Cyber Attack May Cause Clorox Product Shortage

In mid-August 2023, the computer system of Clorox experienced a disruption caused by hackers. Clorox has since included this incident in their latest SEC filings. The temporary shift to manual order processing significantly impacted the efficiency of their manufacturing operations. However, as of one month later, they have made substantial progress in restoring their operations and are approaching full capacity once again.

The recent ransom attack didn’t solely target Clorox; Caesars Entertainment in Las Vegas also fell victim to it. This resulted in a significant disruption of their hotel services, theft of data, and difficulties in carrying out basic tasks like employee timecards and customer payments. The hotel’s owner has asserted that they incurred daily losses ranging from $4 million to $8 million for each day they operated below full capacity due to this incident.

Clorox, a publicly traded company, has disclosed in its recent financial filings with the SEC that the full extent of the impact from the cyber attack is still being assessed. While the company’s stock did experience a slight decrease recently, it has not suffered any catastrophic consequences. Clorox has demonstrated resilience and adaptability in addressing the situation.

Starting from the end of 2023, new regulations will necessitate that publicly traded companies report incidents like this to the SEC within a four-day timeframe. The SEC is vigilantly overseeing the aftermath of this cyber attack, especially considering its impact on numerous companies.

In addition to its own brand, Clorox possesses a portfolio of other brands, including Burts Bees, Pine SOL, Brita water products, Tilex, Glad trash bags, and Fresh Step kitty litter. Clorox has not yet revealed which, if any, of these products may experience delays in manufacturing. Furthermore, Clorox supplies products for commercial use in hospitals, schools, and businesses where sanitation is crucial. The disclosure of the recent incident has prompted certain consumers to proactively stock up on Clorox products that are currently available on store shelves.

Clorox has enlisted the expertise required to address this situation, and an investigation is currently in progress. While Clorox does not anticipate severe product shortages, it acknowledges that some disruptions in the supply chain are probable for the next month or thereabouts.




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