The acquisition will add critical cloud management and edge capabilities to Extreme's portfolio of end-to-end, edge to cloud networking solution and strengthen the company’s wireless LAN offering.
It will also provide Extreme with a subscription revenue stream, as Aerohive has a global footprint of 30,000 cloud wireless LAN customers in verticals including education, healthcare, state and local government, and retail. Extreme expects that as a result of the acquisition, approximately 30 per cent of its revenue will come from reoccurring subscription revenue.
Extreme also expects that Aerohive’s adding cloud-managed Wi-Fi and NAC solutions, will complement its on-premises Wi-Fi and NAC technology. Aerohive currently offers a range of three Wi-Fi 6 (802.11ax) access points and claims to be a leader in cloud management, AI and machine learning.
Ed Meyercord, Extreme Networks’ president and CEO, said: "The acquisition of Aerohive establishes our leadership in cloud, AI, and ML, adding a proven and mature cloud services platform and subscription service model for Extreme's customers and partners. Extreme continues to invest in software and AI to expand the automation capabilities across our portfolio of edge-to-cloud networking solutions. The ability to improve user experiences, lower operating expenses, and deliver cloud-managed networks is key to our strategy."
"After scaling Extreme's business to $1B in revenue and expanding our portfolio to include end-to-end enterprise networking solutions, we are now taking the next step to transform our business to add sustainable, subscription-oriented cloud-based solutions that will enable us to drive recurring revenue and improved cash flow generation..."
David Flynn, Aerohive’s president and CEO, said: “This acquisition by Extreme is a major milestone for Aerohive. The role that cloud-managed technology plays in modern enterprises is impossible to overstate – it is where digital transformation is won and lost. Aerohive's expertise and excellence in cloud management and edge technology, combined with Extreme's extensive solutions portfolio and continued investment in software and AI for automation, gives our customers the most advanced digital experiences in the market. Together we will push networking into a new era – making infrastructure smarter, more autonomous, and the driver of business value."
