Israel’s NSO Fires 100 Workers, CEO to Step Down

NSO Group, maker of the infamous Pegasus spyware, is laying off more than 10 percent of its workers, while CEO Shalev Hulio will step down and focus on finding a buyer for the company

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A cellphone in front of the NSO Group logo.
A cellphone in front of the NSO Group logo.Credit: Ohad Zwigenberg

NSO Group, the Israeli offensive cyber firm known for its infamous Pegasus spyware, is laying off about 100 workers and replacing its CEO, a company spokesperson confirmed..

CEO Shalev Hulio, one of NSO's three co-founders, is stepping down from his position and will now focus on finding a buyer for the firm after a deal to sell it to the American defense contractor L3Harris fell through, due to opposition from both American and Israeli officials. Yaron Shohat, who was chief operating officer, will take Hulio's place.

NSO said that it would also be letting go of about 100 of its 750 workers – about 13 percent of its staff.

The cyber firm claims that it expects to finish this year with a revenue of $150 million, but it has been in dire financial straits since the U.S. Department of commerce blacklisted it last November, after it came to light that some African states used Pegasus software to spy on U.S. State Department officials in Africa.

This was preceded by Project Pegasus, an investigative journalist consortium led by Paris-based NGO Forbidden Stories and including Haaretz, which published a string of reports alleging misuse of the Pegasus spyware by regimes across the world.

After the publication of the Pegasus Project's research, the defense export oversight department of the Defense Ministry drastically reduced the list of states to which companies like NSO can market their products. A number of Israeli cyber firms – among them smaller NSO competitors like Nemesis – began to close down after the oversight department refused to approve their new deals in the East and in Africa.

Attempts by NSO to be removed from the U.S. blacklist have thus far been unsuccessful. A few months ago, the company began to move ahead in a deal to sell NSO to a U.S. security corporation, which would make it into an American entity and allow it to be removed from the list. The deal with defense contractor L3Harris, which was supported by some members of the U.S. intelligence community, fell through because of opposition from both Israel and Washington.

In the months since the attempted sale, NSO has still been trying to advance the deal in a bid to save its operations. Senior figures in the industry warn that if Israel does not allow new deals to go through, more companies will close their doors, more employees will be let go and, they claim, Israel will cease to be a major force in the cyber offensive market.

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