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Welcome to Thoughts on the Market. I'm Meda Marshall, Morgan Stanley cybersecurity and networking equipment analyst. Today, the future of digital defense against cybercrime It's Friday, September 12, at 10am in New York. Imagine waking up to find your bank account drained, your business operations frozen, or your personal data exposed, all because of a cyber attack. Today, cybersecurity isn't an esoteric tech issue. It impacts all of us, both as consumers and investors. As the digital landscape grows increasingly complex, the scale and severity of cybercrime expand in tandem. This means that even as companies spend more, the risks are multiplying even faster. For investors, this is both a warning and an opportunity. Cybersecurity is now a $270 billion market, and we expect it to grow at 12% per year through 2028. That's one of the fastest growth rates across software. And here's another number worth noting. Chief information officers we surveyed expect cybersecurity spending to continue to grow at 50% faster than software spending as a whole. This makes cybersecurity the most defensive area of IT budgets, meaning it's least likely to be cut even in tough times. This hasn't been lost on investors. Security software has outperformed the broader market, and over the past three years, security stocks have delivered a 58% return, compared to just 22% for software overall and 79% for the NASDAQ. We expect this outperformance against software to continue as AI expands, the number of ways hackers can get in and the ways those threats are evolving. Looking ahead, we see a handful of interconnected mega themes driving investment opportunities in cybersecurity. One of the biggest is platformization, consolidating security tools into a unified platform. Today, major companies juggle, on average, 130 different cybersecurity tools. This approach often creates complexity, not clarity, and can leave dangerous gaps in protection, particularly at the rise of connected devices like robots and drones. Is making a unified security platform more important than ever? And something else to keep in mind? Right now, security investments make up only 1% of overall AI spending, compared to 6% of total IT budgets. So there's a lot of room to grow as AI becomes ever more central to business operations. In today's cybersecurity race, it's not enough to simply pile on more tools or chase the latest buzzwords. We think some of the biggest potential winners are cybersecurity providers who can turn chaos into clarity. In addition to growing revenue and free cash flow, these businesses are weaving together fragmented defenses into unified, easy to manage platforms. They want to get smarter, faster and more resilient, not just bigger. They understand that it's key to cut through the noise, make systems work seamlessly together and adapt on a dime as new threats emerge. In cybersecurity, complexity is the enemy and simplicity is the new superpower. Thanks for listening. If you enjoyed the show, please leave us a review wherever you listen and share thoughts on the market with a friend or colleague today. The preceding content is informational only and based on information available when created. It is not an offer or solicitation, nor is it tax or legal advice. It does not consider your financial circumstances and objectives and may not be suitable for you.