After two particularly stormy years of investigations, lawsuits, threats, and sanctions, and being blacklisted by the American government, NSO is finally feeling the heat: the spyware cyber company recently informed its employees that they are reorganizing, in which Shalev Hulio, the face most identified with the company, is retiring from his position of CEO. As part of the process, the company will also say goodbye to about 100 employees. So, why is all this happening?
The pressure takes its toll
As mentioned, the Israeli company has suffered quite a few blows in the last two years, but in a conversation, we had with a person close to the company, it was stated that the new cyber policy of the United States government is the real blow to the company. The policy of the Biden administration is to reduce marketing licenses and the use of cyber tools; at the same time, the Israeli Ministry of Defence is also sitting on the fence waiting to see where the wind blows – which casts doubt on the continued progress of the company and affects the signing of future contracts. According to unofficial information, the company hopes to end 2022 with sales of over 100 million dollars.
As part of the reorganization process, Shalev Hulio is leaving his position as CEO, all after he re-acquired control of the company together with other managers from the Francisco Partners fund in 2019. The reason, according to the sources we spoke with, lies in the fact that the company followed a path of merger, sale, or major investment to deal with the blows it took in the last two years. As part of the current move, Hulio will continue to focus on the search for that saviour, while Yaron Shohat (COO) will focus on the reorganization process and managing the company, but not officially in the position of CEO.
Our sources said that NSO updated the company's employees a little while ago and informed them that about 100 employees will be laid off as part of the streamlining process. Currently, the employees have not been updated on their status and they do not yet know who will be fired and who will continue with the company.
A big headache
NSO has gone through several difficult years that began in 2018 after headlines pooped up after its technology was allegedly used by the Saudi government in the assassination of journalist Jamal Khashoggi. To this day, NSO strongly denies the claims there is no evidence for such an allegation. But that was probably just the beginning.
Meta (back then still Facebook) announced in 2019 that it was suing NSO for developing a serious security breach (the company denied this). Google, Cisco and Microsoft joined this claim; Microsoft's president even called NSO and other spyware cyber companies "the mercenaries of the 21st century"; AWS even announced that it is disconnecting NSO from all its services in an unprecedented step, and this was a day after publishing an investigation about the alleged use of NSO's Pegasus against human rights activists and investigative journalists; At the end of last year, Apple also announced that it was suing NSO.
Of course, we cannot forget what began as the "NSO Affair "which is when the Calcalist economic newspaper published an investigation in which it claimed that the Israel Police use Pegasus without a court order, and use it against citizens, sometimes even without any suspicion. However, after the publication of the first findings from the Merri Commission report, NSO filed a defamation lawsuit against Calcalist. As part of the findings, no evidence was found that the police used Pegasus on smartphones without a court order. However, above all, the decision of the U.S. Department of Commerce to put NSO on the blacklist of companies that are against its national interests hung over the company.