Palo Alto Networks to acquire AI security startup Protect AI to strengthen AI defense

Palo Alto Networks is making another big move. The cybersecurity giant announced today that it plans to acquire Protect AI, a fast-rising name in AI and machine learning security.

The news comes a year after Palo Alto Networks acquired IBM’s QRadar cloud software assets as part of the cybersecurity giant’s strategy to expand its customer base and enhance its consultant network.

As part of the deal, Protect AI’s CEO, founders, and team are set to join Palo Alto Networks after the acquisition closes. The transaction, still subject to regulatory approvals and other standard conditions, is expected to wrap up by Palo Alto Networks’ first quarter of fiscal 2026, Palo Alto Networks said in a news release.

The deal, first reported by CNBC, signals Palo Alto Networks’ growing focus on securing AI ecosystems as more companies weave artificial intelligence into their operations. Financial terms weren’t disclosed, but earlier reports pegged the deal’s value between $650 million and $700 million.

“Palo Alto Networks announced on Monday its intent to acquire Protect AI, a startup specializing in securing artificial intelligence and machine learning applications, for an undisclosed sum,” CNBC reported.

Protect AI, launched in 2022, has built a name for itself by tackling a new class of cybersecurity challenges brought on by AI. Its offerings include AI security posture management (AI-SPM), large language model (LLM) security, and GenAI red teaming. Protect AI’s tools help businesses spot and fix vulnerabilities like model manipulation, data poisoning, and prompt injection attacks—threats that traditional security setups aren’t built to handle.

The company has seen a fast rise: 110 employees, $108.5 million in funding, and a string of strategic acquisitions, including SydeLabs for GenAI attack simulation and Huntr for AI-focused bug bounties.

“As AI-powered applications become core to businesses, they bring risks traditional security tools can’t adequately handle. By extending our AI security capabilities to include Protect AI’s innovative solutions for Securing for AI, businesses will be able to build AI applications with comprehensive security. With the addition of Protect AI’s existing portfolio of solutions and team of experts, Palo Alto Networks will be well-positioned to offer a wide range of solutions for customers’ current needs, and also be able to continue innovating on delivering new solutions that are needed for this dynamic threat landscape,” Anand Oswal, SVP and GM at Palo Alto Networks, said.

The Protect AI deal will be Palo Alto Networks’ largest startup acquisition since it bought Expanse for $797.2 million back in 2020. It also lands at a time when the AI cybersecurity market is heating up, projected to reach $102.78 billion by 2032. AI’s dual role—as both a defensive tool and a new attack surface—has opened up a gold rush among security firms.

“Joining forces with Palo Alto Networks will enable us to scale our mission of making the AI landscape more secure for users and organizations of all sizes. We are excited for the opportunity to unite with a company that shares our vision and brings the operational scale and cybersecurity prowess to amplify our impact globally,” Ian Swanson, Co-Founder & CEO, Protect AI, said.

Palo Alto Networks is not alone in this race. Cisco recently scooped up Robust Intelligence for $400 million. AWS, Zscaler, and others are pushing hard, too. Buying Protect AI gives Palo Alto Networks a bigger footprint in securing AI infrastructure, especially around governance, a piece that fits neatly with its AI access, runtime, and inline protection services.

The acquisition, announced alongside the RSA Conference 2025, is expected to close by Palo Alto Networks’ first quarter of fiscal 2026, pending regulatory approval.

For now, as more businesses rush to integrate AI, Palo Alto Networks is making it clear it doesn’t want to be left behind—or leave its customers exposed.