Kaspersky lowers growth outlook due to Covid-19

The Moscow-based cybersecurity firm, which caters to more than 400 million users, predicts higher growth from its B2B business

Eugene Kaspersky, founder and chief executive of cybersecurity company Kaspersky, expects a single-digit growth this year. Courtesy Kaspersky

Cybersecurity company Kaspersky downgraded its overall growth outlook for 2020 due to the Covid-19 pandemic but predicts an uptick in sales for its business-to-business and Internet of Things software as enterprises spend more on safeguarding their systems.

"We were targeting at least 10 per cent annual growth in revenues but unfortunately it is difficult to achieve now," Eugene Kaspersky, chief executive of the company, told The National.

“We are still positive … if not double-digit, we are sure to achieve single-digit growth by the end of this year,” said Mr Kaspersky, who co-founded the company in 1997.

Kaspersky, which directed its own employees to work from home in April, reopened its offices with limited capacity on September 1.

“Being a technology company, we did not experience any disruption and easily adapted to the new normal. We helped customers to install our products remotely. We also saw a good increase in business volume,” Mr Kaspersky said.

The Moscow-based firm earned revenue of $685 million (Dh2.5 billion) last year, which was almost 6 per cent lower than the previous year. However, the company's enterprise business continued to grow by more than 10 per cent and its B2B digital sales grew 14 per cent. Prior to the pandemic, the best-performing parts of its business were those serving the financial, energy, retail and manufacturing sectors.

“We see more growth coming out of B2B and industrial sectors … especially because many businesses have moved online. There is more demand for solutions that could help enterprises to control their entire systems remotely,” he added.

The B2B business is growing on the back of new product launches, he said, such as new industrial and IoT solutions that will eliminate the need for anti-virus software.

“In IoT, it is not possible to develop or install anti-virus for thousands of connected devices. Therefore, we have designed a security system in the main architecture that technically makes it impossible to inject any unwanted code,” he said.

"Currently, the IoT and industrial sectors form a small part of our revenue pie … they are new but growing at a considerable pace,” he added.

The cybersecurity market is forecast to be worth $248.5 billion (Dh915.7bn) in 2023, almost 50 per cent more than the amount spent last year, according to research company Markets and Markets.

Kaspersky, which caters to more than 400 million users and over 250,000 corporate clients globally, earns most of its revenue from Europe, North America and Russia but the company has recorded “promising growth” in Latin America, the Middle East and Asia in the past few months, Mr Kaspersky said.

Kaspersky is stopping nearly 400,000 malicious applications a day since June. EPA

The company has 34 offices in 30 countries employing 4,000 staff, half of whom are involved in research and development.

It is working with more than 450 different partners including internet service providers, mobile operators, banks, insurance companies, financial service providers and the gaming community, and delivering B2C and B2B products on a subscription basis to their customers.

Prior to the spread of Covid-19, Kaspersky prevented 300,000 malicious attacks every day. That number has risen to 400,000 a day since June, Mr Kaspersky said.

“You can imagine how many new criminals have evolved during the Covid-19. Stopping them is no problem as we have algorithms and machine learning. But they are gaining experience and will pose a greater threat in the coming months,” he said.

“Earlier they were only targeting big banks and enterprises but now they are attacking even mid-level businesses that don’t have enough resources … with more people moving online there is a significant increase in vulnerable surface.”

Mr Kaspersky says the business is growing in every market this year. Getty

In the past, countries including the US, the UK and Lithuania had expressed suspicion over Kaspersky handling sensitive data, citing the company’s links to the Russian government.

To dispel such concerns, Kaspersky launched a 'global transparency intiative', opening data centres, or transparency centres, as it called them, in Asia, Europe and North America.

Its opened its first transparency centre in Zurich in November 2018, followed by another in Madrid. Two more are planned for Kuala Lumpur and Sao Paulo this year.

“They help us to process and reside the data closer to our customers … no data will go out of the particular region … no other cybersecurity provider has done anything as far reaching as this,” Mr Kaspersky said.