Cyber startup Cato Networks tops revenue milestone as CEO says AI is helping business

Cato Networks surpassed $350 million in annual recurring revenue in 2025 as more businesses adopted its tools in the age of artificial intelligence, the cybersecurity startup announced Tuesday.CEO Shlomo Kramer told CNBC in an interview that the cloud-based network security provider is benefiting from the AI transformation and has an "aggressive plan" to gain market share in 2026."We are gaining some scale and becoming a more significant player in [the networking security] market," said Kramer, who co-founded Israeli cybersecurity firm Check Point Software and was an early investor in Palo Alto Networks.The milestone reflects 43% year-over-year growth and comes just a few months after Cato said it had topped $300 million in ARR. The metric is used by software companies to track revenue over 12 months.Public cybersecurity names have seen stocks slide as new AI tools built by the likes of Anthropic threaten to upend the sector's business model. Cyber firms have incorporated more AI tools to automate tasks and enhance security protection for customers.Cato has added its own AI tools to monitor and enhance threat protection capabilities and bought AI security startup Aim Security in September, its first acquisition ever.Kramer said AI is a massive tailwind for the company, but he anticipates a correction as businesses reprice the pace of added value from the technology.Cato has raised over $1 billion since its founding in 2015 and is about eight months off a fresh funding round that valued the company at about $4.8 billion.Kramer said the 10-year goal is to be the "CrowdStrike for network security."He did not give a definitive answer about whether or not the company is looking to go public, only saying Cato considers all types of funding.Got a confidential news tip? We want to hear from you.Sign up for free newsletters and get more CNBC delivered to your inboxGet this delivered to your inbox, and more info about our products and services.© 2026 Versant Media, LLC.

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