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Posts from the ‘Zero Trust Security’ Category

$3.6 Billion in Crunchbase funding, $96 Billion in M&A, and 10 Agentic AI security startups Reshaping 2026

Palo Alto Networks spent $29 billion acquiring three companies. ServiceNow spent $11.6 billion on three more. Alphabet paid $32 billion for Wiz. The startups building agentic AI defenses raised $3.6 billion. Total MCP security funding for 17,000+ deployed servers: $40 million. Then RSAC 2026 happened.

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Top 6 cybersecurity trends from Gartner’s 2026 Security Forecast

Over 57% of employees are using personal GenAI accounts for work. A third of them admit to uploading sensitive data into tools their security teams haven’t approved. Meanwhile, agentic AI is proliferating through no-code platforms and vibe coding, creating attack surfaces most CISOs can’t see, let alone govern. And quantum computing? No longer a 10-year planning horizon. It’s a 2030 action deadline.

Gartner’s Top Trends in Cybersecurity for 2026 report, released February 5, 2026, identifies six forces reshaping how CISOs must operate. These cut across governance, AI adoption, identity, workforce, and cryptographic strategy simultaneously. None of them is incremental.

The trends report lands alongside Gartner’s updated Forecast: Information Security, Worldwide, 2023–2029, 4Q25 (G00843183, December 18, 2025) and the Forecast Analysis: Information Security, Worldwide, 2026 (G00838442, February 5, 2026), which together project global information security spending reaching $244.2 billion in 2026, up 13.3% in current U.S. dollars. I’ve tracked this forecast through multiple quarterly updates. The trajectory keeps steepening. The six trends below explain where that money is going and why.

“Cybersecurity leaders are navigating uncharted territory this year as these forces converge, testing the limits of their teams in an environment defined by constant change,” said Alex Michaels, Director Analyst at Gartner. “This demands new approaches to cyber risk management, resilience, and resource allocation.”

The spending backdrop: $244 billion and accelerating

Before getting into the six trends, context matters. Gartner’s 4Q25 forecast shows the three major security segments all growing at double-digit constant currency rates in 2026:

Source: Gartner Forecast: Information Security, Worldwide, 2023–2029, 4Q25 Update (G00843183). Constant currency rates.

Cloud security remains the fastest-growing subsegment at 28.8% growth in 2026. Nothing else comes close. The combined cloud security market (cloud security posture management, cloud access security brokers, and cloud workload protection platforms) is projected to reach $32.4 billion by 2029, with a 25% CAGR in constant currency. I’ve been watching this subsegment accelerate for three quarters straight. CSPM alone is growing at a 31.30% CAGR.

 

Cloud security spending reaches $32.4 billion by 2029. CSPM leads at 31.30% CAGR. Source: Gartner 4Q25 Forecast. (Please click on the image to expand for easier reading)

Trend 1: Agentic AI demands cybersecurity oversight

This is the trend that touches everything else on this list. Employees and developers are deploying AI agents through no-code/low-code platforms and “vibe coding” at a pace that outstrips security governance. Unmanaged AI agent proliferation. Unsecured code. Compliance violations that most security teams don’t even have visibility into yet. That’s the picture Gartner is painting.

Gartner’s recommendation is blunt: cybersecurity leaders must identify both sanctioned and unsanctioned AI agents operating within their environments, enforce access controls and data guardrails, and develop incident response playbooks specific to agent-driven threats.

“While AI agents and automation tools are becoming increasingly accessible and practical for organizations to adopt, strategic cybersecurity planning for these technologies is essential,” said Michaels. Cybersecurity leaders must work cross-functionally to manage agentic AI adoption, identifying sanctioned and unsanctioned AI agents, enforcing data access controls, and developing incident response playbooks.

The spending data backs this up. Gartner’s 4Q25 forecast projects the AI-amplified security market reaching $160 billion by 2029, up from $49 billion in 2025. Gartner is clear that this isn’t additive spending. It represents the portion of existing security products that now embed AI capabilities. But the expectation tells the story: over 75% of enterprises will use AI-amplified cybersecurity products by 2028, up from less than 25% in 2025. Vendors that don’t embed AI will lose shelf space. (For more on AI security platforms, see Gartner’s Top Strategic Technology Trends for 2026, which predicts that over 50% of enterprises will use AI security platforms to protect their AI investments by 2028.)

Trend 2: Global regulatory volatility drives cyber resilience efforts

Regulators are getting personal. Boards and executives now face direct liability for compliance failures. Not just organizational fines, but individual accountability. The penalties for inaction have moved from theoretical to career-ending. Across multiple jurisdictions simultaneously.

Gartner advises cybersecurity leaders to formalize collaboration across legal, business, and procurement teams to establish clear accountability for cyber risk. Align control frameworks to recognized standards. Address data sovereignty concerns before they become enforcement actions. The organizations doing this well are treating regulatory preparedness as a core security function, not an annual compliance checkbox.

This is where the spending data gets interesting. Gartner’s forecast shows security consulting services growing from $24.2 billion (2024) to $36.6 billion (2029), adding $12.4 billion in five years. Security professional services follow a similar trajectory: $27.3 billion to $40.8 billion, adding $13.5 billion. Organizations are buying outside expertise because they can’t build regulatory competence fast enough in-house. I’ve been covering these numbers for three quarters, and the services growth is the part of the forecast that keeps surprising me.

Infrastructure protection adds $26.4 billion between 2024 and 2029, the largest absolute growth of any subsegment. Source: Gartner 4Q25 Forecast. (Please click on the image to expand for easier reading)

Trend 3: Post-quantum computing moves into action plans

Gartner predicts advances in quantum computing will render the asymmetric cryptography that organizations rely on unsafe by 2030. Four years. That’s the window to adopt post-quantum cryptography alternatives before “harvest now, decrypt later” attacks start cashing in on data that adversaries are collecting today.

Organizations need to identify their cryptographic deployments, assess data sensitivity and lifespan, and prioritize cryptographic agility. That last phrase keeps coming up in my conversations with CISOs. The ability to swap encryption methods without re-architecting entire systems. Swapping an algorithm is one thing. Doing it across a production environment without downtime is an entirely different problem.

“Post-quantum cryptography is reshaping cybersecurity strategies by prompting organizations to identify, manage, and replace traditional encryption methods, while prioritizing cryptographic agility,” said Michaels. “By investing in these capabilities and prioritizing migration now, assets will be secured when quantum threats become a reality.

The encryption market in Gartner’s 4Q25 forecast grows from $1.04 billion in 2023 to $2.04 billion by 2029 at an 11.95% CAGR. A 2.0x increase. For what has historically been one of the slower-growing security subsegments, that’s a significant acceleration. Quantum urgency is changing the math.

Trend 4: Identity and access management adapts to AI agents

AI agents are breaking traditional IAM models. Plain and simple. Identity registration and governance, credential automation, and policy-driven authorization weren’t designed for autonomous machine actors that can initiate actions, access data, and interact with systems without human intervention. The scale problem compounds fast: when every employee can deploy dozens of AI agents, the identity surface area explodes.

Gartner recommends a targeted, risk-based approach. Invest where gaps and risks are greatest. Leverage automation where possible. The practical starting point is understanding which AI agents carry the most privilege and the least oversight. Those are your highest-risk identities right now, and most organizations haven’t inventoried them.

The identity market is already significant. Gartner’s 4Q25 forecast shows identity access management growing from $18.7 billion (2024) to $29.0 billion (2029), adding $10.3 billion in five years. That’s before the full scale of agentic AI identity requirements hits the market. IAM vendors that solve machine-actor identity at scale will capture a disproportionate share of that $10.3 billion growth.

Trend 5: AI-driven SOC solutions destabilize operational norms

AI-enabled security operations centers are enhancing alert triage and investigation workflows. The technology works. But deploying AI into a SOC doesn’t automatically reduce headcount needs. It changes the skill mix. Analysts who excelled at manual triage need different capabilities to oversee AI-driven workflows. Organizations are discovering this the hard way. That’s an organizational transformation challenge, and throwing more technology at it doesn’t help.

“To realize the full potential of AI in security operations, cybersecurity leaders must prioritize people as much as technology,” said Michaels. “Strengthening workforce capabilities, implementing human-in-the-loop frameworks into AI-supported processes and aligning adoption with clear strategic objectives will be critical to maintaining resilience as SOCs evolve.”

