[manquer]

Adjusting for inflation 26B from 2016 is worth 32B now. Going by just market returns 26B in S&P 500 in 2016, would be worth 70B today.

Also 26B is just initial investment, MS surely invested more money in the division in last 8 or so years, Linkedin was not exactly highly profitable entity in 2016, while it was not burning a lot of money, growth experienced in last few years would have needed additional investments in the business.

I don't have specific opinion on whether MS overpaid are not, just want to point out even 100B valuation today does not necessarily mean its high RoI for MS yet.

[joshhart]

LinkedIn was already very FCF positive. They tightly managed margins to get to net income positive (account for dilution and so on) but it took maybe 2 years after the acquisition.

[manquer]

Of course, they were and are healthy company, i was just trying to say they while very healthy it was not so profitable that just by using the free cash flow MS could have grown the business to today's size, it likely required external cash infusion and therefore $26 Billion is likely not the only money MS has spent on Linkedin.

As far as M&As go, it is very successful outcome, vast majority of them fail spectacularly, RoI is not perhaps the right metric to judge a strategic acquisition.