Palo Alto Networks CEO Nikesh Arora disclosed his first share purchase since November 2019, as artificial intelligence disruption fears weigh on the cybersecurity sector.
The purchase, disclosed Friday in an SEC filing, totaled 68,085 shares at about $10 million. Wall Street viewed the purchase as an upbeat sign for the downtrodden sector, lifting shares of Palo Alto 5%.
Shares have dropped 16% this year.
Cybersecurity stocks have plummeted over the last few months as the software sector falls prey to the narrative that new AI tools will upend their longstanding business models and automate tasks.
In February, Anthropic revealed a tool capable of scanning code vulnerabilities that rattled investors. A report that the AI lab is developing a new and more powerful AI model that could make it easier for hackers to attack, fueled panic on Friday.
Arora addressed these concerns in a blog post on Monday, arguing that AI labs and cybersecurity businesses should join forces in the industry’s “most consequential moment.”
“The stakes are high,” he wrote. “The window to act is open, and we need to act swiftly with intent, together.
Over the last year, Arora has ramped up the company’s bets on cybersecurity with a massive acquisition of Israeli identity security company CyberArk, which closed in February. The company is also leaning into AI with new automation tools and bought AI observability platform Chronosphere for over $3.3 billion.
Okta, CrowdStrike and Netskope rose about 3% on Monday.
Palo Alto stock year-to-date chart.
