Nimble Storage Inc. (NMBL - Free Report) skyrocketed by 46% to $12.58 yesterday after Hewlett Packard Enterprise (HPE - Free Report) announced their $1 billion acquisition of Nimble.

Founded in 2007, Nimble is headquartered in San Jose, CA. The technology company makes flash-optimized storage devices and a combination of hard disk and flash drives. The flash storage device technology tends to be more reliable and requires less energy to operate because there are no moving parts. According to research firm International Data Corp., the flash storage industry is expected to rise to nearly $20 billion in 2020.

Suresh Vasudevan, CEO of Nimble Storage, expressed excitement about the buyout, as they will gain exposure and larger clientele that the company needs. “As proud as we are of what we have accomplished, we face a challenge of scale and significant exposure as a standalone storage company,” said Vasudevan in a statement.

Nimble released their fourth quarter earnings in 2017 along with the acquisition news. The company reported a 30% increase in revenues to $117 million year-over-year; however, Nimble struggled to make a profit. The company posted a $36.4 million net loss, compared to a net loss of $32.4 million in the same period a year ago.

While Nimble will benefit from Hewlett Packard’s large operation and presence in the technology world, Nimble also allows HPE to tap into new markets and strengthen competitiveness in their existing markets.

The company posted a 10% drop in their first quarter earnings while storage sales fell 13%. This was the largest drop in quarterly revenue since the company split into two companies in 2015. Due to competitors like Amazon.com (AMZN - Free Report), the cloud-base storage service is beating out the demands for older storage services that HP still provides.

This acquisition could give both companies the push they need. Nimble will be able to grow their customer bases with HPE’s backing against their rival, Pure Storage (PSTG - Free Report). HPE will gain not only gain the latest flash-storage technology, but also Nimble’s new product, Nimble Cloud Volumes, the enterprise-grade storage service, to compete in the cloud-services industry.