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Cybersecurity threats are rising rapidly – and AI makes them difficult to contain.
“It's become much easier to attack a company,” Zscaler (ZS) CEO Jay Chaudhry told Yahoo Finance executive editor Brian Sozzi on the opening bid podcast (see the video above. Listen below).
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Chaudhry has been able to quickly surface vulnerabilities in corporate systems that have previously conducted several weeks of research to identify research that have been conducted over several weeks. This makes the company defensive. It can also be countered only with similar technologies.
“To fight AI, you have to fight AI,” Chaudry said.
Cybersecurity stocks are some of Wall Street's hottest deals. Zscaler's stocks are up over 57% per year, while Palo Alto Networks (PANW) and CrowdStrike (CRWD) are also rising sharply, suggesting that investors are driving new demand for advanced security systems.
The rise in the generated AI agent adds another layer of uncertainty. While much of the industry's chatter focuses on AI agents for business use, Chaudhry said the technology is still in its early stages.
However, widespread adoption of agents can lead to increased security challenges.
“The challenges of cybersecurity and data protection are ten times bigger,” he said.
For Zscaler, it opens up both risk and opportunity. Currently, the company has over 50 million users and uses Zero Trust Exchange, a cloud platform that securely connects users, apps and devices. Chaudhry said that the same architecture can be extended to allow AI agents to interact with each other and interact with enterprise systems.
Beyond corporate networks, Chaudhry explained that banks and major financial institutions are making significant advances in security, but utilities and infrastructure such as water systems and electrical grids remain dangerously exposed. He cited the Colonial Pipeline Hack in 2021. This closed fuel supply across the East Coast as an example of how quickly the attack could spiral.
“Our country can do a little more and drive infrastructure incentives, which is a certain degree of serious risk as it relies on old technology,” he said.
Ransomware is another permanent threat. Zscaler's latest threat report says the company has blocked attacks, which increased by around 146% year-on-year. According to Chaudhry, some of those enemies are from Eastern Europe and China to the United States.
