It seems like hardly a day goes by without Anthropic’s Claude artificial intelligence (AI) tool disrupting some corner of the technology sector, causing share price declines in the process. Last week’s “victim” was the cybersecurity industry. Shares of some of the most prominent names in the space, including those residing in the Invesco QQQ Trust (QQQ ) and the Invesco NASDAQ 100 ETF (QQQM ), were punished on news that Anthropic’s vulnerability-scanning tool is proficient at performing the same tasks as products sold by major cybersecurity vendors.
“There is a clear adversarial dynamic, as demonstrated by Anthropic’s own post. Anthropic claims to have found more than 500 vulnerabilities in open-source codebases currently in production or in use,” noted Morningstar analyst Malik Khan. “If Anthropic’s Opus could find these vulnerabilities, a misaligned model with the aim of automating cyber attacks could also find them. This dynamic means that as large language models become more proficient at detecting threats, it benefits both attackers and defenders.”
However, discouraging headlines could eventually morph into positive catalysts for some QQQ/QQQM cybersecurity holdings.
QQQ Not a Lost Cybersecurity Cause
Investors positioning for a rebound by cybersecurity stocks can consider the benefits of QQQ and QQQM. Those ETFs hold multiple cybersecurity names, meaning market participants don’t have to engage in stock-picking. If these stocks do bounce back, there are no guarantees the upside will be uniform across the space.
However, some market observers believe that the Claude-induced panic in the cybersecurity is overblown. It’s possible, perhaps likely, that cybersecurity companies can enhance their product suites with AI, not be punished by it.
“As we move toward real-time cybersecurity applications, the dynamic will look very different,” added Khan. “While LLMs can be trained on security methods and techniques, they simply don’t have access to petabytes of real-time data gathered by large security vendors on a daily basis, and this data matters for training models for security applications.”
Indeed, it’s possible that the intersection of AI and cybersecurity could prove potent for the latter over the long-term. That could potentially provide tailwinds to QQQ and QQQM.
“We see automated code scanning as evidence that we will move swiftly to a world where cyber vendors, leveraging powerful models such as Claude alongside proprietary real-time telemetry data, will capture a lion’s share of net new security spending catalyzed by AI adoption,” concluded Khan.
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