Cyber Security
CrowdStrike, Datadog Shares Drop After Anthropic Launches AI Security Tool!
Updated on Tue, Feb 24, 2026
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TL;DR
- Anthropic launches Claude Code Security to fix software vulnerabilities.
- Cybersecurity stocks, including CrowdStrike and Datadog, drop sharply.
- Analysts say the selloff may be overdone; tool doesn’t replace real-time security.
The AI startup Anthropic introduced Claude Code Security, a new tool that detects high-severity vulnerabilities in open-source software and suggests patches to fix them.
The announcement triggered a broad selloff across cybersecurity stocks. CrowdStrike, Datadog and Zscaler slid about 11%, while Fortinet and Okta fell around 6%. Palo Alto Networks slipped 3%, and SentinelOne was down roughly 5%.
Investors reacted cautiously amid concerns that expanding AI tools could increase competition for traditional cybersecurity companies. The broader software sector has already faced pressure in recent months as markets assess how quickly AI-driven solutions might reshape existing business models.
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Some analysts argue the reaction may be overdone. As Shrenik Kothari, director, security and infrastructure analyst at Robert W. Baird, said, "What you're seeing today is really the continuation of a panic-driven, narrative-led selloff."
He emphasized that Claude Code Security does not handle real-time security tasks such as detecting live intrusions, stopping attacks in progress or managing compiled software components in production. Those remain core capabilities of established cybersecurity providers.
In a separate development, NVIDIA said it has partnered with Akamai, Forescout, Palo Alto Networks, Xage Security and Siemens to enhance real-time cybersecurity for industrial control systems. This shows that AI and cybersecurity are increasingly evolving together rather than replacing one another outright.
First published on Tue, Feb 24, 2026
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