This is the first time cybersecurity issues have been cited as the reason for a downgrade.
"We are treating this with more significance because it is the first time that cyber has been a named factor in an outlook change," Joe Mielenhausen, a spokesperson for Moody's, told CNBC. "This is the first time the fallout from a breach has moved the needle enough to contribute to the change.
Moody's cited Equifax's recent $690 million first-quarter charge for the breach as contributing to the downgrade. The expense represents the company's estimate for settling ongoing class action cases, as well as potential federal and state regulatory fines. The note also cited Equifax's hefty cybersecurity investments as problematic for its future strength.
"We estimate Equifax's cybersecurity expenses and capital investments will total about $400 million in both 2019 and 2020 before declining to about $250 million in 2021," the note says. "Beyond 2020, infrastructure investments are likely to remain higher than they had been before the 2017 breach.
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