UK firms face rising cyberwarfare threats & GBP £14.2m costs

A new report from Armis indicates that UK IT leaders see a rising risk of cyberwarfare amid increasing geopolitical tensions and advances in artificial intelligence.

The research, detailed in Armis' third annual Cyberwarfare report, 'Warfare Without Borders: AI's Role in The New Age of Cyberwarfare,' found that 88% of IT decision-makers in the UK are concerned about nation-state cyber threats affecting their organisations. This represents a 32% increase in concern compared to the previous year.

Almost half, or 47%, of UK respondents report the threat of cyberwarfare as imminent, with a similar proportion stating they have had to notify authorities about such incidents. According to the report, the threat environment remains consistent for 44% of organisations, but 40% of IT professionals state that the landscape has worsened.

Beyond the perception of risk, the financial consequences are also notable. UK businesses pay an average of GBP £5.6 million in ransomware payouts, with one in eight organisations disbursing over GBP £7.9 million for a single attack. Some sectors experience even higher average costs: ransomware payouts average GBP £7.1 million in Manufacturing and GBP £14.2 million in the Transport and Logistics sector, more than doubling the national average.

Armis' Chief Technology Officer and Co-Founder, Nadir Izrael, commented on the evolving nature of these threats: "AI is enabling nation-state actors to stealthily evolve their tactics to commit acts of cyberwarfare at any given moment. At the same time, threats are emerging at overwhelming rates from smaller nations and non-state actors leveraging AI to elevate to near-peer cyber threats. Cybersecurity leaders must shift their programs left of boom, enabling them to stop cyberattacks capable of crippling their operations before there's any impact to their organisation."

The report finds that 71% of IT leaders fear nation-state actors will likely use AI to design more sophisticated and targeted cyberattacks. The National Cyber Security Centre has previously warned that AI will increase the impact of such attacks, but the report reveals a lack of preparedness on the defensive side. Only 48% of UK businesses are currently using AI-powered security tools. Moreover, 48% of those surveyed said they do not have the necessary skills to effectively deploy such solutions, while half point to budget and resource constraints as obstacles to adoption.

Andy Norton, European Cyber Risk Officer at Armis, addressed these concerns, stating: "Businesses are facing a perfect storm of nation-state attacks, AI-powered threats and crippling ransomware payments. Yet, 58% only respond to attacks as they happen or after damage is done. The cost of inaction is abundantly clear – to stay on top of evolving threats, businesses must shift to a proactive cybersecurity posture to eliminate vulnerabilities before they can be exploited."

Additional findings from the report highlight wider operational and strategic effects of cyber risks. The threat landscape has caused 68% of UK organisations to reconsider their suppliers and ramp up cybersecurity investments in response to geopolitical events. Meanwhile, 49% of IT leaders disclosed that concerns over cyberwarfare have resulted in delays or cancellations of digital transformation projects.

The report also reveals that 52% of UK IT decision-makers feel overwhelmed by the complexity of the regulatory ecosystem surrounding cybersecurity, which has strained their security teams. Despite the widespread concern over the cyberwarfare capabilities of nation-state actors, only 55% believe that the UK government is prepared to defend its citizens and enterprises from such attacks.

When asked about which nation-state actors are perceived as the most significant cyber threats, UK respondents ranked China at the top (74%), followed by Russia (71%) and North Korea (37%).

Armis' report notes that 73% of UK IT professionals believe nation-state capabilities could escalate to a full-scale cyberwar, potentially crippling critical global infrastructure. At the same time, 45% doubt the government's capacity to defend the country against such an event.

The findings are based on a study of more than 1,800 global IT decision-makers and proprietary data from Armis Labs.