Cybersecurity stocks rallied hard Thursday after Okta and CrowdStrike delivered earnings that showed artificial intelligence is pushing businesses to spend more on security tools.
Okta shares skyrocketed 29%, while CrowdStrike gained 19%, following results that beat Wall Street’s fiscal second-quarter estimates and prompted both companies to raise their forecasts, citing the threat from AI agents. The gains rippled across the sector, with Palo Alto Networks, SailPoint, Zscaler and Rubrik each climbing at least 10%.
“We’re in an arms race,” CrowdStrike CEO George Kurtz said on the company’s earnings call Wednesday. “AI is driving more cyberattacks. AI is driving more cyber spending. AI is driving a clear divide between the cybersecurity companies that solve problems and those that compound problems.”
Kurtz is scheduled to appear on CNBC’s “Mad Money” with Jim Cramer at 6 p.m. ET Thursday.
AI threat fuels demand
Kurtz said the company’s flexible Falcon platform, which lets customers switch out security tools, saw demand double year over year. He pointed to the release of advanced AI models such as Anthropic’s Mythos and high-profile incidents like the OpenAI-Hugging Face hack as catalysts that have forced businesses to scale up their security stacks to defend against AI-agent-driven attacks.
Identity security tools, which help companies manage the growing number of AI agents, have been a particular bright spot. Both CrowdStrike and Okta are up more than 80% this year, and Wednesday’s reports marked the unofficial start of cyber earnings season, with Palo Alto Networks and Zscaler among those set to report next week.
Deutsche Bank analysts said they remain “optimistic” about the sector’s growth in the AI era but want to see the upcoming reports to confirm near-term demand trends.
Okta’s early AI traction
Okta CEO Todd McKinnon highlighted early success with new products, which accounted for nearly a third of total bookings.
“While adoption remains in its early stages, momentum is growing, and those advantages are translated into customer demand reflected in the dozens of AI deals we won in Q2,” he said on Wednesday’s call.
Bank of America upgraded Okta shares to neutral from underperform following the results, citing accelerating AI growth, but warned of limited upside ahead.
“We are increasingly encouraged by Okta’s AI opportunity and early customer traction,” the firm wrote. “However, adoption remains very early, disclosed metrics remain limited, and management continues to view AI as immaterial to FY27 results.”
Source: www.cnbc.com — https://www.cnbc.com/2026/08/27/okta-skyrockets-20percent-and-crowdstrike-surges-15percent-leading-cyber-rally.html
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