NASDAQ cybersecurity stocks: Digital safety investments from India
Cybercriminals launched 4,737 ransomware attacks in 2025 alone. AI now powers 80% of those attacks. Global cybersecurity spending will reach $240 billion in 2026, growing 12.5% year over year, according to Gartner. This rapid acceleration creates a compelling opportunity for Indian investors watching NASDAQ cybersecurity stocks in India.
Four pure-play platforms dominate this sector on NASDAQ. Palo Alto Networks, CrowdStrike, Fortinet, and Zscaler collectively generate over $24 billion in annual revenue. Each company grows by 14%-26% annually. Early 2026 has seen a sharp software selloff, pulling these stocks 25–47% below their recent highs. That pullback sets the stage for a closer look at each company.
Why digital security spending keeps rising
Enterprise AI tool usage surged over 3,000% in the first half of 2025. Autonomous AI agents now outnumber human users 82 to 1 in corporate environments. Every new AI tool, cloud workload, and connected device expands the attack surface that companies must defend. Digital security spending reflects this reality directly.
Regulatory pressure adds a second growth engine. The EU's NIS2 Directive enters active enforcement in April 2026. DORA has governed financial entities since January 2025, with fines reaching 2% of global turnover. The EU Cyber Resilience Act introduces incident-reporting requirements in 2026. By mid-2026, over 80% of global enterprises will fall under some form of cybersecurity governance. These mandates turn security budgets from discretionary spending into compliance requirements.
Gartner projects this market will reach $322 billion by 2029 at a 10% compound annual growth rate. McKinsey estimates the total addressable market at $2 trillion. The fastest-growing segments include cloud-native application protection, identity security, SASE, and the emerging AI security category.
Palo Alto Networks: the platform builder
Palo Alto Networks (PANW) trades near $155 in early February 2026, with a market cap of approximately $114 billion. The company reported Q1 FY2026 revenue of $2.47 billion, up 16% year over year. Free cash flow reached $1.71 billion, delivering a remarkable 69% margin.
The critical growth metric is Next-Generation Security's annual recurring revenue. NGS ARR hit $5.85 billion in Q1, growing 29% yearly. Management raised the FY2030 NGS ARR target from $15 billion to $20 billion. The SASE business alone generates over $1.3 billion in ARR and grows 34% annually.
Two major acquisitions shape the current thesis. A $25 billion CyberArk deal fills identity security gaps and awaits regulatory approval. The $3.35 billion acquisition of Chronosphere, completed in January 2026, adds observability capabilities. A multibillion-dollar Google Cloud partnership, projected to reach $10 billion over several years, validates the platform strategy.
Analysts hold a Strong Buy consensus with an average price target of $229. That implies roughly 48% upside from current levels. Q2 FY2026 earnings arrive on February 17, 2026.
CrowdStrike: resilience after the storm
CrowdStrike (CRWD) trades between $415 and $440 with a market cap of nearly $100 billion. Comparing CrowdStrike Palo Alto side by side reveals two distinct approaches to platform dominance. Where Palo Alto acquires capability, CrowdStrike builds natively on its Falcon platform.
Q3 FY2026 revenue reached $1.23 billion, up 22% yearly. Net new ARR hit a record $265 million, growing 73% year over year. Ending ARR stands at $4.92 billion. Seven individual Falcon modules each exceed $300 million in ARR, proving the multi-product strategy works.
The July 2024 outage that affected 8.5 million Windows devices is fully behind the company. CrowdStrike maintained 97% gross retention throughout the crisis. A January 2026 court ruling dismissed the related lawsuit entirely. The Falcon Flex subscription model has emerged as a powerful growth engine, with over $1.35 billion in ARR and a 200% annual growth rate.
Analysts rate CrowdStrike as a Strong Buy with a $551 average price target. Morningstar values the stock at $725. The primary concern remains valuation at roughly 95 times forward earnings. Q4 FY2026 results arrive on March 10, 2026.