The talent dimension makes this harder than it already sounds. ISC2’s 2024 Cybersecurity Workforce Study, published in October 2024, documented a global workforce gap of 4.8 million professionals, a 19% year-over-year increase. The active workforce flatlined at 5.5 million (up just 0.1%). The numbers are brutal: 25% of organizations reported cybersecurity layoffs in 2024. 37% faced budget cuts. 90% report skills shortages. 58% believe the shortage puts their organization at significant risk. On the spending side, managed security services are growing at 11.1% in 2026, the fastest rate in the services segment. Organizations can’t hire fast enough, so they’re buying managed SOC capacity instead.

Trend 6: GenAI breaks traditional cybersecurity awareness tactics

Existing security awareness programs are failing. Full stop. A Gartner survey of 175 employees conducted between May and November 2025 found that 57% use personal GenAI accounts for work purposes, while 33% admit to uploading sensitive information to tools their organizations haven’t sanctioned. Those numbers should alarm every CISO reading this. A third of your workforce is actively feeding proprietary data into tools you can’t audit.

Gartner recommends shifting from general awareness training to adaptive behavioral programs that include AI-specific tasks. Generic compliance videos won’t cut it here. The organizations getting this right are making approved GenAI tools easy to access and unsanctioned tools hard to justify. Trying to ban GenAI outright just drives usage underground and costs you talent.

Strengthening governance, embedding secure practices, and establishing clear policies for authorized GenAI use will reduce exposure to privacy breaches and intellectual property loss. The governance gap on GenAI usage is, in my view, the most underestimated risk on this entire list. Every other trend has a spending line item attached to it. This one requires behavioral change, which is harder to buy.

Total market trajectory: $173.5 billion to $323.5 billion

Gartner’s year-by-year spending trajectory shows the acceleration curve these six trends are riding:

Source: Gartner Forecast: Information Security, Worldwide, 2023–2029, 4Q25 Update (G00843183, December 18, 2025). Current U.S. dollars.

 

CSPM and CASB lead all security categories with 31% and 26% CAGR through 2029. Source: Gartner 4Q25 Forecast. (Please click on the image to expand for easier reading)

What this means for CISOs

Three of the six trends (agentic AI oversight, IAM for machine actors, and GenAI awareness) are fundamentally about the same problem: autonomous AI systems operating inside enterprise environments without adequate governance. The other three (regulatory volatility, post-quantum readiness, and AI-driven SOCs) are the structural forces those governance failures will collide with. That convergence is the signal about where 2026 budgets need to go.

The organizations that will navigate this environment successfully are doing three things simultaneously:

Mapping their AI agent footprint now. If you don’t know how many AI agents are operating across your environment, sanctioned and unsanctioned, you can’t govern what you can’t see. Gartner’s 75% AI-amplified product adoption projection by 2028 means this window for establishing control is narrow.

Building cryptographic agility into their architecture. The 2030 quantum deadline means migration planning starts in 2026, not 2028. The encryption market’s 2.0x growth reflects early movers. Late movers face rip-and-replace costs that compound every quarter they wait.

Investing in people alongside AI tooling. AI-enabled SOCs work when human operators have the skills to oversee them. The ISC2 data is unambiguous: a 4.8 million professional gap growing at 19% year-over-year. Managed security services growth at 11.1% tells you where CISOs are finding capacity.

Gartner’s numbers aren’t projections anymore. They’re procurement trends already hitting finance systems. The $244.2 billion flowing into information security this year will fund agentic AI governance, quantum migration, and SOC transformation, whether your organization participates or not.

Bottom line: CISOs planning for 2027 are watching their competitors buy the tools they’ll be scrambling for in 18 months. The data says move now.

Gartner’s 4Q25 Information Security forecast shows 15 categories capturing half of all new security spending through 2029

Gartner's 4Q25 Information Security forecast shows 15 categories capturing half of all new security spending through 2029

Fifteen cybersecurity categories are growing up to three times faster than the overall market, capturing $48.7 billion in new spending by 2029.

That’s nearly half of the $98.4 billion the entire security market will add over the next four years. Cloud Security Posture Management leads the pack at 29.36% CAGR. Cloud Access Security Brokers follow at 24.81%.

Enterprises are fundamentally restructuring their security budgets, and the driver is brutal in its simplicity. Organizations now manage an average of 112 SaaS applications across multiple cloud providers. 82% of misconfigurations are caused by human error, according to Exabeam’s analysis. And Gartner estimates 99% of cloud security failures through 2025 will be the customer’s fault, primarily from these misconfigurations. Manual oversight breaks under this kind of scale. Enterprises are responding by investing in automation that manages what people can’t across hundreds of cloud accounts, thousands of APIs, and millions of attack vectors.

Gartner’s 4Q25 update delivers the clearest signal yet about where enterprise security budgets are heading. The overall information security market grows from $213.5 billion in 2025 to $311.9 billion by 2029 at 10.03% CAGR. These fifteen high-growth categories are expanding at 10.30% to 29.36% CAGR, capturing investment dollars at rates that dwarf legacy security spending patterns.

What makes these categories different

Every high-growth category eliminates manual bottlenecks that break under cloud-native workloads. CSPM scans configurations continuously. CASB provides visibility into unauthorized SaaS usage. ZTNA verifies every connection rather than trusting the network location. With 79% of organizations using multiple cloud providers, according to Spacelift’s research, manual processes create mathematical impossibilities.

These technologies prevent problems rather than clean up after them. CSPM catches misconfigurations before breaches. ZTNA eliminates the attack surface that VPNs create. Tokenization protects data even when systems get compromised. Security teams are finally getting ahead of threats instead of constantly playing catch-up.

And the ROI is quantifiable. IBM’s 2025 Cost of a Data Breach Report shows organizations using AI and automation extensively save $1.9 million per breach and reduce breach lifecycles by 80 days. U.S. breach costs average $10.22 million. These investments pay for themselves with a single prevented incident—a calculation CFOs understand.

Gartner's 4Q25 Information Security forecast shows 15 categories capturing half of all new security spending through 2029

The 15 categories reshaping enterprise security

1. Cloud Security Posture Management (CSPM) — 29.36% CAGR — $4.68B → $12.76B

CSPM platforms scan infrastructure continuously across AWS, Azure, and Google Cloud, automatically remediating misconfigurations before they become breaches. The 82% human error rate isn’t going to improve through training. Organizations managing 100+ cloud accounts need automation. CSPM adds $8.09 billion in new spending by 2029, the single largest dollar contribution among high-growth segments.

2. Cloud Access Security Brokers (CASB) — 24.81% CAGR — $2.30B → $5.58B

Here’s the brutal reality. Enterprises average 112 SaaS applications, but shadow IT accounts for 42% of all applications per JumpCloud’s data. IT stays blind to roughly 78 apps out of an average 187-app environment. The damage? 65% of shadow IT deployments result in data loss, and 52% lead to breaches, according to Mimecast research. CASBs restore visibility and control, growing to $5.58 billion by 2029.

3. Zero Trust Network Access (ZTNA) — 21.95% CAGR — $2.48B → $5.43B

ZTNA replaces the VPN model with application-specific access controls. Instead of network-level access, it provides application-specific connections verified for every request. Gartner predicts 70% of new remote access deployments will use ZTNA by 2025, up from less than 10% at the end of 2021. And 65% of companies plan to retire VPNs within one year per Cybersecurity Insiders data. This represents a wholesale rethinking of secure access. The perimeter-based model is dying. Good riddance.

4. Threat Intelligence — 21.73% CAGR — $2.58B → $5.69B

Modern threat intelligence platforms fuse telemetry from open-source intelligence, dark-web monitoring, vendor feeds, and internal logs. Machine learning prioritizes indicators based on organizational relevance. IBM data shows organizations integrating threat intelligence reduce detection and escalation costs while cutting incidents by 30%. The market reaches $5.69 billion by 2029 as enterprises shift from passive threat feeds to automated response integration.

5. Cloud Workload Protection Platforms (CWPP) — 21.53% CAGR — $5.98B → $13.11B

Traditional endpoint security can’t protect containers that spin up and vanish in seconds. Serverless functions executing for milliseconds? Legacy tools weren’t designed for that. CWPP solutions instrument workloads directly at the kernel or hypervisor level, monitoring system calls, file access, and network connections in real-time. The 21.53% CAGR reflects the rapid shift toward microservices and Kubernetes. As workloads migrate into container clusters, protecting them becomes a survival-level priority.

