GoKawiilCrowdStrike and Okta shares surged on Thursday after earnings showed that artificial intelligence adoption is pushing customers to spend more on cybersecurity tools.
Both companies beat Wall Street's estimates for the fiscal second quarter and raised their forecasts, citing the AI agent threat. CrowdStrike's stock gained 20% for its best day ever, while Okta's surged nearly 29%.
The broader cyber sector rallied as well, with shares of Palo Alto Networks , SailPoint , Zscaler and Rubrik up at least 10% each.
"We're in an arms race," CrowdStrike CEO George Kurtz said during an earnings call with analysts on Wednesday. "AI is driving more cyberattacks. AI is driving more cyber spending. AI is driving a clear divide between the cybersecurity companies that solve problems and those that compound problems."
Tune in at 6 p.m. ET for "Mad Money" as Kurtz joins CNBC's Jim Cramer. Watch in real time on CNBC+ or the CNBC Pro stream.
The company's flexible Falcon platform offering, which lets customers switch out security tools, doubled year over year, he said.
The release of advanced AI models like Anthropic's Mythos, and hacks such as the OpenAI -Hugging Face incident, have raised the stakes for the cybersecurity sector in recent months, forcing businesses to scale their security stacks to combat mounting attacks orchestrated by AI agents.
One clear winner has been identity security tools that help businesses secure and manage the explosion in AI agents. Amid this backdrop, cybersecurity stocks have rocketed to fresh highs, with both CrowdStrike and Okta up more than 80% each.