Fortinet: the firewall king pivots to SASE
Fortinet (FTNT) trades near $79 with a market cap of roughly $59 billion. Fresh Q4 2025 results reported on February 5, 2026, beat expectations across all metrics. Revenue reached $1.91 billion, up 15% year over year. Full-year 2025 revenue hit $6.80 billion with free cash flow of $2.21 billion.
A detailed analysis of Fortinet and Zscaler reveals fundamentally different business models. Fortinet owns hardware and software across firewalls, switches, and SASE. Zscaler operates a pure cloud platform. Fortinet commands 55% of the unit firewall market, giving it the industry's largest installed base.
Unified SASE billings grew 40% in Q4 2025. FortiSASE billings surged by more than 100% in Q3. Fortinet holds over 500 AI patents and earned Leader status in both the 2025 Gartner Magic Quadrant for SASE and Hybrid Mesh Firewalls. A firewall refresh cycle covering 650,000 units reaching the end of support by late 2026 provides an additional tailwind.
FY2026 guidance calls for $7.50 to $7.70 billion in revenue, representing roughly 12% growth. Analyst consensus rates Fortinet as Hold with a $90 average price target.
Zscaler: zero trust at a steep discount
Zscaler (ZS) trades between $169 and $180, down a striking 47% from its November 2025 high. This makes it the most discounted cybersecurity stock relative to analyst targets. Q1 FY2026 revenue reached $788 million, up 26% year over year, accelerating from 21% growth in the prior quarter.
The company processes over 500 billion daily transactions through its Zero Trust Exchange. More than 45% of Fortune 500 companies use Zscaler. The company earned Leader status in the Gartner Magic Quadrant for Security Service Edge for the fourth consecutive year.
AI Security has become a breakout growth pillar. This segment exceeded $400 million in ARR three quarters ahead of schedule, growing by over 80% year over year. Zscaler expects it to surpass $500 million by fiscal year-end. Recent acquisitions, including Red Canary for $675 million and SquareX, reinforce the AI security strategy.
Analyst consensus is Buy with an average target near $320, implying roughly 80% upside. That gap between price and target rarely exists for a company of this quality. Q2 FY2026 earnings arrive on February 19, 2026Cybersecurityty ETF options for diversified exposure
Investors seeking diversified exposure can choose from several cybersecurity ETFs listed on the NASDAQ. Here is how the leading options compare.
CIBR from First Trust leads with $11.1 billion in assets and a 0.59% expense ratio. It returned 13–14.5% in 2025 and offers the best liquidity. However, its broad definition includes IT services firms such as Infosys and Broadcom, which dilutes the pure cybersecurity exposure.
HACK from Amplify manages $2.2 billion with a 0.60% expense ratio. It returned 10–12.5% in 2025. As the oldest cybersecurity ETF in this space, launched in 2014, it carries roughly 10.5% exposure to defence contractors.
BUG from Global X holds $826 million with the lowest major-fund expense ratio at 0.51%. It requires companies to earn 50% of revenue from cybersecurity. This makes BUG the purest play but also the most volatile. BUG declined 5.19% in 2025 due to a lack of diversified names that helped CIBR.
IHAK from iShares has $743 million in assets under management and charges the lowest fee among major funds at 0.47%. It offers the most globally diversified portfolio. All these ETFs have declined an estimated 5–10% in early 2026 during the broader software selloff.
For maximum cybersecurity concentration, BUG stands out. For stability and liquidity, CIBR remains the default choice. Indian investors can buy all these ETFs directly through platforms that support U.S. market access.
risks that every investor should weigh
Valuation tops the risk list among NASDAQ cybersecurity stocks. CrowdStrike trades at roughly 95 times forward earnings. Palo Alto Networks commands 47 times normalized earnings. Zscaler trades at 61x forward earnings. Any growth deceleration could trigger sharp selloffs, as Zscaler's 47% decline from November proves.
Budget fatigue has emerged as a genuine concern. Cybersecurity budgets grew only 4% in 2025, down from 8% the prior year. As a share of IT budgets, cyber spending declined from 11.9% to 10.9%, breaking a five-year upward trend.