6. Consent and Preference Management — 20.22% CAGR — $0.81B → $1.64B

GDPR fines surpassed €5.88 billion by January 2025, according to DLA Piper’s annual survey. California’s CCPA penalties keep climbing. The California Privacy Protection Agency recently fined Todd Snyder $345,178 for inadequate opt-out and privacy request processes. Manual consent workflows can’t meet regulatory deadlines across jurisdictions. Automated platforms centralize preferences across web, mobile, and API endpoints while providing auditable logs for regulators.

7. Subject Rights Request (SRR) Automation — 14.26% CAGR — $1.24B → $2.01B

When users demand “delete my data,” these platforms automate orchestration across internal systems and third-party vendors. Privacy laws grant individuals rights to access, correct, and delete personal data with strict compliance timelines. SRR automation prevents the penalties that result from manual processing failures at scale, especially as more jurisdictions implement data privacy regulations.

8. Network Detection and Response (NDR) — 13.44% CAGR — $2.15B → $3.37B

NDR platforms establish behavioral baselines using statistical analysis and machine learning. When anomalies appear (unusual lateral movement, data exfiltration attempts, command-and-control traffic), they raise alerts or automatically isolate systems. The mindset shift matters here. Rather than hoping to prevent all attacks, sophisticated organizations invest in rapid detection that minimizes damage when attackers inevitably breach perimeters. Prevention alone isn’t sufficient anymore.

9. Vulnerability Assessment — 13.02% CAGR — $3.48B → $5.60B

Quarterly vulnerability scans are obsolete in CI/CD pipelines deploying multiple times daily. Modern assessment platforms provide continuous scanning integrated with exploit intelligence to prioritize patches based on real-world risk. DevOps teams need vulnerability detection that keeps pace with their deployment cadence. Anything less creates unacceptable exposure windows.

10. Tokenization — 12.68% CAGR — $1.34B → $2.11B

Tokenization replaces sensitive data with non-reversible tokens that can’t be mathematically decoded. The urgency comes from quantum computing advances. NIST finalized post-quantum encryption standards in August 2024, including ML-KEM (formerly CRYSTALS-Kyber) and ML-DSA (formerly CRYSTALS-Dilithium). Attackers already practice “harvest now, decrypt later”—collecting encrypted data today for quantum decryption within five to ten years. Organizations must begin quantum-safe transitions now.

11. Endpoint Protection Platform (EPP) — 12.51% CAGR — $17.68B → $28.36B

The largest single category adds $10.68 billion in new spending as ransomware attacks surge. U.S. ransomware attacks increased 149% year-over-year—from 152 incidents in early 2024 to 378 in the same period of 2025, according to Cyble analysis. Next-generation EPP platforms use behavioral analytics and signatureless detection to stop ransomware before encryption begins, catching what traditional antivirus misses.

12. Secure Web Gateway (SWG) — 11.63% CAGR — $4.44B → $6.74B

Malicious sites appear and disappear in hours. Cloud-delivered SWGs update threat intelligence in real-time, protecting remote and hybrid workforces wherever they connect. Integration with ZTNA creates comprehensive security that follows users across devices and locations without relying on network perimeters that no longer exist.

13. Web Application Firewalls (WAF) — 10.92% CAGR — $2.48B → $3.74B

Organizations expose hundreds of APIs and microservices—each a potential attack vector. Traditional network firewalls can’t inspect application-layer attacks like SQL injection, cross-site scripting, or API abuse. Modern WAFs use machine learning to differentiate legitimate user behavior from attack traffic without blocking customers. Getting that balance right is harder than it sounds.

14. Encryption — 10.64% CAGR — $1.35B → $1.98B

NIST’s standardization of quantum-resistant algorithms signals the urgency that organizations can no longer ignore. With quantum computing advances accelerating, encrypted data collected today faces decryption within a decade. Enterprises must transition to post-quantum cryptography now because full integration across complex environments takes years. This isn’t theoretical risk anymore.

15. Security Information and Event Management (SIEM) — 10.30% CAGR — $7.60B → $11.15B

AI transforms SIEM from reactive log collection to proactive threat hunting. The latest platforms embed unsupervised machine learning to detect zero-day attacks and automatically enrich alerts with context. Organizations using AI-powered automation save $1.9 million per breach and cut incident lifecycles by 80 days—turning security operations into a competitive advantage rather than a cost center.

Why this matters

Cloud complexity has proven exponential. With 79% of organizations using multiple cloud providers and managing hundreds of accounts, manual security processes break under the load. The 29.36% CAGR for CSPM isn’t market optimism. It’s organizational survival.

Shadow AI joins shadow IT as a core threatscape element. Shadow AI breaches cost $4.63 million—$670,000 more than standard incidents, according to IBM data. But AI also powers the best defenses, with automated security tools reducing breach lifecycles by 80 days. The same technology that creates vulnerabilities offers the most effective countermeasures.

Compliance costs keep accelerating. Between GDPR, CCPA, and emerging global regulations, manual compliance processes create escalating liability. Automated platforms turn regulatory requirements into competitive advantages by reducing fine exposure and accelerating data subject request responses.

Bottom Line

The organizations winning this transformation aren’t those with the largest security budgets. They’re the ones investing in the right categories at the right time. These fifteen segments define what modern security architecture looks like and capture nearly half of all new security spending through 2029.

Gartner’s 4Q25 data delivers a clear message. Security spending is shifting to automation-driven, zero-trust, cloud-native architectures. Organizations still relying on legacy approaches aren’t just falling behind. They’re accepting risks the market has already priced as unacceptable.

Source: Gartner Forecast: Information Security, Worldwide, 2023-2029, 4Q25 Update (Document G00843183, published December 18, 2025), showing overall market growth from $213.5B (2025) to $311.9B (2029) at 10.03% CAGR in constant currency.

 

 

AI Security market 2025 funding data, top startups, and the ServiceNow factor

ServiceNow dropped $11.6 billion on security acquisitions in 2025 alone. Armis for $7.75 billion. Moveworks for $2.85 billion. Veza for roughly $1 billion. In 2025, just one company, ServiceNow, spent more on acquiring security startups than 175 startups raised in two years. Meanwhile, the entire AI security startup ecosystem raised $8.5 billion across 175 companies over 24 months. That single data point should reshape how security leaders think about vendor consolidation and how AI builders think about their exit paths.

I analyzed Crunchbase data covering every AI security startup that raised Series A, B, or C funding between January 2024 and December 2025. The patterns are striking.

The acceleration is real

Q1 2024: $274 million across 8 deals. Q4 2025: $2.17 billion across 28 deals. That’s 8x growth in quarterly funding over two years.

The full-year numbers tell the story more clearly. 2024 saw $2.16 billion in total funding. 2025 hit $6.34 billion, nearly tripling. Average deal sizes jumped from $34 million to $54 million. This isn’t a gentle upward trend. The market is restructuring in real time.

Where the money flows

Network and Zero Trust infrastructure captured $1.9 billion across 44 companies. Tailscale‘s $161 million Series C reflects what enterprises already know. VPN architectures are dying. Identity-based access is replacing them.

Threat Detection and SOC automation drew $1.2 billion across 28 companies. 7AI‘s $130 million Series A stands out as one of the largest A funding rounds in this category. The bet: AI agents can handle the full security operations lifecycle at a scale human analysts cannot match.

Identity and Access Management pulled $990 million. But here’s what matters: that money went to just 6 companies. Saviynt‘s $700 million Series B dominates the category. When one company captures 71% of a category’s funding at Series B, investors see platform consolidation ahead. ServiceNow’s Veza acquisition, three weeks later, validated that thesis.

Insights into deal sizes

Median tells a different story from average deal sizes. Series A median: $20 million. Series A average: $28 million. The gap widens at later stages. Series C median: $85 million. Series C average: $119 million.

Translation: mega-deals skew the data significantly. Eighteen companies raised $100 million or more. Those 18 deals represent 10% of companies but 40% of total funding. For every Saviynt raising $700 million, dozens of startups are raising $15-25 million Series A rounds.

The AI/LLM security gap

Only 13 companies focus specifically on securing AI systems, LLMs, and agentic applications. Total funding: $414 million. That’s less than 5% of the $8.5 billion total. For context: ServiceNow paid more for Veza alone than the entire AI/LLM security category raised in two years.

The players building in this space:

Noma Security ($100M, Series B). Unified AI and agent security platform.

Credo AI ($21M, Series B). AI governance and compliance automation.

Lakera ($20M, Series A). Real-time GenAI security against LLM vulnerabilities.

Prompt Security ($18M, Series A). Enterprise generative AI adoption platform.

GetReal Security ($17.5M, Series A). Deepfake and AI-generated impersonation defense.

Jericho Security ($15M, Series A). Training against generative AI-powered attacks.

