Type of Submission

Refereed Article


Hospitality firms are susceptible to data breaches due to the high volume of information they keep on customers and employees. In this paper, we first present an analysis of the stock market’s reaction to data breaches at hospitality firms, and we compare these breaches to a matched-firm sample of retail firm breaches. Abnormal stock market returns indicate that hotel and restaurant firm stock prices went down by approximately 1.24% from data breach announcements. We find that the type of breach or number of times a firm has been breached does not alter the impact of a breach on firm returns. Additionally, we find that data breaches cause a greater loss of value for hotel firms than for restaurants. Finally, we find no support for the idea that hospitality firms exhibit larger negative effects compared to retail firms on a matched-pair analysis.