IT services giant Cognizant Technology Solutions Corp. (NASDAQ: CTSH) reported that while the Maze ransomware attack announced in April has since been contained, it expects the impact of the attack to affect revenue and corresponding margin by between $50 million and $70 million in the second quarter, according to a conference call with analysts last week.
“While we anticipate that the revenue impact related to this issue will be largely resolved by the middle of the quarter, we do anticipate the revenue and corresponding margin impact to be in the range of $50 million to $70 million for the quarter,” CFO Karen Anne McLoughlin said in the call. “Additionally, we expect to incur certain legal, consulting, and other costs associated with the investigation, service restoration, and remediation of the breach.”
The impact could negatively affect financial results beyond the second quarter, McLoughlin noted.
Cognizant CEO Brian Humphries noted during the call that ransomware attacks are becoming all too frequent.
“We’re using this experience as an opportunity to refresh and strengthen our approach to security,” Humphries said. “We’re already applying what we’ve learned to further harden and strengthen our security environments, and we are further leveraging our external security experts to help inform and guide our long term security strategy.”