Enterprises are deploying AI systems at unprecedented rates. Shadow AI breaches cost $4.63 million per incident. That’s $670,000 more than standard breaches, according to IBM’s 2025 Cost of a Data Breach Report. Model Context Protocol vulnerabilities. Prompt injection attacks. Data exfiltration through AI assistants. The attack surface expands while protection lags.

Either these 13 companies scale rapidly, established players acquire their way into the space, or CISOs face a protection gap without commercial solutions.

How spending breaks out geographically

The U.S. captured $6.1 billion across 119 companies. That’s 71% of total funding. Israel remains the second hub: 15 companies, $738 million. Germany, the UK, and Canada trail with single-digit percentages.

Within the U.S., California dominates: $2.7 billion across 62 companies. That’s more than all non-U.S. markets combined ($2.4 billion). Texas ($865M), New York ($667M), and Colorado ($295M) round out the top states.

The concentration creates vendor risk. Regulatory fragmentation between the U.S. and EU markets. Geopolitical tensions affecting Israeli companies. Single-region dependency in security infrastructure. These are fundamental considerations for enterprise security architects.

ServiceNow’s acquisitions signal large-scale consolidation

ServiceNow’s 2025 acquisition spree warrants its own analysis. Armis brings cyber-physical security and OT/IoT visibility. Moveworks adds agentic AI capabilities. Veza delivers identity security for the AI era. The company calls it an “AI control tower.” A unified security stack that sees, decides, and acts across the entire technology footprint.

The driver: ServiceNow’s Security and Risk business crossed $1 billion in annual contract value in Q3 2025. They expect Armis alone to triple their market opportunity. When a platform vendor invests $11.6 billion in its own security workflows, point solutions become acquisition targets or competitors.

What this means for 2026

For security leaders: Map your vendor portfolio against both funding momentum and M&A activity. Startups with strong backing will survive consolidation. Others won’t. Audit your AI deployment pipeline against available protections. The gap between AI adoption and AI security is widening. Accelerate zero-trust adoption while solutions mature.

For AI builders: Security isn’t a feature to add later. The $414 million flowing into AI/LLM security represents smart money recognizing that unprotected AI systems are enterprise liabilities. Build with guardrails or build vulnerabilities.

Analysis based on Crunchbase data covering 175 AI security startups that raised Series A, B, or C funding between January 2024 and December 2025. ServiceNow acquisition data from the company’s press releases dated December 2025.

15 fastest-growing security categories in Gartner’s 3Q25 Information Security Forecast

15 fastest-growing security categories in Gartner's 3Q25 Information Security Forecast

Cloud Security Posture Management is growing at a 31.23% CAGR. Zero Trust Network Access at 23.25%. Threat Intelligence at 22.17%. The overall security market? Just 10.55%. Fifteen categories are outpacing the market by two to three times, collectively capturing $106 billion in new spending by 2029. Enterprise security budgets aren’t just expanding. They’re being redirected.

And the driver? Brutally simple.

Gartner estimates 99% of cloud security failures through 2025 will be the customer’s fault, primarily due to misconfigurations. Organizations are responding by investing aggressively in technologies that automate what humans simply can’t manage manually across hundreds of cloud accounts, thousands of APIs, and millions of potential attack vectors.

What these growth rates say about Gartner’s view of the market 

These fifteen categories represent $106.4 billion in new spending by 2029, growing from today’s baseline. What do they have in common? Three characteristics that explain why enterprises are pouring money into them:

  • Automation at Scale. Every high-growth category automates processes that break when done manually, whether it’s scanning cloud configurations, managing consent across jurisdictions, or detecting behavioral anomalies in network traffic. There’s no other way to keep pace.
  • Proactive vs. Reactive. These technologies prevent problems rather than clean up after them. CSPM catches misconfigurations before breaches. ZTNA eliminates the attack surface that VPNs create. Tokenization protects data even if systems are compromised. Security teams are finally getting ahead of the threat curve instead of playing catch-up.
  • Measurable ROI. IBM’s 2025 Cost of a Data Breach Report shows organizations using AI and automation extensively save $1.9 million per breach and reduce breach lifecycle by 80 days. With U.S. breach costs hitting $10.22 million, these investments pay for themselves with a single prevented incident.

15 fastest-growing security categories in Gartner's 3Q25 Information Security Forecast

The 15 categories reshaping security architecture

1. Cloud Security Posture Management (CSPM) | 31.23% CAGR | $2.5B → $13.0B

CSPM tools continuously scan infrastructure across AWS, Azure, and Google Cloud. With 82% of misconfigurations caused by human error and organizations managing 100+ cloud accounts, CSPM automates what’s mathematically impossible to do manually. The market will reach $15.6 billion by 2032.

2. Cloud Access Security Brokers (CASB) | 25.82% CAGR | $1.5B → $5.8B

Here’s a reality check. Enterprises average 112 SaaS applications, but shadow IT, or unauthorized apps, accounts for 42% of all applications. IT remains unaware of one-third of the apps on its networks. The damage? 65% of shadow IT companies suffer data loss, and 52% experience breaches. CASBs transform this chaos into visibility and control.

3. Zero Trust Network Access (ZTNA) | 23.25% CAGR | $1.6B → $5.6B

ZTNA kills the VPN model. Instead of network access, it provides application-specific connections verified for every request. Gartner predicts 70% of new remote access deployments will use ZTNA by 2025. With 65% of companies planning to replace VPNs, this shift represents a wholesale rethinking of secure access. The perimeter-based model is dying. Good riddance.

4. Cloud Workload Protection Platforms (CWPP) | 22.78% CAGR | $3.9B → $13.5B

CWPP platforms secure everything from traditional VMs to containers that exist for milliseconds. Legacy endpoint security can’t protect ephemeral containers or serverless functions—it wasn’t designed for workloads that appear and disappear in seconds. The shift to microservices demands purpose-built security.

5. Consent and Preference Management | 22.39% CAGR | $0.5B → $1.7B

GDPR fines reached €5.88 billion by January 2025, according to the DLA Piper GDPR Fines and Data Breach Survey. California’s CCPA penalties continue climbing; the California Privacy Protection Agency fined Todd Snyder $345,178 for inadequate opt-out and privacy request processes. Manual handling can’t meet regulatory deadlines. Automation prevents massive fines.

6. Threat Intelligence | 22.17% CAGR | $1.8B → $5.8B

IBM data shows threat intelligence reduces detection and escalation costs by $1.63 million while cutting incidents by 30%. Modern platforms aggregate data about bad actors and vulnerabilities, transforming raw threat data into automated responses across security stacks. The days of threat feeds sitting in dashboards, unused, are over.

7. Subject Rights Request Automation | 16.53% CAGR | $0.8B → $2.1B

When users demand “delete my data,” these platforms automate the process across all systems. Manual handling doesn’t scale, not when you’re managing requests across multiple jurisdictions with different requirements and tight deadlines.

8. Tokenization | 14.26% CAGR | $1.0B → $2.2B

Tokenization replaces sensitive data with meaningless tokens that can’t be mathematically reversed. Why the urgency now? NIST standardized quantum-resistant algorithms, including ML-KEM (formerly CRYSTALS-Kyber), in August 2024. Organizations are preparing for quantum threats expected within five to ten years.

9. Network Detection and Response (NDR) | 14.05% CAGR | $1.6B → $3.5B

NDR platforms use AI to establish behavioral baselines and detect anomalies signaling compromise. Here’s the mindset shift: rather than hoping to prevent all attacks, innovative organizations invest in rapid detection that minimizes damage when sophisticated attackers inevitably get through. Prevention isn’t enough anymore.

10. Vulnerability Assessment | 13.98% CAGR | $2.6B → $5.7B

Cloud infrastructure changes constantly. Quarterly scans are obsolete before they finish. Modern platforms provide continuous scanning in CI/CD pipelines, prioritizing based on real-world exploit data. DevOps teams deploying daily need vulnerability detection that keeps pace. Anything less is theater.

11. Endpoint Protection Platform (EPP) | 13.61% CAGR | $13.5B → $29.1B

The largest category doubles to $29.1 billion as ransomware attacks surge. According to Cyble analysis cited by TechTarget, U.S. ransomware attacks increased by 149% year-over-year in the first five weeks of 2025. Manufacturing led targets with 638 attacks in 2023, per Statista data compiled by Fortinet. Next-gen EPP uses behavioral analytics to stop ransomware before encryption begins—catching what traditional antivirus misses.

