Palo Alto Networks will purchase IBM QRadar cloud safety software program belongings

Palo Alto Networks is shopping for cloud safety software program belongings from IBM as a part of a broader partnership that can give the cybersecurity firm entry to extra consultants and a much bigger buyer base.

In a joint press launch, the businesses stated Palo Alto is buying IBM’s QRadar cloud software program for an undisclosed sum and migrating present prospects to its safety platform, Cortex Xsiam. IBM will practice greater than 1,000 of its consulting staff on Palo Alto’s merchandise.

Consolidation has been ramping up within the safety software program business as firms gear up for a swarm of assaults spawned by synthetic intelligence. In March, Cisco closed its $28 billion acquisition of Splunk, the networking firm’s largest deal ever, snapping up the main supplier of safety info and occasion administration (SIEM) software program.

Earlier on Wednesday, two different firms within the SIEM market, Exabeam and Thoma Bravo’s LogRhythm, introduced plans to merge.

Nikesh Arora, Palo Alto’s CEO, informed CNBC that his firm must be higher ready to go up towards Splunk.

“Clearly, it is only a hotbed of exercise within the consolidation in cybersecurity,” Arora stated.

Palo Alto and IBM have been working extra carefully collectively for months, and Arora stated he’d been speaking with IBM CEO Arvind Krishna about how one can advance their partnership. However they each offered SIEM software program.

“We used to get caught there,” Arora stated.

In December, IBM said its consulting group would provide Palo Alto’s competing Cortex Xsiam software program to prospects. IBM will now undertake Cortex Xsiam, in addition to Palo Alto’s Prisma Sase 3.0 product bundle. Palo Alto will incorporate IBM’s Watsonx giant language fashions into Cortex Xsiam, along with its use of fashions from Google.

The SIEM class has been round for over 20 years, however Palo Alto simply launched Cortex Xsiam two years in the past. It is quickly gained adoption, with over $90 million in bookings within the newest quarter, and Arora stated the corporate has been taking market share from “everybody.”

For IBM, a extra strong lineup of up to date safety instruments for consulting would possibly assist the corporate ship on its stated goal of income progress within the mid-single digits for 2024. Within the first quarter, income elevated 3%, with a 2% bump within the consulting section.

Palo Alto is rising a lot quicker than IBM. Within the January quarter, income jumped 19%. The corporate will report outcomes for the most recent quarter on Monday.

Palo Alto greater than doubled in worth final yr and its inventory is up 6% yr thus far, lifting the corporate’s market cap previous $100 billion. The inventory rose greater than 1% in prolonged buying and selling. IBM is up shut to five% this yr and is now valued at $154 billion.

The businesses stated the transaction ought to shut by the tip of September, topic to regulatory approval and different circumstances.