent margin leverage in the business model. With attractive top-line growth and a “clean” play on the growth of SaaS/PaaS, I expect Salesforce.com to remain a relatively popular software stock, but I likewise expect bears to continue complaining (loudly) about the valuation, particularly given the weak margin leverage and an underlying growth rate that may be weaker than it first appears.

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