Second breach in two years
On October 12, 2017, Hyatt revealed that its payment system had been breached. There was unauthorized access detected in 41 hotels in 11 countries, exposing customer credit card information at these locations.
About 50% of these hotels were located in China. *Other affected countries and territories include Brazil, Colombia, Guam, Indonesia, India, Japan, Mexico, Puerto Rico, and South Korea. The breach occurred from March 18 to July 2.
The breach was conducted by inserting malicious software code into the hotel’s IT system. This is the second such breach to affect Hyatt in the past two years. The first breach had occurred in 2016 and had impacted almost 250 hotels in 50 countries.
Intercontinental Hotel Group (IHG) also reported two data breaches this year. Sabre, a hotel reservation group, was also affected by data breach exposing information from various hotels. This includes Trump Hotels, Four Seasons Hotels and Resorts, RLH Corporation, and Kimpton Hotels & Restaurants.
In 2016 Hilton Worldwide (HLT), Starwood Hotels & Resorts Worldwide, Trump Hotels, and Mandarin Oriental experienced hacker attacks.
How does this impact business?
The second breach within two years could impact its business in the short term. Customers and investors are now awaiting specific details on how Hyatt plans to prevent similar attacks going forward.
The management’s estimate was released before Hyatt’s credit card data breach came to light in *. *Analysts estimate have probably turned lower due to the implications of this data breach.
Investors can gain exposure to the hotel sector by investing in the PowerShares Dynamic Leisure and Entertainment Portfolio ETF (PEJ), which invests 2.8% of its portfolio in Hyatt. PEJ also invests 2.9% of its holdings in Wyndham (WYN) and 5.4% of its portfolio in Hilton (HLT). However, it has no exposure to Marriott (MAR).