12. Secure Web Gateway (SWG) | 13.26% CAGR | $3.3B → $7.0B

Malicious sites appear and disappear in hours. Cloud-delivered SWGs update threat intelligence in real-time, protecting remote workers wherever they connect. Integration with ZTNA creates comprehensive security that follows users across devices and locations. The old perimeter? It no longer exists.

13. Web Application Firewalls (WAF) | 11.93% CAGR | $2.0B → $3.8B

Organizations expose hundreds of APIs, each a potential attack vector. Traditional network firewalls can’t inspect application-layer attacks. Modern WAFs use machine learning to distinguish legitimate users from attackers without blocking customers. Getting that balance right is harder than it sounds.

14. Encryption | 11.90% CAGR | $1.0B → $2.0B

NIST’s standardization of quantum-resistant algorithms signals urgency. Attackers already practice “harvest now, decrypt later”—collecting encrypted data for future quantum decryption. Organizations must transition to post-quantum cryptography now, as full integration takes years. This isn’t theoretical risk anymore.

15. Security Information and Event Management (SIEM) | 11.74% CAGR | $5.8B → $11.3B

AI transforms SIEM from reactive to proactive. Organizations using AI-powered automation save $1.9 million per breach, according to IBM’s newsroom. Machine learning models identify attack patterns and detect zero-day threats before signatures exist, turning security operations into a competitive advantage.

The Investment Thesis behind the numbers

These growth rates reflect three converging realities:

  • Cloud Complexity Is Exponential. With 79% of organizations using multiple cloud providers and managing hundreds of accounts, manual security is mathematically impossible. The 31.23% CAGR for CSPM isn’t optimism, it’s survival.
  • AI Changes Everything. Shadow AI breaches cost $4.63 million, $670,000 more than standard incidents. But AI also powers the defense, with automated security tools reducing breach lifecycles by 80 days. The same technology that creates vulnerabilities offers the best defense.
  • Compliance Costs Are Skyrocketing. Between GDPR, CCPA, and emerging regulations, manual compliance is a liability that grows daily. Automation platforms turn regulatory requirements into competitive advantages.

The Bottom Line

The organizations winning this race aren’t those with the most significant security budgets; they’re those investing in the right categories at the right time. These fifteen segments aren’t just growing fast; they’re defining what modern security architecture looks like.

The message from Gartner’s data is unambiguous: security spending is shifting from reactive to proactive, from manual to automated, from perimeter-based to zero-trust. Organizations still relying on legacy approaches aren’t just falling behind; they’re accepting risks that the market has already priced as unacceptable.

Source: Gartner Information Security Forecast 3Q25 Update (Document G00839334), showing overall market growth from $215.8B (2025) to $322.2B (2029) at 10.55% CAGR

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

Bottom line: Identity security stands at an unprecedented crossroads, with machine identities creating greater complexity and potential chaos every security professional needs to plan for.

At Forrester’s 2025 Security & Risk Summit, Merritt Maxim, VP and Research Director at Forrester, delivered critical insights highlighting the escalating threats shaping identity security’s evolution. CISOs and security leaders find themselves navigating surging threats driven by generative AI, the rapid proliferation of non-human identities, and outdated IAM infrastructures originally designed solely for compliance.  Maxim emphasized a pressing urgency: identity strategies must adapt or risk catastrophic breaches and compliance failures.

Here’s a detailed breakdown of the top 10 insights from Forrester’s Summit, including the specific slides from Maxim’s presentation and deeper insights from Forrester’s latest data:

1. Identity Security Budgets Accelerate Toward $27.5B by 2029

IAM investment is growing explosively, set to nearly double from $13.4 billion in 2024 to $27.5 billion by 2029, driven by the escalating complexity and severity of identity-related threats such as AI-driven deepfakes, sophisticated supply-chain attacks, and rampant cloud misconfigurations. This positions IAM as cybersecurity’s third fastest-growing segment, underscoring identity security as a business-critical imperative.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

2. Hybrid IAM Still Dominates—77% Keep On-Premise Components

Despite the relentless push to the cloud, 77% of organizations continue relying on hybrid IAM deployments due to legacy infrastructure and regulatory constraints. Fully cloud-based identity management remains a distant reality, with only 9% fully transitioned. Maxim stressed hybrid IAM’s persistence, highlighting the necessity for seamless integration capabilities between on-premises systems and cloud IAM platforms.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

3. Third-party Risk Matches Compliance as a Top IAM Driver

Forrester revealed a pivotal shift: managing third-party identities (32%) is now equally critical as regulatory compliance (32%) in driving IAM investments. High-profile breaches at Okta and CyberArk underscore vulnerabilities introduced by third-party identities, necessitating robust governance models that go beyond basic compliance checklists.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

4. Static Entitlements Are Obsolete; Zero Standing Privilege Is Now Mandatory

The static entitlement model—assigning privileges during onboarding—is officially outdated. Forrester highlighted Zero Standing Privilege (ZSP) architectures as the definitive new standard, utilizing the Continuous Access Evaluation Protocol (CAEP) to dynamically assign permissions at runtime. This strategy mitigates rampant privilege sprawl, dramatically reducing attack surfaces.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

5. Identity Management Converges Across Security, Marketing, and CX

Enterprises are rapidly integrating fragmented identity management systems across marketing, customer experience (CX), fraud prevention, and security. Maxim emphasized that businesses consolidating these functions significantly improve detection speed, minimize breaches, and enhance end-user experience. Leveraging customer preference and security data together is becoming a strategic advantage.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

6. Vendor Consolidation Radically Reshapes IAM Markets

IAM vendor consolidation accelerated significantly, highlighted by major moves such as Palo Alto Networks acquiring CyberArk, Ping Identity merging with ForgeRock, and CrowdStrike purchasing Adaptive Shield. Enterprises increasingly demand integrated identity platforms combining PAM, IGA, and Identity Threat Detection & Response (ITDR), driving these high-profile acquisitions.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

7. Generative AI Exacerbates Identity Threats but Offers Transformational Defenses

Generative AI escalates identity threats dramatically through enhanced phishing and sophisticated deepfake impersonations. Conversely, GenAI’s defensive capabilities are equally transformative, enabling automated identity threat detection, rapid response, and real-time entitlement adjustments. Maxim described these dual dynamics as essential to future IAM strategies.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

8. Machine Identities Are a Critical Emerging Attack Vector

The explosive growth in non-human identities (IoT, APIs, AI agents) vastly expands attack surfaces. Enterprises urgently need automated platforms from vendors like CyberArk, Venafi, and HashiCorp to manage this surge. Forrester highlighted machine identities as a rapidly intensifying risk requiring immediate attention and robust governance.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

9. Phishing-Resistant MFA Is Dangerously Under-Deployed

Alarmingly, only 21% of companies deploy phishing-resistant MFA after breaches, despite the increasing sophistication of MFA-bypass attacks. Forrester insists enterprises must urgently adopt solutions like FIDO2 and WebAuthn. Maxim warned that neglecting these standards leaves companies dangerously exposed to credential-based compromises.

Top 10 Identity Security Insights from Forrester’s 2025 Security & Risk Summit

10. Context-Aware IAM Becomes a Real-time Security Necessity

Static IAM fails against machine-speed threats. Context-aware IAM, powered by dynamic authorization, continuously assesses real-time user behavior, device posture, and threat intel. Forrester identifies this adaptive approach as critical, turning identity from a passive gatekeeper to a proactive defender, which is essential for stopping attacks before damage occurs

10. Context‑Aware IAM Defines the Future of Access Control Best Slide: Slide 21 – Runtime Context and Adaptive IAM Model The next generation of IAM is contextual, continuous, and AI‑assisted  Convergence, Consolidation, And… . Static permissions are being replaced with adaptive models that evaluate risk in real time — factoring in behavioral biometrics, device posture, and environmental signals. This “runtime context” turns identity from a passive gatekeeper into an active defender capable of making split‑second decisions as threats unfold.

Bottom Line: Adaptive identity security defines enterprise survival

Identity security has become synonymous with enterprise survival. Merritt Maxim’s compelling insights from Forrester’s 2025 Security & Risk Summit underscore a new identity imperative: convergence, consolidation, and context must drive strategic identity transformations. Following Forrester’s lead, enterprises must prioritize investment in dynamic Zero Standing Privilege architectures, integrated identity platforms, generative AI-enabled threat response, robust machine identity management, and phishing-resistant MFA immediately.  The future of enterprise resilience hinges directly on evolving identity security today.