Platform consolidation creates winners and losers simultaneously. Gartner predicts 70% of organizations will consolidate to a maximum of three security vendors by 2026. The 2025 M&A wave totalled $84 billion, with Google's $32 billion acquisition of Wizn. This benefits large platforms but introduces integration risk.
Microsoft generated $37 billion in cybersecurity revenue in FY2025. Hyperscaler bundling poses a real competitive threat to standalone security companies. The early 2026 software selloff was partly triggered by fears that AI agents could commoditize traditional security products.
What Indian investors need to know
Indian residents can invest in all four stocks and cybersecurity ETFs through the Liberalised Remittance Scheme. The LRS maintains an annual limit of $250,000 per individual, unchanged for FY2026-27.
Long-term capital gains on U.S. stocks held for more than 24 months are taxed at a flat 12.5% rate without indexation. Short-term gains are taxed at your income tax slab rate. U.S. dividends are subject to 25% withholding at source under the India-US DTAA. You can claim this as a Foreign Tax Credit by filing Form 67 with your ITR. For a complete breakdown of these rules, refer to this guide on tax implications for Indian residents investing in U.S. stocks.
Tax Collected at Source on overseas investment remittances is zero up to ₹10 lakh per financial year and 20% above that threshold. This TCS is fully refundable when you file your income tax return.
A critical risk that many overlook is the U.S. estate tax. Non-resident aliens holding U.S. assets above $60,000 face an estate tax of up to 40%. No India-US estate tax treaty exists. Investors with significant U.S. holdings should explore Ireland-domiciled ETFs or GIFT City alternatives.
Platforms such as Winvesta, INDmoney, Vested Finance, and Interactive Brokers provide direct access to U.S. markets for Indian investors. Since SEBI's $7 billion overseas mutual fund cap has forced most NASDAQ-100 index funds to suspend fresh investments, direct stock purchases through LRS offer a more accessible route. If you need a step-by-step walkthrough, this complete guide on investing in NASDAQ from India covers platform selection, documentation, and LRS procedures.
All foreign assets must be disclosed in Schedule FA of your ITR, regardless of whether gains were realised. Non-disclosure attracts penalties under the Black Money Act.
Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.
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Cybercriminals launched 4,737 ransomware attacks in 2025 alone. AI now powers 80% of those attacks. Global cybersecurity spending will reach $240 billion in 2026, growing 12.5% year over year, according to Gartner. This rapid acceleration creates a compelling opportunity for Indian investors watching NASDAQ cybersecurity stocks in India.
Four pure-play platforms dominate this sector on NASDAQ. Palo Alto Networks, CrowdStrike, Fortinet, and Zscaler collectively generate over $24 billion in annual revenue. Each company grows by 14%-26% annually. Early 2026 has seen a sharp software selloff, pulling these stocks 25–47% below their recent highs. That pullback sets the stage for a closer look at each company.
Why digital security spending keeps rising
Enterprise AI tool usage surged over 3,000% in the first half of 2025. Autonomous AI agents now outnumber human users 82 to 1 in corporate environments. Every new AI tool, cloud workload, and connected device expands the attack surface that companies must defend. Digital security spending reflects this reality directly.
Regulatory pressure adds a second growth engine. The EU's NIS2 Directive enters active enforcement in April 2026. DORA has governed financial entities since January 2025, with fines reaching 2% of global turnover. The EU Cyber Resilience Act introduces incident-reporting requirements in 2026. By mid-2026, over 80% of global enterprises will fall under some form of cybersecurity governance. These mandates turn security budgets from discretionary spending into compliance requirements.
Gartner projects this market will reach $322 billion by 2029 at a 10% compound annual growth rate. McKinsey estimates the total addressable market at $2 trillion. The fastest-growing segments include cloud-native application protection, identity security, SASE, and the emerging AI security category.
Palo Alto Networks: the platform builder
Palo Alto Networks (PANW) trades near $155 in early February 2026, with a market cap of approximately $114 billion. The company reported Q1 FY2026 revenue of $2.47 billion, up 16% year over year. Free cash flow reached $1.71 billion, delivering a remarkable 69% margin.
