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Despite multiple reports of businesses tightening up their corporate budgets and spending plans, the market for cybersecurity continues to be an area of strength for many of the top players in the sector.
According to research firm Canalys, the worldwide market for spending on cybersecurity technology and systems rose to $19.6B in fourth quarter of 2022, an increase of 14.5% from the prior-year's same period. Total spending on cybersecurity for all of 2022 rose almost 16% from 2021, to $71.1B.
Canalys said that during the fourth quarter last year, network security accounted to $5.4B spent on security systems, while vulnerability and security analytics made up $4.2B in sales, and identity access management accounted for $3.7B of the quarter's total security revenue.
Matthew Ball, chief analyst at Canalys, said that while corporate IT budgets are seeing signs of constraint overall, "cybersecurity remains a priority," and that "secure services edge, identity access management, cloud security and modernization of security operations centers remain areas of focus."
Among the top cybersecurity vendors, Canalys said Palo Alto Networks (NASDAQ:PANW) remained in the top spot overall, with a 7.9% market share during 2022's fourth quarter, up from 7.3% in same quarter in 2021. Fortinet (NASDAQ:FTNT) took second place, with 6.8% of the market, while Cisco Systems (CSCO) slipped from second to third place, with a 6.1% market share.
Ball said that the largest and most successful cybersecurity vendors "have used 'land and expand' sales strategies" in order to grow and take a larger share of total cybersecurity spending over the past two years.
"This places the top cybersecurity vendors in a stronger position to weather the economic downturn and capitalize on customers consolidating their vendor relationships to reduce costs," Ball said.
As trading progressed Thursday, Palo Alto Networks (PANW) shares were up by more than 2%, while Fortinet (FTNT) stock climbed more than 4% and Cisco (CSCO) was up by almost 2%.
Earlier this week, Wedbush analyst Dan Ives listed Palo Alto Networks (PANW) among big-name tech companies as "safety blankets" in the midst of the current banking industry debacle.