Top 10 insights from Forrester’s 2026 Cybersecurity Budget Report

Top 10 Insights from Forrester’s 2026 Cybersecurity Budget Report

“With volatility now the norm, security and risk leaders need practical guidance on managing existing spending and new budgetary necessities,” states Forrester’s 2026 Budget Planning Guide.

The research firm’s planning guide for next year provides security leaders with new insights into how their clients are allocating budgets, which gives a helpful overview of the next 12 months of cybersecurity spending.

Implicit in the guide is the need for new technologies that enable organizations to be more adaptive to threats and take action on them before they become breaches. There’s also a strong focus on getting a head start on new technologies, anticipating the severity of threats new developments in AI, generative AI (genAI), deepfakes, and all other forms of weaponized technologies can pose to an organization.

Software is a solid 40% of cybersecurity spending, exceeding hardware at 15.8%, outsourcing at 15% and surpassing personnel costs at 29% by 11 percentage points. Meanwhile, security leaders face escalating threats, with generative AI attacks executing in milliseconds, a stark contrast to the average Mean Time to Identify (MTTI) of 181 days, according to IBM’s latest Cost of a Data Breach Report.

A fast-changing threatscape is changing spending priorities

Three converging threats are flipping cybersecurity on its head. What once protected organizations is now working against them. Generative AI (gen AI) is enabling attackers to craft 10,000 personalized phishing emails per minute using scraped LinkedIn profiles and corporate communications. NIST’s 2030 quantum deadline threatens retroactive decryption of $425 billion in currently protected data. Deepfake fraud that surged 3,000% in 2024 now bypasses biometric authentication in 97% of attempts, forcing security leaders to reimagine defensive architectures fundamentally.

Top ten insights from Forrester’s 2026 cybersecurity budget benchmarks

1.     Software now claims 40% of cybersecurity budgets, surpassing personnel spend. Forrester’s budget planning guide reports that software now accounts for approximately 40.2% of cybersecurity spending, eclipsing combined hardware and outsourcing budgets. It’s noteworthy that software spending is surpassing personnel costs by 11 percentage points.

Top 10 insights from Forrester’s 2026 Cybersecurity Budget Report
Source: Forrester Budget Planning Guide 2026: Security and Risk

2. Security budgets are accelerating, with 55% of global security and tech leaders forecasting significant increases next year. A robust 15% anticipate their budgets jumping more than 10%, and another 40% project hikes between 5% and 10%. Regional outlooks vary sharply: APAC is most bullish, with 22% expecting double-digit growth, compared to a cautious 9% in North America and just 12% in EMEA. However, nearly half (45%) remain reserved; 30% predict minimal budget bumps of 1%–4% or barely keeping pace with inflation, while another 10% expectSource: Forrester Budget Planning Guide 2026: Security and Risk no change, and 5% foresee cuts.

Top 10 insights from Forrester’s 2026 Cybersecurity Budget Report
Source: Forrester Budget Planning Guide 2026: Security and Risk

3. Cloud security, on-prem tech, and security awareness training are set to lead cybersecurity spending in 2026. Decision-makers are doubling down on cloud security, with 12% boosting budgets in this area by 10% or more, 11% doing the same for new on-premises solutions, and another 10% ramping up security awareness programs. Notably, investments in on-premises security technology appear twice among the top priorities, as 36% plan at least a 5% increase for both new deployments and upgrades to existing infrastructure. The numbers reflect an uneven global adoption of cloud strategies, driven by persistent concerns around cost, security, and data sovereignty. APAC is exceptionally bullish. 78% of companies there plan increased spending on new on-prem security, outpacing EMEA by 10% and North America by 8%.

Top 10 insights from Forrester’s 2026 Cybersecurity Budget Report
Source: Forrester Budget Planning Guide 2026: Security and Risk

4. Forrester recommends that security leaders broaden AI and ML security throughout the enterprise in 2026 as generative AI moves from standalone apps to essential business systems. Productivity suites, CRM platforms, and service tools now embed genAI natively, transforming workflows and widening potential attack surfaces. Enterprises urgently need comprehensive protection across AI models, data, applications, and user identities to counter risks such as model vulnerabilities, data leakage, and prompt jailbreaking. Hyperscalers like Google Cloud and Microsoft are responding quickly, while cybersecurity incumbents, notably Palo Alto Networks with its Protect AI acquisition, actively expand their footprint. Meanwhile, innovative startups, including Knostic and CalypsoAI, both featured at RSA’s Innovation Sandbox, target niche but critical genAI security gaps. Enterprises investing strategically now will securely scale genAI deployments and establish a clear competitive advantage.

5. Standalone SSE spending will sharply decline in 2026 as enterprises shift to unified SASE platforms, streamlining security operations and accelerating Zero Trust initiatives. Initially positioned to fill security gaps left by SD-WAN deployments and the surge in remote work, standalone SSE and isolated ZTNA solutions have now reached their functional limits. Leading companies increasingly adopt integrated platforms like Cato Networks’ cloud-native SASE, which consolidates SD-WAN, ZTNA, SWG, CASB, and firewall capabilities within a single, unified framework. As I’ve noted in VentureBeat, CISOs who pivot to unified SASE platforms benefit from simpler integration, superior AI-driven threat detection, and significant operational efficiencies that isolated solutions cannot deliver. Organizations proactively embracing integrated SASE from providers like Cato Networks will immediately enhance security resilience, improve operational agility, and significantly reduce vendor complexity.

6. Forrester predicts that by 2026, security leaders will seize a critical advantage by accelerating the adoption of post-quantum cryptography (PQC). With NIST’s landmark release of three core PQC standards in August 2024, organizations now have clear guidance to protect their data and applications against emerging quantum threats. Most governments align with NIST timelines, targeting legacy encryption deprecation by 2030, while Australia’s ASD urges adoption of approved PQC algorithms even sooner. Enterprises should immediately focus efforts on securing their most sensitive asymmetric cryptography, covering data at rest, data in transit, and data actively used within applications. Comprehensive cryptographic discovery and inventory tools provide the visibility required to assess readiness. Strategic partnerships with cryptoagility innovators, including Entrust, IBM, Keyfactor, Palo Alto Networks, QuSecure, SandboxAQ, and Thales, enable organizations to define a clear, secure migration path. Organizations acting decisively now will confidently navigate the quantum transition and fortify their competitive edge.

7. Machine identity management will become essential by 2026 as automated identities multiply rapidly across the IT infrastructure. Apps, AI agents, IoT devices, containers, cloud environments, and infrastructure scripts now generate identities faster than humans can manually track or manage. Enterprises urgently require solutions capable of managing these identities throughout their lifecycle, automating key rotations, and enforcing role-based access. Leading vendors, including Akeyless, BeyondTrust, CyberArk, Delinea, HashiCorp, Keyfactor, AppViewX, and emerging startups like Aembit, Astrix, Clutch, Entro, and Oasis Security, offer robust platforms to meet this challenge.

8. There will be a significant reallocation away from standalone interactive application security testing (IAST) in 2026, as operational hurdles continue to limit adoption. Originally designed to blend the runtime accuracy of dynamic application security testing (DAST) with static application security testing’s (SAST) code-level insights, standalone IAST has proven overly complex. Forrester recommends shifting budgets toward integrated IAST and DAST platforms, such as those from Invicti and HCLSoftware, that simplify deployment. Alternatively, APIs, microservices, and containers provide more transparent and consistent returns.

9. Consolidation of endpoint security and SIEM tools will accelerate in 2026. As extended detection and response (XDR) platforms gain momentum, security leaders have a clear opportunity to reduce agent sprawl, improve analyst efficiency, and lower the total cost of ownership. Vendors, including Microsoft, CrowdStrike, and Palo Alto Networks, now embed critical SIEM functions such as detection, correlation, third-party data ingestion (particularly from cloud, identity, and email), and response directly within their XDR offerings. While these integrated solutions currently don’t fully match standalone security analytics platforms, they deliver compelling advantages: simplified deployments, centralized threat context, and measurable operational savings. Organizations consolidating around unified XDR solutions today will streamline security operations and achieve faster, higher-quality threat detection.

10. By 2026, rapidly evolving generative AI will make deepfakes virtually indistinguishable from authentic media, rendering simplistic identity checks obsolete. Enterprises must proactively deploy sophisticated detection platforms using advanced ensemble modeling—spectral analysis, image artifacts, skin tone consistency, lighting anomalies, audio echo patterns, and device reputation, to ensure trusted employee verification and transaction authentication. Vendors such as GetReal Security, Sensity, and Reality Defender already offer real-time risk scoring, transparent reasoning, and integrated case management. Early adopters will safeguard identity security, sustain customer trust, and remain resilient against future deepfake threats.

