Security vendor FireEye is planning to cut over 10% of its workforce as part of cost reduction efforts, following a slowdown in demand.
The firm’s chief financial officer, Michael Berry, told Reuters at the end of last week that 300-400 of its 3,400 staff would have to go as part of restructuring plans intended to save the firm around $80 million annually.
FireEye also lowered its full-year revenue forecast from $780-810 million to $716-728m – combined news which sent shares down by over 16%, according to the report.
Second quarter revenue of $175 million also missed FireEye predictions, of $178-$185m.
CEO Kevin Mandia claimed that the slowdown in demand for the firm’s services has come partly as a result of fewer complex state-sponsored cases – where forensics unit Mandiant is a high-profile industry player.
There appears to have been a drop off in economic espionage incidents from China, accompanied by an upsurge in ransomware attacks, which are relatively easy to fix, according to the report.
Back in June, FireEye claimed that Beijing had reduced its cybercrime activity, stating there’d been a “notable decline” in intrusion activity in the US and 25 other monitored countries.
Presidents Obama and Xi famously shook hands on a deal in September last year stating neither government would “conduct or knowingly support cyber-enabled theft of intellectual property.”
However, it could be that the decline is evidence of Chinese state actors hiding their tracks better.
There are, of course, still plenty of state-sponsored campaigns to investigate on behalf of clients, whether from non-Chinese countries or ones carried out for non-economic purposes.
Interestingly, the Bangladesh Bank parted company with Mandiant after it completed an initial 700 hours’ work investigating the $81m heist from the central bank in February.
Part of the reason given for not signing up to an extra 570 hours to complete the investigation was the cost – which hit around $280,000 for the initial part, according to reports.
FireEye claimed at the time that every incident the firm is hired to investigate is subject to work of a unique “pricing and duration” depending on its individual circumstances.
In a statement sent to Infosecurity, a FireEye spokesperson claimed the “size and scope of the threat landscape have changed” of late.
“The whole remediation process used to be more complex, however we are now seeing that the duration and size of each incident response engagement is reducing due to the nature of attacks. As a result, services growth at FireEye was lower than expected and this lessened new subscription and product pull-through,” they added.
"As we introduce the latest versions of FireEye products, improve sales execution, and continue to optimize our costs, we will see steady improvement in our performance. We still have much work to do, but FireEye has the critical assets necessary for long term success, and that we are taking these additional steps to achieve balanced growth and profitability.”