Sophos, a global cybersecurity leader, released its sixth annual State of Ransomware in Retail report, revealing significant improvements in ransomware outcomes for the retail sector alongside several concerning trends. Retail organizations paid less to attackers than any other sector and recorded the fastest recovery times in the survey’s history. However, ransomware encryption rates climbed by 14 percentage points compared with last year, while the average recovery cost rose to $1.76 million.
The findings come as retailers prepare for White Friday and the holiday shopping season, when the availability of digital services and operational systems is especially critical. Ransomware can disrupt payment systems, inventory management, order fulfillment and customer service—putting revenue and customer trust at risk. While the report does not measure White Friday-specific attacks, its findings highlight security weaknesses that retailers should address before entering their busiest trading period.
The report is based on a survey of 217 IT and cybersecurity leaders at retail organizations across 17 countries that were hit by ransomware in the previous 12 months. The survey was conducted from January to March 2026.
Key findings
- Exploited vulnerabilities hit retail hardest: Exploited vulnerabilities were the starting point for 26% of attacks on retail organizations—the highest rate of any sector and well above the 18% cross-sector rate. Phishing was the leading technical root cause at 29%, followed by exploited vulnerabilities (26%) and malicious email (22%).
- Identity remains a major route in: Identity-based vectors—including malicious email, phishing, compromised credentials and brute-force attacks—initiated 69% of attacks on retail. This was the lowest rate of any sector but still accounted for more than two-thirds of attacks.
- Known security gaps were retail’s most common operational weakness: 38% of retail ransomware victims attributed their breach to a known security gap they were aware of but had not addressed, compared with 36% across all sectors. This was retail’s most common operational root cause.
- Encryption climbed after two years of decline: 62% of attacks successfully encrypted data, up from 48% in 2025 and above the 56% cross-sector rate. Attacks involving both data encryption and theft rose to 19%, from 14% last year.
- Backups played a major role in recovery: 71% of retail organizations restored data from backups, up from 62% last year and above the 66% cross-sector rate.
- Lower typical ransom demands, but a high average: The median ransom demand was $225,000—the second lowest of any sector—compared with a cross-sector median of $698,000. However, the average demand was $4.32 million, the highest of any sector, excluding outlier ransoms of $40 million or more. Higher revenue retailers were the target of some of the highest ransoms across sectors, driving the sector’s average demand up. The median ransom payment was $57,500, the lowest of any sector and well below the $769,000 cross-sector median.
- Recovery was faster, but costs increased: The average time to fully recover fell to 2.54 weeks, down from 3.16 weeks and below the 2.80-week cross-sector average. 56% of retail organizations recovered within a week—the highest share in five years of retail data. However, the average recovery cost, excluding any ransom paid, rose to $1.76 million from $1.65 million, slightly above the $1.70 million cross-sector average.
Defenses detected attacks—but did not always stop them
Almost all retail victims of credential-based attacks had multifactor authentication (MFA) enabled (97%), yet more than half still had data encrypted by attackers. Firewalls flagged 59% of attacks before ransomware was deployed, but even when these early indicators were present, victims’ data was encrypted 60% of the time, compared with 50% across all sectors.
The findings suggest that retailers’ security controls are detecting important signals, but those signals are not consistently translating into coordinated action. In a high-pressure trading period such as White Friday, delays in identifying and containing an attack can have significant operational consequences.
“Retailers have made real progress: they are paying attackers less and recovering faster than ever before. But with encryption rates up 14 % and known security gaps still behind 38% of attacks, there is no room for complacency as the White Friday season approaches,” said Fayez Eweidat, VP Sales Emerging (META) at Sophos. “Retailers’ controls are picking up the right signals, but they need to work together. By closing known gaps and connecting identity, email, endpoint and network defenses so they respond as one, retailers can stop attacks before they disrupt their busiest trading period.”
Recommendations: Prepare defenses before peak trading
The report outlines several recommendations based on this year’s findings. For retailers, closing known security gaps and ensuring existing defenses work together are among the highest-impact steps they can take.
Sophos recommends that retailers:
- Address known security gaps: Prioritize vulnerabilities and security issues that have already been identified but remain unresolved.
- Strengthen identity security: Protect accounts with MFA and robust access controls, while monitoring for compromised credentials and suspicious activity.
- Connect security controls: Ensure identity, email, endpoint and network defenses can share signals and respond together, rather than operating in isolation.
- Prepare for disruption: Test backup and recovery processes and ensure teams can respond quickly to incidents that threaten critical retail operations.
A coordinated defense approach can help retailers detect threats earlier, contain attacks more effectively and reduce the risk of ransomware disrupting business-critical services during peak trading.
Availability
The free State of Ransomware in Retail 2026 report, featuring the full findings, sector comparisons and recommendations, is available here.
