Clorox, a leading U.S. manufacturer of cleaning products, announced that it expects to report a first-quarter loss due to a cyberattack in August that resulted in product outages and disrupted operations and supplies.
The cyberattack impacted parts of Clorox’s IT infrastructure, compelling the company to temporarily shut down certain systems and resort to manual order processing. The incident has prompted ongoing operational challenges, albeit improving, which the company expects to continue into the second quarter as it strives to return to normalized operations.
In addition to the current quarter, Clorox is also assessing the potential impact the cyberattack might have on its financial performance for fiscal year 2024 and beyond.
The company expects to report a loss per share ranging from 35 cents to 75 cents for the quarter ending on September 30. Net sales are anticipated to decline by 23 percent to 28 percent compared to the same period last year. In the corresponding quarter the previous year, Clorox had reported a profit of 68 cents per share. The cyberattack’s impact has led to a reversal in Clorox’s expectations for first-quarter gross margins, which were initially projected to increase.
Clorox has informed law enforcement agencies about the cyberattack, but no further comments were provided regarding the ongoing investigation. The FBI, meanwhile, has confirmed investigations into similar incidents involving MGM and Caesars but declined to comment specifically on Clorox.
The company’s shares experienced a 2 percent decline in extended trading after the release of the outlook, underscoring the financial impact of the cybersecurity breach. Clorox stated that the adverse effects of the cyberattack outweighed the benefits derived from pricing strategies, cost savings, and supply chain optimization.
