Cloud Software Vendor Qualtrics Files For January IPO

Cloud software vendor Qualtrics is readying to go public, according to CNBC.

Qualtrics was acquired by SAP two years ago, but it filed paperwork with the SEC Monday (Dec. 28) to strike out on its own as a separate company.

Qualtrics, which works in software to aid businesses in gauging how customers are using their products to boost offerings, is looking to capitalize on the new wave of interest in cloud software. That was already in demand before the pandemic, but has seen expedited growth as the pandemic forced many companies to work from home.

SAP announced its plans to spin Qualtrics off in July, while still keeping most of its ownership for the time being. That will let it generate profits if the stock rallies. The IPO is expected to come by early January, and SAP will own 80 percent of the outstanding shares.

According to the filing from Qualtrics, private equity firm Silver Lake is buying a bit over 4 percent of the stock for $550 million, and Smith is buying 1 percent for $120 million.

Under its brief tenure with SAP, CNBC writes that Qualtrics kept growing, with revenue climbing 30 percent in the first three quarters this year, hitting $550 million. That's up from $413.4 million at the same time in 2019 and $289.6 million in 2018 prior to the acquisition, CNBC writes.

The IPO will be priced initially at $20 to $24 per share. That would value Qualtrics at somewhere between $12 billion to $14.4 billion, which is more than the $8 billion paid by SAP, CNBC writes.

PYMNTS writes that an IPO could fetch as much as $18.7 billion, which would be more than twice as much as what SAP paid.

SAP CEO Christian Klein said the IPO would “provide the greatest opportunity” for Qualtrics to gain in the experience management category and serve customers, along with exploring its own acquisition strategy and continuing to hire the best talent possible.