Google reportedly has walked away from a potentially massive deal to buy CRM provider HubSpot, a merger that would have helped Google Cloud.

Google reportedly has abandoned its plans to acquire CRM specialist HubSpot, axing a potential deal that would have been worth billions and aided Google Cloud.

HubSpot generated over $2 billion in revenue last year on an operational loss of $176 million. The Cambridge, Mass-based company currently has a market capitalization of over $25 billion, down from $32 billion when the news of the potential Google acquisition first emerged in April.

In April, Google’s parent company, Alphabet, was reportedly looking to acquire HubSpot and had already met with investment bankers.

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The CRM company provides a unified software platform that delivers connections for customer-facing teams that includes AI-powered engagement hubs, a smart CRM, and a connected ecosystem with over 1,500 application marketplace integrations.

However, the deal did not progress far and fell apart, according to a Bloomberg report.

Google and HubSpot did not respond to CRN’s request for comment on the matter by press time.

HubSpot Stock Falls 12 Percent

The news of the deal falling apart caused HubSpot’s stock to drop 12 percent.

HubSpot stock fell from $533 per share Wednesday afternoon to $464 per share over the course of just one hour. The stock rebounded to $491 per share at market close Wednesday.

As of Thursday morning, HubSpot’s stock is currently trading at $503 per share.

Google’s stock has not been impacted by the news.

HubSpot Could Have Help Google Cloud

Although Alphabet would have officially acquired HubSpot, the merger could have benefited Google Cloud.

Google Cloud would have had a business to compete against CRM market leaders like Microsoft, Oracle and Salesforce. HubSpot creates software to help companies automate their marketing operations and reach out to prospective customers.

HubSpot’s Service Hub, which helps customer service departments manage their daily work, would have also opened up net-new sales opportunities. Its cloud-based Marketing Hub software is used by marketers to create advertising campaigns, distribute promotional content and other various marketing tasks.

Google Cloud became profitable for the first time in 2023. The Mountain View, Calif.-based cloud giant generated $9.6 billion in sales during first-quarter 2024, up 28 percent year over year, with operating income of $900 million.