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Cybersecurity and identity security have moved from cost center to growth engine in enterprise software. The latest flow of company updates shows that identity controls, zero trust architectures, and AI assisted defense are now primary budget priorities across sectors. This is not theoretical. Vendors are reporting stronger pipelines, larger deal sizes, and platform expansions aligned to identity centric security and data protection.

Identity leaders are seeing tangible momentum. Barclays lifted Okta’s (OKTA) target to 112, citing strong remaining performance obligations that reflect multi quarter demand visibility. SailPoint is scaling up engagement with large enterprises through a new partnership with HCLTech to deliver modern identity security at the speed and scale required by AI enabled environments, and it is in front of investors at multiple conferences. DigitalOcean rolled out Single Sign On to streamline access control for cloud users, validating how even developer first platforms are hardening identity to reduce risk and administrative overhead.

Zero trust adoption is accelerating as attack surfaces expand. Zscaler (ZS) presented strong FY25 results and continues to emphasize AI driven inspection and policy automation. A separate note called zero trust everywhere a silver bullet for growth, consistent with the company’s focus on annual recurring revenue expansion and new AI features highlighted in its conference transcript. Palo Alto Networks’ (PANW) CEO described the future of AI driven cybersecurity at Citi’s tech forum, signaling customer urgency to augment threat prevention and response with machine learning across cloud and endpoint.

The demand signal is not limited to pure play security. Observability and application performance vendors with security adjacencies are benefiting as enterprises converge telemetry, detection, and incident response. Datadog (DDOG) reported Q2 2025 revenue of 826.76 million, up 28.1 percent year over year, with Citigroup boosting its target on AI growth. Dynatrace won new coverage with an Outperform rating on AI driven growth potential and outlined go to market incentives at Citi’s conference. These platforms increasingly serve security operations with logs, metrics, traces, and anomaly detection, and are positioned to capture identity data and permissions analytics as customers consolidate tools.

Data security and resilience remain core buying criteria. Cohesity, an Nvidia backed data security vendor, is preparing an IPO after stating that its size and scale are now in place. TransUnion partnered with Prime Radiant on a personal cyber platform that integrates identity monitoring, home network security, risk assessments, and insurance backed remediation for executives and families. Norton Small Business expanded its product with Dark Web Monitoring and Social Media Monitoring to alert on compromised credentials and abuse risks. Together these moves underscore a broadening of the identity perimeter from workforce to households and small businesses that interact with enterprise systems.

Enterprise software providers outside classic security continue to report durable subscription growth tied to cloud modernization that raises the bar for identity and data protection. Guidewire beat with record annual recurring revenue and highlighted 19 percent ARR growth, driven by insurers moving core systems to the cloud where identity governance is mission critical. DocuSign (DOCU) beat on revenue at 800.6 million, up 8.8 percent year over year, and lifted its outlook as customers adopt AI enhanced agreement workflows that require rigorous access control and audit trails. Samsara (IOT) ended the quarter at 1.6 billion in ARR, up 30 percent year over year, with a record 17 customers at 1 million plus ARR. As connected operations scale in transportation and field services, machine identity and device access become central to risk management.

Network and data center buildouts linked to AI are amplifying security requirements. Ciena (CIEN) delivered fiscal Q3 revenue of 1.22 billion, up 29.4 percent year over year, and 41.9 percent adjusted gross margin, citing high speed connectivity demand as AI workloads ramp. HPE reported 9.1 billion in revenue with AI systems and networking in focus and said it is aggressively adopting agentic AI. As AI infrastructure proliferates, identity aware segmentation, key management, and secure service to service authentication are becoming baseline asks in RFPs.

