The Cybersecurity Market Is Back,— But Not for Everyone

Keypoints

• 2025 funding reached $25.1B across 743 deals, with 48 mega-rounds capturing 65% of all funding.
• AI Security captured only 2.6% of funding, while AI is being integrated into Identity, Network, and SOC tooling.
• M&A totaled $76.4B and reflected “The Great Bundling” as IT and non-cyber firms acquired security companies (e.g., Google/Wiz, Palo Alto/CyberArk).
• Europe’s funding grew 81% to $1.33B but represents roughly 5% of global cybersecurity funding and lags significantly in exit value.
• Predictions for 2026 include stealth mega-rounds, few IPOs, and increased investment in offensive/adversarial security capabilities.