Palo Alto Networks to acquire Protect AI to lead in AI-native cybersecurity. Explore how this $700M deal is set to boost Prisma AIRS and reshape AI risk management.
Palo Alto Networks, a global leader in cybersecurity, recently announced a definitive agreement to acquire Protect AI, a Seattle-based startup specializing in securing artificial intelligence (AI) and machine learning (ML) systems, for an estimated $500–$700 million. The acquisition, expected to close by the first quarter of fiscal 2026, aims to enhance Palo Alto Networks’ ability to protect AI ecosystems and accelerate the development of its Prisma AIRS platform, a comprehensive AI security solution launched concurrently with the announcement. This strategic move positions Palo Alto Networks at the forefront of AI-native cybersecurity, addressing emerging threats to AI systems critical to enterprise and government operations.
Protect AI: A Leader in MLSecOps
Founded in 2022, Protect AI has established itself as a pioneer in MLSecOps, applying DevSecOps principles to secure ML workflows. The company’s product portfolio addresses vulnerabilities specific to AI and ML systems, including:
NB Defence: Scans Jupyter Notebooks for risky configurations, exposed secrets, and tampered dependencies.
AI Radar: Monitors AI systems in real-time for adversarial attacks and behavioral anomalies.
ModelScan: Identifies vulnerabilities in open-source and proprietary ML models.
Supply Chain Audits: Validates the integrity of third-party pretrained models and pipelines.
ML Asset Inventory: Maps and tracks ML models across environments, enforcing automated risk policies.
Protect AI’s tools mitigate threats such as model poisoning, prompt injection, adversarial attacks, and supply chain compromises. With a $60 million Series B funding round in 2024 and a valuation of $400 million, Protect AI has been a key competitor to startups like Prompt Security, Lasso, and Apex. Its team, including CEO Ian Swanson, President Daryan Dehghanpisheh, and CTO Badar Ahmed, is expected to join Palo Alto Networks post-acquisition.
Strategic Synergies
The acquisition aligns with Palo Alto Networks’ strategy to address the evolving cybersecurity landscape, where AI systems introduce new attack surfaces that traditional tools cannot adequately protect. Key motivations include:
First-Mover Advantage in AI Security: By integrating Protect AI’s expertise, Palo Alto Networks strengthens its leadership in securing AI models, applications, and data. This move differentiates it from competitors like CrowdStrike, Zscaler, and Fortinet, who have yet to focus extensively on model-level protection.
Enhancement of Prisma AIRS: The newly launched Prisma AIRS platform provides end-to-end AI security, covering risk assessment, model scanning, runtime security, posture management, and AI agent security. Protect AI’s technology, such as its Recon tool, which tests AI workloads for vulnerabilities using a library of 450 attack patterns, will accelerate Prisma AIRS development.
Integration with Existing Platforms: Protect AI’s capabilities will enhance Palo Alto Networks’ Cortex XSIAM and Prisma Cloud. Cortex XSIAM will incorporate real-time model anomaly detection for security operations centers (SOCs), while Prisma Cloud will embed ML-specific security checks into CI/CD pipelines and infrastructure-as-code (IaC) frameworks.
Market and Regulatory Alignment: The acquisition responds to macro trends, including the EU AI Act and U.S. Executive Orders mandating AI security audits and provenance tracking. The rise of large language models (LLMs) and nation-state cyberattacks targeting AI systems further underscores the need for specialized defences.
Technical Implications
The integration of Protect AI’s solutions into Palo Alto Networks’ ecosystem will enable organizations to secure AI systems across their lifecycle.
Key technical benefits include:
Model Integrity and Auditing: ModelScan and Supply Chain Audits will detect backdoors, malware, and vulnerabilities in pretrained models, ensuring compliance with regulatory requirements for model provenance and red-teaming.
Runtime Protection: AI Radar’s real-time monitoring will defend against prompt injection, malicious code, data leaks, and hallucination exploits in LLM-powered applications.
Zero-Trust for AI: ML Asset Inventory will provide visibility into AI deployments, enabling Chief Information Officers to enforce zero-trust policies for model access and usage.
Adversarial Defence: Tools like Recon will identify and mitigate adversarial inputs that could manipulate AI predictions, critical for high-stakes applications in finance, healthcare, and defence.
Market and Industry Impact
The acquisition signals a shift in the cybersecurity industry toward AI-native defences. Enterprises will benefit from integrated AI security controls that allow data science teams to innovate without compromising security. Governments will gain tools to audit and protect national AI infrastructure, particularly in defence and public services. Cloud providers and SaaS vendors may see new partnership opportunities as Palo Alto Networks expands its AI security APIs.
The deal also reflects the growing importance of AI security, with nearly three-fourths of companies reporting AI-related breaches in 2024. By acquiring Protect AI, Palo Alto Networks addresses a critical gap in the market, positioning itself as a leader in a sector projected to see significant consolidation.
Financial Details
While the exact acquisition amount remains undisclosed, industry sources estimate the deal at $500–$700 million, a premium over Protect AI’s $400 million valuation in 2024. Palo Alto Networks, with a market capitalization of approximately $120 billion and strong cash flows, is well-positioned to fund this acquisition. The company reported a 14.1% year-over-year revenue increase to $4.4 billion in the first half of fiscal 2025, with free cash flow of nearly $2 billion, supporting its capacity for strategic investments.
Palo Alto Networks’ acquisition of Protect AI is a strategic move to lead the AI cybersecurity market. By integrating Protect AI’s MLSecOps expertise with its Prisma AIRS platform and existing solutions, Palo Alto Networks addresses the urgent need to secure AI systems against emerging threats. This acquisition not only enhances its technical capabilities but also positions it as a trusted partner for enterprises, governments, and cloud providers navigating the AI-driven future of cybersecurity.