Top 10 fastest-growing segments from Gartner’s latest information security forecast Q4 2024

Top 10 fastest-growing segments from Gartner’s latest information security forecast Q4 2024

Gartner’s latest information security forecast reflects the optimism of most CISOs about their budgets increasing in 2025. Ninety percent of security and risk management leaders, including CISOs, told Forrester they expect a budget increase this year.

According to Gartner’s latest Q4 2024 forecast, end-user spending will surge from $183.7 billion in 2024 to $293.9 billion in 2028, reaching a 12.47% compound annual growth rate.

Information security spending will grow rapidly, driven by increasing investments in areas such as cloud security (25.9% CAGR) and managed security services (15.0% CAGR) as more enterprises face the many challenges of securing hybrid cloud environments.

Key segments, including infrastructure protection and professional services, underscore the urgency nearly all organizations have in securing their critical systems against increasingly lethal AI and generative AI (gen AI) attacks.

Below is a visual representation of the top 10 fastest-growing segments shaping the cybersecurity landscape.

Please click on the graphic below to expand it for easier reading.

Gartner forecast based on latest information security forecast for 4Q, 2024

The 10 fastest-growing information security market segments going into 2025

Infrastructure Protection

With spending projected to grow from $31.3 billion in 2024 to $51.2 billion in 2028 (CAGR: 13.1%), infrastructure protection leads the information security market. Securing infrastructure that will increasingly be used to manage model data, LLMs, and AI apps is one of the core drivers in this segment going into 2025. The latest Gartner forecast reflects the growing demand for infrastructure true protection as more organizations go all in on AI.

Security Professional Services

Spending on professional security services is expected to grow from $27.3 billion in 2024 to $42.3 billion in 2028, attaining a CAGR of 11.6%. These services are critical for implementing zero-trust policies and conducting proactive security assessments.

Managed Security Services

Managed security services spending will rise from $24.1 billion in 2024 to $42.1 billion in 2028, reflecting a CAGR of 15.0%. Outsourcing security to external providers has become essential as companies face a more lethal, AI-dominated threatscape while grappling with talent shortages.

Network Security Equipment

Spending on network security equipment will increase from $21.7 billion in 2024 to $32.8 billion in 2028, attaining a CAGR of 10.9%. This reflects the growing need to secure hybrid and multi-cloud networks as organizations expand their digital perimeters.

Security Consulting Services

Spending on security consulting services will grow from $23.0 billion in 2024 to $32.6 billion in 2028, delivering a CAGR of 9.1%. More organizations are looking outside for in-depth expert advice as they attempt to implement advanced security frameworks. Getting compliance right and ensuring consistency when reporting material events to the Security and Exchange Commission (SEC) are also drivers of this segment’s forecast.

Identity Access Management (IAM)

IAM spending will rise from $17.7 billion in 2024 to $25.4 billion in 2028, achieving a CAGR of 9.4% according to Gartner forecast. A key subsegment, Privileged Access Management (PAM), is projected to reach $2.9 billion by 2025 as growing regulatory compliance requirements on a global scale are expected to drive adoption.

Cloud Security

Cloud security spending will grow from $9.0 billion in 2024 to $22.6 billion in 2028, achieving a CAGR of 25.9%. As cloud environments become more complex, investments in Cloud Security Posture Management (CSPM) and Cloud Workload Protection Platforms (CWPP) will continue to accelerate growth.

Other Security Software

Spending on niche and innovative security software solutions will grow from $9.0 billion in 2024 to $14.7 billion in 2028, attaining a CAGR of 13.0%. This category includes specialized tools and apps used for combating advanced social engineering and adversarial AI-based attacks.

Data Security and Privacy

Spending on data security and privacy will increase from $6.1 billion in 2024 to $10.3 billion in 2028, reflecting a CAGR of 14.0%. Stringent data protection regulations and growing cyber threats are driving investments in this segment.

Application Security

Application security spending is forecasted to rise from $6.3 billion in 2024 to $10.1 billion in 2028, driving a CAGR of 12.7%. This segment addresses vulnerabilities in software applications, which remain a primary target for attackers.

Conclusion

Organizations are prioritizing agility and the ability to anticipate new threats while doubling down on cloud security. Predicted to grow at a 25.9% CAGR, cloud security is the fastest-growing segment in the forecast.

Spending on new tools to detect emerging threats is projected to jump from $9 billion in 2024 to $14.7 billion in 2028, further indicating that organizations are willing to invest in new technologies to stop emerging threats.

Ultimately, cybersecurity has become a more crucial business decision than ever before. While other organization budgets are being slashed going into 2025, cybersecurity continues to see gains and is increasingly seen as an investment in business resiliency.

Top Ten Insights from Forrester’s 2024 Cybersecurity Budget Benchmarks

Top Ten Insights from Forrester's 2024 Cybersecurity Budget Benchmarks

CISOs are being asked to do a lot more with less as their businesses are going all-in on new digital businesses that demand identity-based security while keeping budgets tight for securing infrastructure against attacks.

Cybersecurity budgets are, on average, just 5.7% of IT annual spending. That’s tight for many security teams. CISOs are rising to the challenge, however, and delivering revenue gains by protecting new digital businesses while keeping infrastructure safe. Achieving that is a quick way for CISOs to advance their careers.

Cybersecurity needs funding to match its business growth potential

The good news is that more CEOs and boards see cybersecurity as a business enabler. The challenge for CISOs, however, is that cybersecurity still gets funded purely for its defensive value – not its upside potential to drive growth.

Many security teams struggle to make ends meet in their budgets while still staying responsive to internal teams’ needs. Forrester’s 2024 Cybersecurity Benchmarks Global Report shows just how tight budgets can get for a CISO and their team. Project-related work and incident management are a constant balancing act for security teams, and keeping them both in check is key to staying under budget.

Top Ten Insights

Cybersecurity budgets are on the low side compared to the growing complexity of threats and risks organizations face.

That’s forcing CISOs to be selective about what they spend on and how they allocate limited resources. Add to that the average spend of $1,070 per enterprise user and $157,000 per cybersecurity employee, and cybersecurity teams have little, if any, room for inefficiencies.

The following are the top ten insights from Forrester’s latest cybersecurity benchmark report:

  • CISOs need to move out of the IT organization and report to their CEOs and board of directors to have a chance at a more realistic budget. Forrester finds that cybersecurity budgets increase when CISOs report directly to the CEO or board of directors. CISOs who can articulate the business value of cybersecurity, demonstrating how it can drive revenue and support strategic goals, are more likely to secure the necessary funding. This shift also reflects a growing recognition of cybersecurity’s strategic importance beyond mere IT operations.
  • Software will dominate cybersecurity budgets in 2024. The report reveals that 35.9% of cybersecurity budgets globally are allocated to software. This trend is particularly pronounced in large enterprises with up to 74,999 employees, where 39.4% of the budget is dedicated to software. Smaller organizations, conversely, spend a higher percentage on outsourcing services due to limited in-house capabilities, which underscores the scalability challenges smaller firms face in maintaining robust cybersecurity defenses.
Top Ten Insights from Forrester's 2024 Cybersecurity Budget Benchmarks

