Profits are set to fall in the wake of the Dixons Carphone cyber-attack. A sharp fall in profits is expected after news of the massive cyber-attack that exposed some 5.9 million credit and debit card details, and some 1.2 million personal data records.
Some reports have indicated the fall in profits may be as much as 23pc.
The Dixons Carphone cyber-attack apparently took place last year, yet it has taken them almost a year for the news to be revealed; a matter that they will no doubt face further criticism for.
This year’s Mega Breach
The Dixons Carphone cyber-attack may well be this year’s mega breach, despite the fact that it actually took place almost a year ago. Because it didn’t happen after the new GDPR came into force, it’s understood that Dixons Carphone will avoid fines that could have run into the millions after the Information Commissioner’s Office (ICO) was handed far greater powers with far larger fines.
Last year was the year of the Equifax mega breach. 2018 is looking to belong to Dixons Carphone.
How the Dixons Carphone cyber-attack happened
It’s understood that the cyber-attack occurred when advanced malware managed to break into the processing systems for Currys PC World and Dixons Travel stores. Of the 5.8 million payment card details exposed, it’s understood that 105,000 of the cards are not chip-and-pin protected, leaving them to be the most vulnerable.
The fact that it has taken a year for the breach to be revealed is a further concern. It’s understood that the reason for the delay may be related to a change of management that triggered a system-wide review, but this does not explain how, or why, the Dixons Carphone cyber-attack was not picked up on or reported until almost a year on.
More woes for Dixons Carphone
The breaking of the cyber-attack and the affect it has had – and will have – on their profits and share value comes just weeks after it was announced that around 92 of their stores will be shut. They’re one of the many retailers feeling the pinch after the growth of online retailers who are devouring the high street chain’s market shares at alarming rates.
Subsidiary retailer Carphone Warehouse was fined for a data breach back in 2015, where they payed a penalty of £400,000.00 following a previous cyber-attack. Dixons Carphone shares are reportedly down 36pc since June last year.
This new cyber-attack will no doubt trigger another fine from the UK’s data watchdog, the Information Commissioner’s Office (ICO), although it’s thought that Dixons Carphone will dodge a GDPR-style fine because the incident took place last year.
They’re already set to be investigated by the GCHQ.