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Targets’ earnings fall after data breach

The Wall Street Journal and other media have reported that US retail giant Target Corp’s profits have fallen by 46% following a massive data breach – one of the biggest credit card theft in history. Sales fell by over 5% as a direct result of a loss of confidence in shoppers following the breach. Not only that, but the costs of remedial action has run into hundreds of millions of dollars and there are over 80 law suits underway and possible action from the US regulator.

This is the first time I recall seeing such a cause-and-effect direct link placed between company profitability and a data breach.

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