Investing in Cybersecurity Stocks in 2025

Cybersecurity spending has soared since the COVID-19 pandemic. Organizations have faced new security challenges as cloud computing and remote work have become essential and widely used. As a result, many cybersecurity stocks were top performers in 2020 and 2021, boosted by strong demand for next-gen security software.

A bear market in 2022 clobbered some of the highest-flying stocks, followed by a wide range of shifting results. However, cybersecurity often bounces back quickly from sudden market challenges, and the industry remains a top investment theme for the decade.

1. CrowdStrike Holdings

A cloud-native software company, CrowdStrike Holdings (CRWD -0.52%) provides endpoint security -- protection for devices such as laptops, PCs, smartphones, and any other device connected to a network. Because it's cloud-based, CrowdStrike is particularly well suited for supporting remote work.

CrowdStrike's software uses machine learning to detect security breaches and hunt down threats. It's also easy to deploy to the millions of people working from home and the billions of machines connected to the internet.

The company has steadily increased the number of modules on its platform to help its customers. It also has new integration agreements with other tech companies to make data protection more consistent across an organization's IT infrastructure.

The premium-priced stock was hit hard in 2022, and its security network suffered a painful outage in July 2024. CrowdStrike's sales have been booming nonetheless, and the artificial intelligence (AI)-driven stock rose 16% in 2024 despite the outage. The company is also highly profitable in terms of free cash flow. In an increasingly mobile world with more devices continually coming online, CrowdStrike is poised to continue growing at a brisk rate.

2. Zscaler

Another cloud-native security vendor, Zscaler (ZS -1.35%), works in tandem with endpoint security services to help keep data secure. The company has been increasing its sales at a rapid pace and is another of the largest pure-play cybersecurity stocks as measured by market cap. The stock sold off sharply in 2022, bounced back in 2023, and took another hit the next year. The roller coaster ride notwithstanding, Zscaler continues to deliver profitable revenue growth.

Zscaler started with a software-as-a-service (SaaS) product designed for network protection in the modern cloud computing era, but it has since added new internet security and end-user monitoring products. End-user monitoring is increasing with so many people now working remotely. With global spending on cloud computing expected to exceed $1 trillion annually this decade, Zscaler is well positioned to profit from a massive secular growth trend.

3. Okta

Okta (OKTA -2.59%) is a pioneer of identity and access management, which rethinks traditional security by using zero-trust architecture. This type of identity management constantly requires user verification before allowing access to data and applications. If legacy security is a castle with a wall and a moat, zero-trust security acts more like a counterspy agency.

In an increasingly mobile and cloud-based world, Okta's identity management software has been in high demand. Businesses often have a complicated web of stakeholders, including employees, third-party contractors, suppliers, and customers.

Okta is a leader in this branch of security. However, a cyberattack in January 2022 affected two of its largest customers, accelerating the stock's decline during the inflation-driven bear market. Even so, Okta remains in a long-term growth mode as new customers adopt its software to manage identity and access security.

4. SentinelOne

SentinelOne (S -2.41%) is another recent pure-play cybersecurity company to be publicly listed. Its initial public offering (IPO) in June 2021 raised $1.2 billion in cash and valued the company at $10 billion, making SentinelOne's IPO the largest ever for a cybersecurity company.

A rough go for the stock market in 2022 and slowing revenue growth at SentinelOne sent the stock below its IPO price, and an 88% price jump in 2023 was not enough to regain the IPO level. Despite the slowdown, this small company still more than doubled its sales in 2022, followed by strong increases in 2023 and 2024.

As a result of this rapid expansion, SentinelOne is also making steady progress toward turning a profit. It operates a cloud-based endpoint security platform, which puts it in direct competition with CrowdStrike. Its ability to automatically detect and resolve cybersecurity threats is well-received in the market.

5. Palo Alto Networks

Fortinet is also a top provider of firewalls. Its best-in-class hardware continues generating more revenue as many organizations turn to Fortinet for help building new data centers and 5G mobile networks. For investors seeking a balance of sales and profitability growth, Fortinet stands out as one of the best security stocks on the market.

1. Datadog

Datadog (DDOG -1.09%) is a cloud-native platform built to collect, monitor, and yield insights on cloud-based data and operations. The company uses AI to help automate the process of monitoring large and complex data sets, relieving some of the burden of busy IT teams.

It's also been steadily expanding its platform's capabilities with new modules that include cloud-based security and data monitoring. Data analytics software is a large, fast-growing segment of the tech world, which bodes well for Datadog. Elastic (ESTC -0.67%) and Dynatrace (DT -2.20%) are two other promising software makers to consider in this space.

2. Akamai

As a content delivery network (CDN), Akamai (AKAM -1.55%) ensures data securely arrives at its intended destination. With the amount of data traveling across the internet steadily on the rise, CDNs are becoming increasingly important.

More people than ever are using the web for everything from entertainment to work. To bolster its network security offerings and protect its customers from ransomware attacks, Akamai acquired several smaller security specialists from 2022 to 2024.

CDNs are internet infrastructures that maintain the internet “freeway” on which data travels. Akamai is a leader in this sector and is also a developer of edge computing technology, which pulls data away from centralized data centers and brings it closer to end users.

Cloudflare (NET -0.84%) and Fastly (FSLY -2.00%), which are newer CDN providers, have a sharper focus on edge computing and are competitors to Akamai worth considering.

1. First Trust NASDAQ CEA Cybersecurity ETF

2. Amplify Cybersecurity ETF

Also notable in this sector is the Amplify Cybersecurity ETF (HACK -0.93%). Holding 23 stocks, the ETF invests in many relatively small companies in the cybersecurity industry. The fund manages $2.2 billion in assets and has an expense ratio of 0.6%.

3. Global X Cybersecurity ETF

A relative newcomer to the cybersecurity ETF space, the Global X Cybersecurity ETF (BUG -1.16%) launched at the end of 2019. The fund managed $1.1 billion in assets in the summer of 2025 and has an expense ratio of 0.5%. The Global X Cybersecurity ETF held 24 stocks in its portfolio.

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