Verizon only learned about Yahoo’s massive data breach 2 days ago
NEW YORK (CNNMoney) — Yahoo users aren’t the only ones digesting the news about the company’s massive data breach.
So is its future parent company.
Verizon said that it only learned this week that Yahoo was hit with a massive security breach. On Thursday, the news broke that “at least” 500 million user accounts had been compromised, likely making it one of the largest hacks in history.
“Within the last two days, we were notified of Yahoo’s security incident,” a spokesperson for Verizon said in a statement provided to CNNMoney. “We understand that Yahoo is conducting an active investigation of this matter, but we otherwise have limited information and understanding of the impact.”
Verizon agreed to buy Yahoo’s core properties for $4.83 billion in late July, just days after reports of a wide-scale security breach first surfaced in the media.
The mega-breach could create a headache for both companies, including damaging press, police investigations, scrutiny from regulators and user outrage.
More to the point: it could complicate a billion-dollar deal that was originally expected to close in the first quarter of 2017.
“It comes down to whether or not there is a meaningful change in use of the platform above and beyond what was happening before,” says Brian Wieser, an analyst who covers Yahoo at Pivotal Research Group.
If the news were to ignite a user exodus, that could take away Yahoo’s key selling point for Verizon: its enormous reach of more than one billion monthly users.
Robert Peck, an analyst with SunTrust, estimates the breach could shave $100 million to $200 million off the closing price of the deal, due to user attrition — but nothing that he expects to be “material” to the overall purchase price.
“Hacks are almost relatively common,” Peck says. “[AOL CEO] Tim Armstrong at Verizon was hacked yesterday on Twitter.”
Robert Varetonni, a spokesman for Verizon, declined to comment beyond the prepared statement.
“We will evaluate as the investigation continues through the lens of overall Verizon interests, including consumers, customers, shareholders and related communities,” Verizon said in the statement. “Until then, we are not in position to further comment.”
Yahoo said it believes a “state-sponsored actor” was behind the data breach, meaning an individual acting on behalf of a government. The breach is said to have occurred in late 2014 and included names, email addresses, phone numbers and birth dates.