Cisco Systems Caught in 2,500-Organization AI Exposure

U.S. artificial intelligence company Anthropic announced on the 6th that it will restructure its certification program for using its AI models in cybersecurity-related work. As a result, individuals engaged in security-related research will also be able to register, allowing more organizations and others to use its most advanced model, Claude Mythos 5.1, which has a strong ability to discover software vulnerabilities. The company will integrate its existing certification program with Project Glasswing, a framework announced in April for accrediting organizations that can use Mythos. Users will be divided into three tiers according to how they use the model. The lowest tier can include small security firms, universities, and individuals, who can use models such as Mythos for defensive work such as vulnerability analysis. The highest tier is intended for organizations responsible for critical infrastructure such as transportation and finance, and they can conduct high-risk security testing and similar work.

CrowdStrike expanded its Google Cloud relationship on September 1, announcing Falcon capabilities designed to protect enterprise AI applications against prompt injection, sensitive-data leakage, and malicious AI activity through Google's Agent Gateway, alongside broader connections between Falcon and Gemini Enterprise. The move follows a fiscal second quarter in which revenue rose 26% year-over-year to approximately $1.47 billion, annual recurring revenue reached approximately $5.84 billion, up 25%, and net new ARR added during the quarter totaled $332.8 million. ARR from customers using Falcon Flex exceeded $2.29 billion, up 101% from a year earlier, while operating cash flow increased to $530.3 million from $332.8 million and free cash flow rose to $377.4 million from $283.6 million. Management raised its full-year fiscal 2027 net new ARR growth outlook to 34% at the midpoint. Jim Cramer highlighted CrowdStrike on Mad Money on October 1, noting the stock rallied 39% and that the Charitable Trust owns it, though the company still trades at roughly 210x forward earnings versus 96x for Palo Alto Networks and reported a $33.2 million GAAP operating loss against $371.6 million in non-GAAP operating income. Legal exposure from the July 2024 outage remains unresolved, with discovery ongoing in Delta's lawsuit and the company disclosing requests for information from the Justice Department and SEC concerning revenue recognition, ARR reporting for certain customers, and the outage.

Advanced Micro Devices CEO Lisa Su said demand continues to outpace supply and that the company plans to substantially increase supply in 2027, sending AMD shares higher in early trading Tuesday. Roughly 80% of Anthropic's planned $518 billion in cloud and compute spending over the next decade is non-cancelable or payable regardless of how much capacity it actually uses. Elon Musk confirmed over the weekend that SpaceX and Taiwan Semiconductor are in discussions about a potential collaboration in which the Taiwanese foundry may use Terafab, the vertically integrated semiconductor manufacturing initiative launched by Musk, Tesla and SpaceX, as an anchor client for a future Texas facility. Zscaler reaffirmed its Q1 and full-year 2027 guidance, with CEO Jay Chaudry warning that autonomous AI agents will become the primary cybersecurity risk vector in coming years. Wells Fargo maintained its overweight rating on Meta Platforms and raised its price target to $1,000, citing Muse as a driver of a larger long-term AI cycle.

The First Trust Cybersecurity ETF (CIBR) reached an all-time high on Monday as the tech-heavy Nasdaq Composite (^IXIC) notched a fresh record, with the fund's main holdings CrowdStrike (CRWD), Palo Alto Networks (PANW), and Fortinet (FTNT) all sitting near all-time highs after surging 132%, 131% and 97%, respectively. Rubrix (RBRK), F5 (FFIV), and Cloudflare (NET) also sit near record highs after a strong rally this year. Alarm bells from leadership at Anthropic and OpenAI prompted a rally in cybersecurity stocks last month, and the surge in AI agent usage and the popularity of Meta's (META) Muse have also highlighted the need for the industry. "Agents going rogue is the biggest risk today," Jay Chaudhury, CEO of Zscaler, told Yahoo Finance's Brian Sozzi on Monday, adding that a hijacked or rogue agent on a corporate network is far more dangerous because it works at machine speed. Morgan Stanley analysts, who have Overweight recommendations on Palo Alto Networks, CrowdStrike, and Okta (OKTA), expect corporate spending on cybersecurity software to grow by 23% annually through 2028, potentially accelerating to 33% annually if major cyberattacks spur new government mandates.

Zscaler founder and CEO Jay Chaudhry warned that companies and individuals are placing too much trust in AI agents, saying on Yahoo Finance's Sozzi Unleashed that agents should be given only limited trust for certain applications and services. Chaudhry, whose company carries a $33.9 billion market cap, said frontier AI models can find security vulnerabilities in websites, firewalls, VPNs and load balancers, break in, and move freely across corporate networks. A new Deloitte survey found that about 80% of organizations currently lack mature governance capabilities for agentic AI, including clear boundaries on independent decisions, real-time monitoring of agent behavior, and audit trails of agent actions. Chaudhry said he plans to share a more detailed product roadmap to combat AI agent risk at an investor day on Tuesday, the company's first since 2021. He called agents going rogue the biggest risk today, noting they operate at machine speed with no breaks and can exfiltrate confidential data or bring systems down.