ExtraHop has released a report analyzing the short- and long-term financial impacts high-profile data breaches have on publicly traded companies.
According to the findings, a data breach costs an organization $677 million on average, millions more than what has been disclosed in conventional research.
Expanding the scope of traditional research to date, the report triangulates a range of data sources, including SEC filings, stock performance, and quarterly earnings.
The report shows stock prices of the affected organizations dropped an average of 7% one month post-data breach – demonstrating the financial impact to not only the breached company, but shareholders too.
“Data breaches have profound impacts that are wildly underestimated by organizations until they find themselves in the middle of one,” said Raja Mukerji, Co-founder and Chief Scientist, ExtraHop.
“It’s important for business leaders to recognize that no organization is immune to cyberattacks or the potential financial fall-out that comes with them – nor can they be too prepared.”
One breach included in the report is expected to cost the impacted organization an estimated $2.8 billion, inclusive of lost revenue, business disruption, incident response and remediation, after a threat actor gained unauthorized access to the company’s systems to carry out a ransomware attack that impacted more than 100 million customers.
Unauthorized access was the cause of nearly half of the breaches highlighted in the report, demonstrating a growing need for robust network visibility to detect and respond to suspicious behaviors quickly.
