LinkedIn reported another strong and profitable Q2 2012 and LinkedIn CEO Jeff Weiner told investors this week at the company’s earnings call that the cost of security would effect the bottom line by upwards of $2 million to $3 million.
According to Weiner:
“In June, we reported the theft of six-and-a-half million LinkedIn member passwords that were published on an unauthorized website. Though no member login information was published, we disabled the passwords of the accounts that we deemed to be at risk. Since then, we have redoubled our efforts to ensure the safety of member accounts on LinkedIn by further improving password-strengthening measures and enhancing the security of our infrastructure and data. The health of our network, as measured by member growth and engagement, is as strong as it was prior to the incident.”
Weiner’s sentiments were echoed by LInkedIn SVP and CFO Steve Sordello who told investors the company has already spent upwards of $1 million handling the breach.
Sordello told investors:
“In taking proactive steps to update security post the June password theft, we are assuming $2 to $3 million in second half expenses –more weighted toward the third quarter.”
LinkedIn came under criticism following the breach because of its lax security which many people believed made it easy to grab user account information and share it online.