The 2026 State of Ransomware in Retail report reveals that while ransom payments are down, attackers are successfully encrypting data at higher rates.
Sophos has released its sixth annual State of Ransomware in Retail report, detailing shifts in ransomware outcomes for the retail sector ahead of White Friday and the holiday shopping season.
Based on a survey of 217 IT and cybersecurity leaders across 17 countries, the data reveals that while retail organizations recorded the lowest ransom payments and the fastest recovery times across all sectors, data encryption rates climbed by 14 percentage points.
Key Findings from the 2026 Retail Ransomware Report
- Encryption Rates Surge: 62% of attacks on retail organizations successfully encrypted data, up from 48% in 2025 and above the 56% cross-sector average. Attacks involving both data encryption and theft rose to 19%.
- Known Vulnerabilities: Exploited vulnerabilities were the starting point for 26% of attacks. Furthermore, 38% of victims attributed their breach to a known security gap they were aware of but had not addressed, making it the most common operational root cause.
- Identity Vectors: Identity-based vectors, including phishing, compromised credentials, and malicious emails, initiated 69% of attacks on the retail sector.
- Ransom Demands vs. Payments: The median ransom demand was $225,000, though outlier attacks on high-revenue targets pushed the average demand to $4.32 million. The median ransom payment was $57,500, the lowest of any sector.
- Recovery Timelines and Costs: The average time to fully recover fell to 2.54 weeks, with 56% of organizations recovering within a week. However, the average recovery cost, excluding ransom payments, rose to $1.76 million.
Security Controls and Operational Disconnects
The report highlights a disconnect between threat detection and operational response. Almost all retail victims of credential-based attacks (97%) had multifactor authentication (MFA) enabled, yet more than half still suffered data encryption. Similarly, firewalls flagged 59% of attacks before ransomware was deployed, but data was still encrypted 60% of the time in those instances.
“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.”
Source: State of Ransomware in Retail 2026 Report.
Disclaimer: This article is based on the official announcement by Sophos and has been edited for length and readability. Data points and survey results are based on information provided by the company.
