As the accessibility and competency of artificial intelligence increases, so do the opportunities for its misuse. In particular, the cyber attack risks posed by AI and its potential for criminal commoditization bring cybersecurity into the spotlight. Furthermore, the British government has issued warnings that the volume and intensity of cyber attacks will increase with AI adoption. While concerning, the combination of current cybersecurity stocks with AI threats to address could prove lucrative.

Moreover, market estimates range from a compound annual growth rate (CAGR) of 9.4% to 13.8%. With a potential size of $500.7 billion by 2030, the cybersecurity market’s growth depends on factors like AI integration and further adoption of the Internet-of-Things. For investors, finding the right companies primed to address the world’s growing cybersecurity needs is critical to successful investing in the sector. Here are three cybersecurity stocks with AI projects that I believe fit the bill for protecting from AI misuse.

Darktrace PLC (DRKTF)

One of the first cybersecurity companies to commit to using AI for good, Darktrace PLC (OTCMKTS:DRKTF) has a bright future ahead. The company offers a cybersecurity platform that uses AI to learn an organization’s standard, day-to-day IT behavior. By gathering this data, the AI can identify network anomalies typical of a cyberattack. Darktrace even claims this service can interrupt ongoing attacks in seconds to counter things like ransomware and phishing.

From a financial standpoint, Darktrace has shown strong revenue growth. Its annual recurring revenue of $545.4 million, reflected a 29.6% increase in FY23. While still in the growth stage and not consistently profitable, the company reported a net income of $52.52 million compared to the smaller profits in 2023. 

In my opinion, a newer company focused on growth, such as Darktrace, could potentially capitalize on the budding cybersecurity industry. Thus, investors should consider it one of the stronger cybersecurity stocks with AI projects on the way.

Crowdstrike (CRWD)

Specializing in cloud security, threat intelligence, and cyberattack response services, Crowdstrike (NASDAQ:CRWD) has been at the forefront of AI-driven growth. The company has found success, especially with its It Falcon Platform product, which offers services for simplifying security operations. The security platform achieves this with a proprietary AI that focuses on establishing endpoint security for the cloud server.

Furthermore, the company has seen significant growth, with a reported revenue $2.241 billion for 2023. CrowdStrike also maintains a robust gross margin among its subscription services. Its record GAAP subscription gross margin for Q1 2024 was 78%, indicating a quality service and model that keeps customers subscribed. As such, the company offsets its customer acquisition costs via the lifetime value those customers provide over time.

These aforementioned trends paint a healthy long-term picture for CRWD stock, as it adapts to the complex protection needs.

Palo Alto Networks (PANW)

A major and well-established player in the cybersecurity industry, Palo Alto Networks (NASDAQ:PANW) shines among cybersecurity stocks with AI ventures. The company offers several products marketed to enterprise-level customers that rely on secure cloud connections. Currently, its core product is a platform that includes advanced firewalls and cloud-based protection, scalable to most companies.

Thanks to a history of solid revenue growth, Palo Alto Networks is considered stable and safer by most analysts. PANW is also the most profitable stock and company on this list, with $1.7 billion in income for Q2 of fiscal 2024. This equates to a price-to-earnings ratio of 44, which is close to the tech sector’s average of 35. These metrics suggest that PANW will continue to grow once it finishes testing its current price ceiling.

I see PANW as one of the more steady stocks to invest in within the cybersecurity sector. That’s because demand for this company’s services will only continue to rise among its established customers as threats increase.

On the date of publication, Viktor Zarev did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.