SEC probes Yahoo after massive data breaches

As Yahoo continues to face repercussions of two massive security breaches that exposed information for at least 1 billion users, the internet company is reporting fourth quarter earnings that beat Wall Street’s expectations.

The fate of the deal was thrown into doubt after Yahoo disclosed two major data breaches a year ago.

Yahoo said non-GAAP earnings rose to 25 cents per share from 13 cents in the year-earlier period, with revenue climbing 15% to $1.47 billion.

These red flags relate to the 2014 breach, which saw hackers compromise more than 500,000 accounts, gaining access to consumers’ personal information such as email addresses and birth dates, and answers to password-related security questions.

Yahoo is reportedly under investigation by the United States financial watchdog over whether the company took too long to notify investors of two massive data breaches involving the details of 1.5 billion users.

Last July, Verizon announced it would buy Yahoo!’s core businesses and both data breaches were not disclosed until after the sale.

“I’m very pleased with our Q4 results and incredibly proud of the team’s execution on our 2016 strategic plan, particularly given the uniquely eventful past year for Yahoo”, Mayer said in a statement. Meanwhile, the disclosure of the hacks has delayed Yahoo’s planned sale to Verizon.

In the fourth quarter of 2016, the company reported revenue of $1.47 billion, up from $1.27 billion in fourth-quarter 2015.

The SEC has previously investigated several large data breaches, including the one at Target, but has not yet taken public action, Newman said: “The Commission has never brought an enforcement action based on a company’s failure to disclose a cyberattack”. These include the US Securities and Exchange Commission (SEC), the Federal Trade Commission and the US attorney’s office in Manhattan. In September, Mark Warner, the Democratic senator, required the SEC to analyze the situation, revealing whether Yahoo and its executives managed to accomplish their duties to publish data about the hack from 2014. At one point, after the second hack was announced, Verizon was reportedly considering exiting the deal but, according to Sunday night’s WSJ report, Verizon says the deal is still in place.