The critical growth metric is Next-Generation Security's annual recurring revenue. NGS ARR hit $5.85 billion in Q1, growing 29% yearly. Management raised the FY2030 NGS ARR target from $15 billion to $20 billion. The SASE business alone generates over $1.3 billion in ARR and grows 34% annually.
Two major acquisitions shape the current thesis. A $25 billion CyberArk deal fills identity security gaps and awaits regulatory approval. The $3.35 billion acquisition of Chronosphere, completed in January 2026, adds observability capabilities. A multibillion-dollar Google Cloud partnership, projected to reach $10 billion over several years, validates the platform strategy.
Analysts hold a Strong Buy consensus with an average price target of $229. That implies roughly 48% upside from current levels. Q2 FY2026 earnings arrive on February 17, 2026.
CrowdStrike: resilience after the storm
CrowdStrike (CRWD) trades between $415 and $440 with a market cap of nearly $100 billion. Comparing CrowdStrike Palo Alto side by side reveals two distinct approaches to platform dominance. Where Palo Alto acquires capability, CrowdStrike builds natively on its Falcon platform.
Q3 FY2026 revenue reached $1.23 billion, up 22% yearly. Net new ARR hit a record $265 million, growing 73% year over year. Ending ARR stands at $4.92 billion. Seven individual Falcon modules each exceed $300 million in ARR, proving the multi-product strategy works.
The July 2024 outage that affected 8.5 million Windows devices is fully behind the company. CrowdStrike maintained 97% gross retention throughout the crisis. A January 2026 court ruling dismissed the related lawsuit entirely. The Falcon Flex subscription model has emerged as a powerful growth engine, with over $1.35 billion in ARR and a 200% annual growth rate.
Analysts rate CrowdStrike as a Strong Buy with a $551 average price target. Morningstar values the stock at $725. The primary concern remains valuation at roughly 95 times forward earnings. Q4 FY2026 results arrive on March 10, 2026.
Fortinet: the firewall king pivots to SASE
Fortinet (FTNT) trades near $79 with a market cap of roughly $59 billion. Fresh Q4 2025 results reported on February 5, 2026, beat expectations across all metrics. Revenue reached $1.91 billion, up 15% year over year. Full-year 2025 revenue hit $6.80 billion with free cash flow of $2.21 billion.
A detailed analysis of Fortinet and Zscaler reveals fundamentally different business models. Fortinet owns hardware and software across firewalls, switches, and SASE. Zscaler operates a pure cloud platform. Fortinet commands 55% of the unit firewall market, giving it the industry's largest installed base.
Unified SASE billings grew 40% in Q4 2025. FortiSASE billings surged by more than 100% in Q3. Fortinet holds over 500 AI patents and earned Leader status in both the 2025 Gartner Magic Quadrant for SASE and Hybrid Mesh Firewalls. A firewall refresh cycle covering 650,000 units reaching the end of support by late 2026 provides an additional tailwind.
FY2026 guidance calls for $7.50 to $7.70 billion in revenue, representing roughly 12% growth. Analyst consensus rates Fortinet as Hold with a $90 average price target.
Zscaler: zero trust at a steep discount
Zscaler (ZS) trades between $169 and $180, down a striking 47% from its November 2025 high. This makes it the most discounted cybersecurity stock relative to analyst targets. Q1 FY2026 revenue reached $788 million, up 26% year over year, accelerating from 21% growth in the prior quarter.
The company processes over 500 billion daily transactions through its Zero Trust Exchange. More than 45% of Fortune 500 companies use Zscaler. The company earned Leader status in the Gartner Magic Quadrant for Security Service Edge for the fourth consecutive year.
AI Security has become a breakout growth pillar. This segment exceeded $400 million in ARR three quarters ahead of schedule, growing by over 80% year over year. Zscaler expects it to surpass $500 million by fiscal year-end. Recent acquisitions, including Red Canary for $675 million and SquareX, reinforce the AI security strategy.
Analyst consensus is Buy with an average target near $320, implying roughly 80% upside. That gap between price and target rarely exists for a company of this quality. Q2 FY2026 earnings arrive on February 19, 2026Cybersecurityty ETF options for diversified exposure
Investors seeking diversified exposure can choose from several cybersecurity ETFs listed on the NASDAQ. Here is how the leading options compare.
