![]() ![]() These expenses can include everything from ransom payments and lost revenues to business downtime, remediation, legal fees, and audit fees. In 2022, the global average cost of a data breach reached $4.35 million, while the number is more than double in the U.S., averaging $9.44 million. Long-Term Impacts Are Emerging and Can Be More Significant Than ExpectedĪlthough fluctuations in stock prices may be a breeze for some executives to manage, the lasting effects of cyber incidents on companies are becoming more apparent.įirst, a cyber incident will directly consume a company’s resources, leading to an increased cost of doing business. In other words, you are only as good as your weakest link. Similarly, a security breach of a third-party supplier to Okta shaved about $6 billion off the company’s market cap during the week the incident was made public. ![]() For example, a ransomware attack on ION Trading Technologies on January 31 of this year sent financial institutions scrambling to confirm trades manually. Importantly, such an impact can reverberate throughout the entire supply chain, creating a ripple effect that can cause up to 26 times the loss for a company’s business ecosystem. Even more concerning is the fact that it took 46 days, on average, for these companies to recover their stock prices to pre-breach levels, if they were able to do so at all. Publicly traded companies suffered an average decline of 7.5% in their stock values after a data breach, coupled with a mean market cap loss of $5.4 billion. It is well known that a cyber incident can sink an organization’s stock price, especially in the short term. Billions of Dollars Lost in Market Cap With a Ripple Effect Is Common Moreover, Samsung semiconductor has recorded three incidents where employees accidentally leaked company information when using ChatGPT. These include OpenAI’s ChatGPT, which exposed the payment-related and other sensitive information of 1.2% of its ChatGPT Plus subscribers due to a bug in an open-source library it used. The severity of the situation continues to be evident with the public disclosure of at least 310 cyber incidents that occurred in the past three months alone, according to January, February, and March data from IT Governance. According to the 2022 Verizon Data Breach Investigations Report, the total number of ransomware attacks surged by 13%, which is a rise equal to the last five years combined. The latest IBM Data Breach Report revealed that an alarming 83% of organizations experienced more than one data breach during 2022.
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