The Western Digital cybersecurity breach that allowed an outside actor to gain access to its computer systems should be considered credit negative for the company, according to a Moody’s Investors Service analyst.
Moody’s in February warned that Western Digital faced increasing pressure from intense competition, pricing pressures and reduced IT spending related to economic headwinds. However, a Moody’s spokesperson said this new statement should not be considered a formal ratings downgrade.
An outside actor accessed the data storage company’s computer systems and obtained data, Western Digital said Monday. The company is is still trying to figure out the nature and scope of the data exfiltration.
Western Digital also disclosed the incident in a filing with the Securities and Exchange Commission. A Western Digital spokesperson said the company would not have any additional comments beyond the disclosure.
Western Digital customers complained on social media about not being able to access the My Cloud service, and the company’s status page said the service is offline.
Raj Joshi, senior vice president at Moody’s, said the incident could exacerbate larger concerns about the company.
“The cybersecurity incident could interrupt the company’s operations while its credit profile is under pressure amid a deep industry downturn,” Joshi said in a statement Monday.
The recent incidents at MKS Instruments, T-Mobile and Uber Technologies highlight the vulnerability of technology and telecom companies to cyber risk, Joshi said. They also raise larger concerns about cyber governance practices.