The global cybersecurity market is on track to record its most successful year with spending expected to continue increasing each quarter.
That’s according to a new Canalys report. The worldwide cybersecurity market grew 11.6% year over year in the second quarter of 2023 to $19 billion. The market is on track to reach $7.89 billion for the year, up from $71 billion for 2022.
Spending remained resilient despite the challenging economic environment and continued scrutiny of IT budgets.
Matthew Ball, chief analyst at Canalys, which shares a parent company with Channel Futures (Informa), said total cybersecurity spending on technology for the second quarter was slightly ahead of Canalys’ best-case forecasts, with better-than-expected renewals among the leading vendors.
“The shift to software-based solutions has been quicker than expected, but this reflects the need for more scalable and flexible architectures,” he said. “The underlying factor that keeps cybersecurity investment a priority is the persisting high levels of threats. Known ransomware attacks and data breaches have surged once again. In reality, organizations are still not spending enough on cybersecurity and catching up from years of under investment.”
Cybersecurity Market Leaders
The top 12 cybersecurity vendors accounted for 49.8% of total customer spending, up from 48.1% in the second quarter of 2022. Palo Alto Networks was the leading vendor in the second quarter, accounting for 9.6% of total spending, followed by Fortinet, Cisco and Crowdstrike.
Growth rates exceeded Canalys’ best-case forecast of 11.2% during the second quarter.
Network security, up 7.4%, remained the largest segment, despite customers prioritizing software investments and delaying some hardware projects.
SMB spending, up 10.6%, moderated, especially in the sub-$100 segment, up 4.9%.. Enterprise spending, up 12.3%, was stronger as the banking sector improved, according to Canalys.
Among leading cybersecurity vendors:
- Palo Alto Networks, up 25.4%, extended its lead in the worldwide cybersecurity market in the second quarter, driven by growth in secure access service edge (SASE), Cortex for SecOPs and cloud security.
- Fortinet, up 19%, gained a share in network security through firewall displacements. It led in three of the four regional total markets in the second quarter.
- Cisco, up 1.2%, retained third position despite its low growth. It continued to undergo a major transition with new leadership, acquisitions and platform launches.
- Crowdstrike, up 34.3%, and Check Point Software Technologies, up 2.8%, rounded out the top five vendors.