The cost of a malware attack: Nuance attributes $98M in lost revenue to NotPetya — 6 things to know

Nuance Communications, a speech and imaging software company, said it lost $98 million in revenues after it fell victim to the NotPetya malware attacks in 2017, according to the company's latest 10-Q filing with the Securities and Exchange Commission.

Here are six things to know.

1. Nuance was struck with a cyberattack June 27 that affected systems used by its healthcare companies. Outages persisted through early August.

2. An investigation revealed the NotPetya qualified as a security incident under HIPAA, but was not a breach of any protected health information, the company wrote in a July 27 letter to its customers.

3. Filings show Nuance blames the cyberattack for nearly $98 million in lost revenue.

4. "For fiscal year 2017, we estimate that we lost approximately $68.0 million in revenues, primarily in our healthcare segment, due to the service disruption and the reserves we established for customer refund credits related to the Malware Incident. Additionally, we incurred incremental costs of approximately $24.0 million for fiscal year 2017 as a result of our remediation and restoration efforts, as well as incremental amortization expenses," the filing reads.

5. Although the direct effects of the incident were remediated during its fiscal year 2017, Nuance expects it will spend even more in the upcoming year to address the lasting impacts of the attack.

6. "The malware incident had a continued effect on our results of operations in the first quarter of fiscal year 2018 including contributing to: a year-over-year decline in the annualized line run-rate in our on-demand healthcare solutions and in the estimated three-year value of on-demand contracts; a year-over-year decline in hosted revenue and an increase in restructuring and other charges. In addition, we expect to expend additional resources during fiscal year 2018 and beyond to continue to enhance and upgrade information security," the filing reads.

More articles on health IT:
Epic's population health tool adds resources from Geisinger spinoff xG Health Solutions
Health IT Now, Bipartisan Policy Center & 40+ health IT experts call to revamp ONC
Primary care physicians spend more time on EHR than face-to-face care, study suggests

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars