In a move to accelerate its cloud security capabilities, Alphabet, the parent company of Google, has announced plans to acquire the fast-growing cybersecurity startup Wiz for approximately $32 billion. This deal marks Alphabet’s largest acquisition to date, reinforcing its commitment to competing with Amazon and Microsoft in the cloud computing race.
The acquisition of Wiz, a leader in cloud security, will further enhance Google’s cloud business, which has seen significant growth, and will provide vital cybersecurity tools to help organizations mitigate critical risks in their cloud environments. The deal is set to strengthen Google’s offering as the company continues to expand its enterprise services and refine its security software solutions.
Alphabet’s cloud unit, which generated over $40 billion in revenue in 2024, has been a key growth driver in the company, surpassing growth in its core search business in recent years. By acquiring Wiz, Alphabet aims to deepen its product portfolio, particularly in the high-demand area of cybersecurity, to compete more effectively against its rivals, including Microsoft Azure and Amazon Web Services (AWS).
The deal, expected to close in 2026 pending regulatory approvals, will also allow Wiz’s products to remain available across other major cloud platforms, including AWS and Microsoft Azure. This move is designed to alleviate potential regulatory concerns, as Google has emphasized its commitment to interoperability between cloud platforms, a significant issue in recent antitrust discussions.
Despite Alphabet’s efforts to assure regulators, the deal has raised questions about its potential impact on competition, especially considering Google’s market position. Analysts, however, believe that the deal is justified by Wiz’s continued exponential growth. The Israeli startup was valued at $12 billion in a private funding round in 2024, and it is expected to contribute over $500 million in annual recurring revenue by mid-2024.
Wiz, which works with major global clients including Morgan Stanley, BMW, and LVMH, has previously collaborated with Google Cloud, adding credibility to the acquisition. In addition to its impressive client roster, Wiz is known for its robust security products, which have become increasingly sought after amid growing concerns over cybersecurity.
The high price tag and a termination fee exceeding $3.2 billion—one of the largest in M&A history—highlight the strategic importance of this acquisition for Alphabet. This is not the first acquisition by a Silicon Valley tech giant of an Israeli cybersecurity company; other notable deals include Microsoft’s purchase of Adallom in 2015 and Alphabet’s acquisition of Siemplify in 2022.
The acquisition also signals Alphabet’s ongoing commitment to cybersecurity, an area that has seen a surge in interest following significant security breaches, such as the global outage involving CrowdStrike in 2023.
As the deal undergoes regulatory scrutiny, experts are watching closely for any potential antitrust concerns, particularly given Alphabet’s growing influence in the cloud market. Critics have raised concerns about potential exclusivity arrangements between Wiz and Google Cloud, which could prompt closer scrutiny from regulators.
“This acquisition will be a key test for pro-business advocates,” said Dave Wagner, portfolio manager at Aptus Capital Advisors. “Given Alphabet’s historical challenges with capital allocation in M&A, it’s crucial that the company continues to manage such acquisitions carefully to avoid regulatory hurdles.”
As of December 31, Alphabet held $23.47 billion in cash and cash equivalents, leaving open the possibility of seeking financing for the deal.
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