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Cybersecurity Stocks Tumble on AI Competition Fears
21 Feb
Summary
- Cybersecurity stocks declined sharply on Friday due to new AI features.
- Anthropic's Claude AI now scans code for vulnerabilities and suggests patches.
- Investors fear AI 'vibe code' will reduce demand for existing software products.
Shares of major cybersecurity software firms experienced sharp declines on Friday. This downturn was triggered by Anthropic PBC's announcement of a new security feature integrated into its Claude AI model. The update is designed to scan codebases for security vulnerabilities and propose software patches for review.
Among the biggest decliners were Crowdstrike Holdings, falling as much as 6.5%, and Cloudflare Inc., which slumped over 6%. Other affected companies included Zscaler, SailPoint, and Okta. The Global X Cybersecurity ETF also saw a significant drop, extending its year-to-date losses.
This event highlights growing investor concerns regarding competition from AI-native companies. The ability of AI to 'vibe code'—generate software code—is leading to fears that users will increasingly create their own applications, thereby diminishing demand for legacy products. This sentiment has been building for weeks, impacting the broader tech-software sector.
