Cybersecurity is in a pivotal moment with AI: Palo Alto Networks CEO

In a Tuesday interview with CNBC’s Jim Cramer, Palo Alto Networks CEO Nikesh Arora said cybersecurity is in a pivotal moment as more companies incorporate artificial intelligence into business.

“I think this is a perfect time for security companies to be out there working with our customers to make sure, as we say, ‘deploy AI bravely,’ and it’s going to be an inflection point,” he said.

According to Arora, even “naysayers” of AI are now trying to move data to the cloud in order to keep up with competitors. New AI models require the cloud, he said, claiming that businesses will be left behind if they don’t move their company to the platform. He pointed out that tech megacaps are set to spend more than $300 billion on data centers this year, and companies must make sure their technology is secure.

Arora also touched on the future of agentic AI, suggesting that, “eventually, you’re going to have to give these agents true agency.” He explained that agents will be able to do things like manage manufacturing capabilities and run production systems — which will stir paranoia for businesses as they wonder if the programs could go “rouge.” Cybersecurity is about protecting agents from hijackers, he continued.

Palo Alto Networks posted its quarterly results Tuesday after close, reporting better-than-expected earnings and revenue. However, its gross margin was below estimates. Shares of the company dipped 3.7% in extended trading. Arora said the last quarter was challenging as customers grew anxious about heightened tariffs, pointing in particular to market uncertainty in April.

“I think these are phenomenal results in that kind of an execution environment,” he said.

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Disclaimer The CNBC Investing Club holds shares of Palo Alto Networks.