CIBR from First Trust leads with $11.1 billion in assets and a 0.59% expense ratio. It returned 13–14.5% in 2025 and offers the best liquidity. However, its broad definition includes IT services firms such as Infosys and Broadcom, which dilutes the pure cybersecurity exposure.
HACK from Amplify manages $2.2 billion with a 0.60% expense ratio. It returned 10–12.5% in 2025. As the oldest cybersecurity ETF in this space, launched in 2014, it carries roughly 10.5% exposure to defence contractors.
BUG from Global X holds $826 million with the lowest major-fund expense ratio at 0.51%. It requires companies to earn 50% of revenue from cybersecurity. This makes BUG the purest play but also the most volatile. BUG declined 5.19% in 2025 due to a lack of diversified names that helped CIBR.
IHAK from iShares has $743 million in assets under management and charges the lowest fee among major funds at 0.47%. It offers the most globally diversified portfolio. All these ETFs have declined an estimated 5–10% in early 2026 during the broader software selloff.
For maximum cybersecurity concentration, BUG stands out. For stability and liquidity, CIBR remains the default choice. Indian investors can buy all these ETFs directly through platforms that support U.S. market access.
risks that every investor should weigh
Valuation tops the risk list among NASDAQ cybersecurity stocks. CrowdStrike trades at roughly 95 times forward earnings. Palo Alto Networks commands 47 times normalized earnings. Zscaler trades at 61x forward earnings. Any growth deceleration could trigger sharp selloffs, as Zscaler's 47% decline from November proves.
Budget fatigue has emerged as a genuine concern. Cybersecurity budgets grew only 4% in 2025, down from 8% the prior year. As a share of IT budgets, cyber spending declined from 11.9% to 10.9%, breaking a five-year upward trend.
Platform consolidation creates winners and losers simultaneously. Gartner predicts 70% of organizations will consolidate to a maximum of three security vendors by 2026. The 2025 M&A wave totalled $84 billion, with Google's $32 billion acquisition of Wizn. This benefits large platforms but introduces integration risk.
Microsoft generated $37 billion in cybersecurity revenue in FY2025. Hyperscaler bundling poses a real competitive threat to standalone security companies. The early 2026 software selloff was partly triggered by fears that AI agents could commoditize traditional security products.
What Indian investors need to know
Indian residents can invest in all four stocks and cybersecurity ETFs through the Liberalised Remittance Scheme. The LRS maintains an annual limit of $250,000 per individual, unchanged for FY2026-27.
Long-term capital gains on U.S. stocks held for more than 24 months are taxed at a flat 12.5% rate without indexation. Short-term gains are taxed at your income tax slab rate. U.S. dividends are subject to 25% withholding at source under the India-US DTAA. You can claim this as a Foreign Tax Credit by filing Form 67 with your ITR. For a complete breakdown of these rules, refer to this guide on tax implications for Indian residents investing in U.S. stocks.
Tax Collected at Source on overseas investment remittances is zero up to ₹10 lakh per financial year and 20% above that threshold. This TCS is fully refundable when you file your income tax return.
A critical risk that many overlook is the U.S. estate tax. Non-resident aliens holding U.S. assets above $60,000 face an estate tax of up to 40%. No India-US estate tax treaty exists. Investors with significant U.S. holdings should explore Ireland-domiciled ETFs or GIFT City alternatives.
Platforms such as Winvesta, INDmoney, Vested Finance, and Interactive Brokers provide direct access to U.S. markets for Indian investors. Since SEBI's $7 billion overseas mutual fund cap has forced most NASDAQ-100 index funds to suspend fresh investments, direct stock purchases through LRS offer a more accessible route. If you need a step-by-step walkthrough, this complete guide on investing in NASDAQ from India covers platform selection, documentation, and LRS procedures.
All foreign assets must be disclosed in Schedule FA of your ITR, regardless of whether gains were realised. Non-disclosure attracts penalties under the Black Money Act.
Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.
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Invest in 11,000+ US stocks & ETFs
