Job cuts hit cybersecurity industry despite surging growth from ransomware attacks
Nothing has lowered Cybereason’s expectations for growth.
Nothing has lowered Cybereason’s expectations for growth. Rather, the continuing rise in ransomware attacks has forced its clients to bolster spending on security systems, putting the security software company ahead of schedule when it comes to revenue.
But Cybereason is cutting costs anyway, confirming last week that it’s laying off 10 percent of its workforce, or about 100 employees. The reductions follow the dramatic swing in the economy this year and the beating that software stocks have taken on the public market.
Cybereason’s story resonates with many of the 450-plus vendors in attendance at RSA, the premier conference for companies in security software. The size, scale, complexity and potential damage caused by cyberattacks means that no matter how corporate IT and finance departments are responding to inflation and a potential economic slowdown, budgets are expanding when it comes to protecting data and networks.
The global cybersecurity market is expected to grow at an annual rate of 9.5 percent a year, reaching almost $375 billion a year by 2028, according to Vantage Market Research. That’s about double the rate of growth forecast for overall IT spending, at least over the next two years, according to Gartner.
Still, with the IPO window closed, Cybereason’s plans for its next financing round were thwarted. Private capital could have been an option but likely with painful terms and an almost certain markdown from the company’s $3 billion valuation achieved in a funding round last year. CEO Lior Div opted instead to reduce expenses and preserve cash.