McAfee has cut roughly 200 employees or 4 percent of its workforce as the cybersecurity company struggles to compete in a market that's now appears saturated with startups and next-generation rivals -- just as overall industry growth may be slowing.
The 2019 McAfee layoffs, first reported by The Information, follow targeted McAfee layoffs in both 2018 and 2017. McAfee's majority owner, TPG, seems focused on margins, the report said.
McAfee has massive installed base -- protecting more than 500 million customers worldwide. But next-generation security providers like Cylance, Crowdstrike, Cybereason, Carbon Black and others have been chipping away at entrenched market products. Plus, Webroot has deep relationships with MSPs that serve SMB customers. And upstarts like VIPRE Security have been building successful MSP partner programs -- an area where McAfee and rival Symantec have lagged over the past decade.
The result: Both McAfee and traditional rival Symantec have struggled to maintain growth, innovate and fend off competition.
Cybersecurity Market Challenges: Startup Funding, Slowing Market Growth?
Further complicating matters:
- Venture capital investments in cybersecurity firms set a record in 2018, according to Strategic Cyber Ventures.
- Sophos, another McAfee rival, last week announced a weaker-than-expected revenue forecast.
Roll all those anecdotes together, and the market appears saturated with startups just as seemingly endless growth opportunities could be cooling off.
Thoma Bravo: Buying McAfee and/or Symantec?
Amid all those variables, potential suitors could be looking to make some buys. An example: Private equity firm Thoma Bravo has been rumored to be looking to acquire McAfee and perhaps even Symantec. The PE firm already owns dozens of cybersecurity vendors.
We'll be watching for updates.