Source: Forrester 2024 Cybersecurity Benchmarks Global Report

  • Cybersecurity spending per user keeps climbing, reaching $1,070. This is another budget constraint CISOs have to factor into their total operations plans for a given year. Forrester notes that “the cybersecurity spend per enterprise user ranges from an average of $947 at extra-large organizations (75,000 or more users) to $1,210 at small organizations (fewer than 10,000 users).
  • Personnel costs consume 28% of the typical security budget. The report highlights that organizations are spending an average of $157,593 per cybersecurity employee. Full-time employees make up 73.5% of security teams, with the global average cost per contracted full-time equivalent (FTE) reaching $194,613. This significant expenditure on personnel underscores the critical role of skilled professionals in maintaining effective cybersecurity defenses.
Top Ten Insights from Forrester's 2024 Cybersecurity Budget Benchmarks
Source:  Forrester 2024 Cybersecurity Benchmarks Global Report
  • System Defense is the leading functional spend category in 2024. Forrester finds that 29% of functional spending is in System Defense alone. The funding levels approved for this category reflect the critical need to protect endpoints and mobile devices against increasingly sophisticated attacks. With adversaries innovating faster than enterprises can keep up, System Defense is a must-have to protect new digital businesses and infrastructure. The following graphic shows cybersecurity spending by functional domain.
Top Ten Insights from Forrester's 2024 Cybersecurity Budget Benchmarks
Source:  Forrester 2024 Cybersecurity Benchmarks Global Report
  • Identity and Access Management (IAM) takes up 21% of functional spending in the typical budget. Identity-driven attacks take many forms, from mass phishing to whale phishing, where senior executives of a company are targeted with tailored campaigns IAM also enhances operational efficiency and fraud reduction, making it a strategic investment for many organizations. Its broad applicability across both internal and customer-facing applications drives its substantial share of the cybersecurity budget.
  • Security analytics and incident handling reach 13% and 14%, respectively. Forrester notes that each of these separate services accounts for a relatively low percentage of the overall cybersecurity budget. Still, most organizations combine spending on these two categories into “detection and response.” Both areas combined equal 26% of the overall security budget, on average.
  • Getting compliance and governance right is a growing concern for many CISOs who are willing to spend their budget to stay in good standing with the SEC. The Security and Exchange Commission’s Cybersecurity Risk Management, Strategy, Governance, and Incident Disclosure adopted on July 26, 2023. The rules adopted by the SEC define a standardized process for cybersecurity disclosures for public companies. These rules require companies to disclose material cybersecurity incidents on Form 8-K or Form 6-K within four business days of determining the incident’s materiality. Additionally, companies must include cybersecurity risk management, strategy, and governance information in their annual reports (Forms 10-K and 20-F). The rules also mandate the use of Inline XBRL for tagging these disclosures.
  • Incident handling is on average, 13.5% of a global cybersecurity budget. This category is the most unpredictable, as it deals with responding to intrusions and breaches that cannot be forecasted. Spending on incident handling varies by company size, with small organizations (fewer than 10,000 employees) aligning with the global average of 13.5%. Larger organizations tend to allocate slightly less, likely due to more extensive preventative measures and diversified cybersecurity resources.
  • Privacy is core to customer trust today and gets funded, even in tough budgeting cycles. The two departments that use privacy-related solutions the most frequently are legal and marketing, which dedicate on average 12% of a cybersecurity budget to them. Forrester notes that this 12% figure is not the total privacy spend of an organization. Rather, the report says, “Data privacy spans multiple areas of the organization, including marketing and legal. Its share of the security budget doesn’t represent the total spending on privacy-related initiatives across the entire technology estate.

Balancing the scales of cybersecurity budgeting

The bottom line is that cybersecurity is a business decision and needs to be funded with that mindset. Organizations need to see the CISO role as a more board-level one so they can share their technology expertise in helping to manage risk.

It’s time for cybersecurity to be funded as a growth engine, not just one used for deterrence alone.

CISOs can balance the scales by looking for an opportunity to elevate their role to a CEO direct report and, ideally, be on the board to help guide their companies through an increasingly complex threat landscape.

GenAI and IoT security are core to Forrester’s top 10 emerging technologies in 2024

Predicting that generative AI (genAI) for visual content, genAI for language, TuringBots, and IoT security will be the four technologies that deliver the most immediate ROI in two years, Forrester’s Top 10 Emerging Technologies In 2024 reflects the urgency more businesses have for making AI pay while securing their most at-risk endpoints.

Rounding out Forrester’s ten emerging technologies are AI agents, autonomous mobility, edge intelligence, quantum security, extended reality (XR), and Zero Trust Edge (ZTE).

Forrester’s stack ranking of technologies by ROI potential

Advising clients to include ten emerging technologies on their radar and roadmap, Forrester has segmented them into short-term, medium-, and long-term groups based on their potential to deliver ROI. Three of the ten emerging technologies are cybersecurity related.

Technologies predicted to deliver the most significant ROI over the next two years

GenAI for visual content and language. Given how quickly genAI’s adoption is accelerating across enterprises via a myriad of cloud-based apps and tools, especially in marketing, digital design, and communications, it’s clear why Forrester predicted that genAI for visual content, genAI for language have the potential to deliver ROI in two years. Forrester notes that “genAI for language is already delivering value in customer support and content creation but continues to advance at a blinding pace. It is accelerating many other technologies as it goes.”

TuringBots are predicted to accelerate app development. The report states that these AI-powered software robots “help developers build applications that deliver more than just code generation” thanks to advancements in genAI for language. TuringBots are defined as “AI-powered software that augments application development teams’ automation and semiautonomous capabilities to plan, analyze, design, code, test, deliver, and deploy while providing assistive intelligence on code, development processes, and applications.”

IoT Security to secure the proliferating number and variety of endpoint devices. Forrester defines IoT security technology as including components that are “familiar to endpoint management and security: asset management, identity and access management (IAM), data security management, Zero Trust networking, and attack surface risk management.” Forrester predicts that deploying IoT security solutions will deliver expected business value within a year as vendors increasingly offer capabilities as part of other cybersecurity platforms.

GenAI and IoT security are core to Forrester's top 10 emerging technologies in 2024

Source: Forrester’s Top 10 Emerging Technologies In 2024

Emerging technologies predicted to deliver ROI in two to five years

AI agents. Forrester is seeing AI agent technology stacks include advanced deep learning techniques, including generative, predictive, and reinforcement learning, that enable greater context, analysis, strategy, and planning. Forrester believes their full realization is two to five years away, predicting that “organizations with large amounts of information and sizable human workforces will likely see the biggest and most immediate benefits.”

Autonomous mobility. Manufacturing and logistics are two industries shifting workloads from initial pilots into production, according to Forrester. Both industries are facing continued labor shortages, regulatory pressures, and rising costs and see the potential to improve traffic and supply chain management results. Key benefits include greater operational efficiencies across shop floors, improved regulatory compliance, enhanced worker productivity and safety, and more accurate data to track environmental sustainability efforts.

Edge intelligence. Edge intelligence, according to Forrester, is “the ability to collect data, make assumptions based on that data, and link that data to relevant, distributed, orchestrated, and contextually driven responses in a network of application, device, and communication ecosystems.” The report further defines the tech stack for edge intelligence as including streaming analytics, edge ML, federated ML, and real-time data management on intelligent devices and edge servers.

Quantum security. Reducing the risk of “harvest now, decrypt later” quantum attacks, providing increased cryptographic agility for the future, and improving digital signatures are a few of the many benefits quantum security delivers. Asymmetric and symmetric key generation, symmetric key distribution via QKD, digital signatures and certificate management, and keeping an accurate list of cryptographic algorithms are some of the most common uses. These benefits and use cases form the basis of Forrestter’s assigning quantum security into the mid-segment of their stack ranking.

GenAI and IoT security are core to Forrester's top 10 emerging technologies in 2024

Source: Forrester’s Top 10 Emerging Technologies In 2024

Emerging technologies predicted to deliver ROI in over five years

Extended reality (XR). Forrester defines XR as “a technology that overlays computer imagery on a user’s field of vision, with augmented reality (AR), mixed reality, and virtual reality (VR) technologies that are supported by the same developer tools, sensors, cameras, and simulation engines.” Their report notes that only 8% of US online adults own a virtual-reality headset, and just 16% have used an augmented-reality device or app. While XR is advancing in training and onboarding, companies are resisting investing in tools like these until they see broad adoption.

Zero Trust Edge (ZTE). ZTE technology has the potential to protect remote workers, retail outlets, and branch offices with embedded local security. Highly distributed enterprises with little variation between sites are predicted to see the greatest benefit first.

Conclusion

Forrester sees security as core to any organization seeking to maximize the value and ROI of emerging technologies.

Three cybersecurity technologies, IoT security, quantum security, and zero trust edge (ZTE)—form the foundation of the ten emerging technologies. “The inclusion of these security technologies underscores a crucial point: the future belongs to those with the foresight and will to invest in security now. As AI capabilities expand, so do the potential vulnerabilities that malicious actors can exploit,” writes Brian Hopkins, vice president, emerging tech portfolio at Forrester.

Defending endpoints need to start with a zero-trust framework that enforces least privileged access and monitors everything happening on the network while also enabling microsegmentation to reduce the blast radius of a potential cyberattack. Relying on legacy account and identity and access management (IAM) systems that assume trust across systems and within identity management data structures is a breach waiting to happen.

Forrester’s top ten emerging technologies show a progression from already having significant use cases and adoption to newer technologies that are nascent in the market. All share a common characteristic with security, however. As technologies get more complex and remain unproven, security technologies need to step up the use of new technologies to counter threats. Quantum security and zero trust edge correspond with the direction of the ten emerging technologies. They reflect the need to keep improving security to protect the best ROI possible with new technologies on the horizon.