The impact cuts across sectors. Financial services are pushing toward fully digital custody and clearing. State Street and Apex announced a platform for global wealth, a move that will hinge on strong identity verification, policy based entitlements, and continuous monitoring. Healthcare digitization is accelerating, raising stakes for privacy and identity. Northwestern Medicine adopted Tempus AI’s clinical copilot inside its EHR, and GE HealthCare outlined product growth drivers. These capabilities require strict role based access and data lineage controls. Consumer platforms are tightening safety. Roblox partnered with IARC on content ratings and launched Sentinel, an AI system for detecting child endangerment, indicating sustained investment in trust and safety. Critical infrastructure is in focus. A food and agriculture threat intelligence group launched to help firms thwart cyberattacks, while utilities like Consumers Energy warned customers about new payment scams, a reminder that identity proofing and transaction risk scoring are essential even for regulated monopolies.

Not all signals are green. Gartner’s stock fell on concerns about budget constraints and potential AI disintermediation, a reminder that buyers will scrutinize ROI and vendor overlap. GitLab (GTLB) beat earnings but guided cautiously and announced a CFO departure, illustrating that security adjacent dev tooling is not immune to deal timing and platform consolidation. Investors should also watch valuation discipline. While demand is robust, short interest against infrastructure names like Pure Storage shows that the market will challenge narratives where growth, margin, or stickiness are not fully proven.

The near term consequences are clear. Identity platforms with strong pipelines and ecosystems are positioned to consolidate share as customers reduce tool sprawl. Zero trust vendors with AI policy engines can capture larger bundles across secure access, cloud posture, and data protection. Observability leaders will win security budgets for unified telemetry and insider threat detection. Data security and backup recovery platforms will benefit from ransomware preparedness mandates and cyber insurance underwriting standards that increasingly require immutable storage, least privilege, and automated recovery tests.

Practical strategies based on the current data points:

• Favor identity control leaders with multi product expansion. Okta’s target hike on strong RPO and SailPoint’s integrator partnership suggest healthy multi quarter demand for workforce and machine identity. Assess attach of lifecycle governance, privileged identity, and identity threat detection across the customer base.
• Lean into zero trust and SSE platforms scaling with AI. Zscaler’s ARR momentum and Palo Alto’s AI messaging point to broader platform wins. Focus on vendors delivering measurable reductions in breach exposure and admin overhead through automated policy creation and continuous verification.
• Back convergence plays in observability and security. Datadog’s 28.1 percent revenue growth and Dynatrace’s new coverage reflect budgets shifting to unified telemetry that feeds both performance and security use cases. Prioritize offerings with strong log analytics, identity context enrichment, and anomaly scoring.
• Allocate to data security and cyber resilience. Cohesity’s IPO prep highlights investor appetite. Evaluate platforms that combine backup, ransomware detection, least privilege enforcement, and rapid restore at petabyte scale.
• Do not ignore SMB and personal identity protection. Norton’s expanded monitoring and TransUnion’s integrated platform show growing demand in segments that often connect into enterprise workflows. These channels can become efficient feeders for larger enterprise deals.
• Track sector adoption catalysts. Financial infrastructure upgrades like State Street and Apex’s digital custody will require rigorous identity and policy controls. Clinical AI rollouts and EHR integrations at systems like Northwestern Medicine raise identity risk that will drive spending on access analytics and consent management. Critical infrastructure initiatives and ISAC participation in food and energy signal steady security opex.
• Underwrite with discipline. Balance enthusiasm with watchpoints from GitLab’s softer guide and research commentary about budget pressures. Favor vendors showing net retention durability, partner leverage, and clear gross margin expansion paths.

The common denominator across these updates is that identity is the control plane for modern security, and AI is both the catalyst and the accelerant. Enterprises are buying platforms that unify who should access what, when, from where, and under which risk policies, then automating those decisions with machine learning. With multiple vendors reporting record ARR, raised targets, and platform expansions anchored to identity, the theme is translating into revenue today. The next leg of outperformance likely accrues to companies that prove they can secure identities across humans, services, devices, and data while simplifying operations and demonstrating quantifiable risk reduction.

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