Data breaches cost firms an average of USD $677 million

ExtraHop has released a new report examining the financial effects of high-profile data breaches on publicly traded companies.

The report finds that data breaches cost organisations an average of USD $677 million, which is significantly higher than previous industry estimates. This analysis, expanding on conventional research, includes data from SEC filings, stock performance, and quarterly earnings to offer a comprehensive view of the financial consequences organisations face post-breach.

The study further reveals an average 7% decline in the stock prices of affected organisations one month after a data breach. This underscores the financial repercussions for both the company and its shareholders.

Raja Mukerji, Co-founder and Chief Scientist at ExtraHop, commented on the findings: "Data breaches have profound impacts that are wildly underestimated by organisations until they find themselves in the middle of one. It's important for business leaders to recognise that no organisation is immune to cyberattacks or the potential financial fall-out that comes with them — nor can they be too prepared."

"Bad actors have experienced great success to date using the most basic tactics and techniques, highlighting a great need for organisations to re-evaluate their cyber risk and resilience postures."

One notable breach included in the report is projected to cost the affected organisation approximately USD $2.8 billion. This figure accounts for lost revenue, business disruptions, incident response, and remediation efforts following a ransomware attack that affected over 100 million customers. Almost half of the breaches highlighted in the report were unauthorised access, indicating a critical need for enhanced network visibility to swiftly detect and respond to suspicious activities.

ExtraHop is a cybersecurity company that specialises in providing visibility and analytics solutions designed to help organisations monitor and safeguard their networks. By leveraging its platform, businesses can gain critical insights into network traffic, detect anomalies, and respond to threats in real time, significantly enhancing their overall security posture.

ExtraHop's recent report highlights the substantial financial consequences of data breaches for publicly traded companies, with costs averaging USD $677 million—far exceeding previous industry estimates. As cyber threats evolve, organisations must prioritise investments in robust security measures and adopt a proactive risk management approach. Enhanced visibility and swiftly responding to potential breaches are essential for mitigating financial losses and safeguarding stakeholder interests in today's complex digital landscape.