CrowdStrike and Palo Alto Networks rose, up roughly 14% and 13%, as cybersecurity shares rallied after public warnings from leading AI figures about model safety risks.
The move reflected investors leaning into defence demand. Both stocks have essentially doubled over the past six months, sharply outperforming chipmakers. Gartner estimates global AI-cybersecurity spending at $51.3 billion this year, rising to $86 billion in 2027.
"Dario did it in one week, better than me, clearly," said Nikesh Arora, chief executive of Palo Alto Networks, capturing management's view that recent AI headlines have sharpened customer focus on security.
A wider rotation
The rally followed calls from Anthropic's Dario Amodei, OpenAI's Sam Altman and Elon Musk to slow down and "pace the frontier". The shift helped push down stocks in AI-linked chip and memory names, even as security vendors climbed.
Axios framed the move as part of a broader rotation, with fears about AI, both doomsday and operational, prompting buyers to re-price winners and losers in the AI trade. The next test is whether higher security budgets translate into sustained revenue gains for vendors.
