Marriott Cites Growing Pains Following Data Breach, Labor Strikes
Photo Credit: An alert on the now defunct SPG app for iOS, telling members about a security breach that impacted Starwood Preferred Guest members. Skift
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Being bigger, Marriott is discovering, may not always be better in the short term. But if the company can weather a massive cyberattack and some debilitating labor strikes, the future shouldn't be nearly as challenging, executives hope.
Marriott on Friday divulged the financial impact of the massive data security breach it disclosed in late November, as well as the cost of major labor strikes that took place at a number of its hotels throughout the U.S.
The data breach, which exposed the personal information of up to 500 million individuals, cost the company, pre-tax, a total of $28 million, but those expenses were offset by insurance recoveries of approximately $25 million and did not impacted adjusted earnings, Marriott Chief Financial Officer Lenny Oberg noted during an earnings call with investors.
The security incident originated with Starwood Hotels & Resorts as far back as 2014. Marriott bought Starwood for $13.3 billion in 2016 and did not discover the breach until 2018. In January, Marriott said fewer than 383 million customer records and 25.55 million passport numbers were stolen in the attack on Starwood's reservations system.
Marriott CEO Arne Sorenson opened his remarks on the call, noting, "
