The RSA conference this week didn't deliver much breaking news on cybersecurity stocks but Wall Street analysts came away upbeat on industry trends. Cybersecurity firms, though, may not be close to monetizing new "generative" artificial intelligence products.
"Gen AI feels more tangible this year, however, expectations around potential revenue uplift feel more realistic (more of a 2026/2027 story," said Jefferies analyst Joseph Gallo in a review of the RSA conference. "Most Gen AI is being deployed to gain internal efficiencies and to augment existing products. We believe that both the utilization of Gen AI and the securing thereof will become the next growth frontier."
The annual RSA conference focuses on technology and industry trends, including the threat landscape, company vulnerabilities and emerging technologies. At RSA, "agentic" AI as expected was a big theme.
AI co-pilots, which are basically conversational chatbot interfaces, aim to improve worker productivity but rely on human prompts. AI agents execute multistep tasks on behalf of users by solving problems and taking action.
Cybersecurity Stocks: AI Agents Take Over RSA
"Agentic AI discussions were everywhere, but we continue to think there are questions around the timing of adoption," said RBC Capital analyst Matthew Hedberg in a report.
Raymond James analyst Adam Tindle in a report said cybersecurity firms have tempered expectations.
"Exuberance from AI monetization potential in cybersecurity from last year waned and we are seeing basic AI functions being folded into product bundles," Tindle said. "It may be too early to know if agentic will provide more growth to vendors, but we believe agentic does provide vendors a clearer cut case study to show amount of time saved or up-leveling of talent, which can drive better monetization potential."
In cybersecurity, companies expect generative AI tools to help reduce the time it takes to detect and respond to many forms of computer hacking. Also, they see gen AI automating more functions in security operations centers to help companies deal with a shortage of software engineers.
"We are incrementally positive on identity security post-RSA as vendors look to execute on the growing AI opportunity in security spanning both machine identities and AI agents," said Morgan Stanley analyst Keith Weiss in a report. "While vendor commentary
suggested the opportunity remains earlier innings as enterprises continue to take a strategic approach to agent deployment, overall investor interest and conference messaging suggested that securing agentic AI is top of mind."
Computer Security Stocks Outperform
During the RSA conference, Palo Alto Networks announced the acquisition of artificial intelligence startup Protect AI.
On the stock market today, Palo Alto stock gained 1.5% to near 189. PANW stock has gained 4% in 2025.
Meanwhile, the IBD Computer Software Security group ranks No. 9 out of 197 groups tracked.
Among cybersecurity stocks, CrowdStrike Holdings has gained 28% this year, Zscaler has advanced 27% while Cloudflare is up 15%. Also, Fortinet stock has gained 11%.
Amid growing worries over a possible U.S. recession, Wall Street analysts expect corporate spending on cybersecurity to remain a priority over most other software products and services.
Follow Reinhardt Krause on X, formerly Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
