- FireEye announced last week plans to layoff between 300-400 of the company’s 3,400 employees as slower demand lowered quarterly sales below forecasts.
- The layoffs are expected to reduce the security company's annual costs by about $80 million.
- Chief Executive Kevin Mandia said a shifting security landscape is resulting in less profitable work. The company's shares have fallen more than 62% in the last year.
Chief Financial Officer Michael Berry told Reuters he plans to restructure and streamline the company’s operations.
Revenue from FireEye’s Mandiant forensics unit, which helps enterprises respond to cyberattacks, climbed just 2% in the second quarter, a dramatic drop from the 40% increase it saw in the first quarter. Mandia said the dramatic rise in ransomware means enterprises are seeing fewer large, state-sponsored types of attacks. While company’s work on ransomware attacks rose, that type of work is less complex and therefore less profitable.
"The size and scope have changed," Mandia told Reuters. "The whole remediation was more complex" when the company was responding to large numbers of state-sponsored hacks from China, he said.
China and the U.S. agreed to new cybercrime rules last September, and it appears to have made a difference.