AI the Top Priority for New Spend as Cyber Budgets Flatline

AI is the biggest priority for net-new budget dollars, with around a quarter of US CISOs expecting to aggressively grow their spend year, according to new data from IANS.

The cyber research and advisory firm compiled its 2026 Security Budget Benchmark Report from interviews with 500 security executives nationwide.

AI was by far the most popular area of focus for incremental budget, cited by 69% of respondents. It could be even more, given that other categories such as SecOps automation (51%) and IAM enhancements (39%) are AI-mature areas.

This increase has pushed software to account for 35% of the security budget in 2026, up from 29% last year and just two percentage points behind “staff & compensation”; the closest it’s ever been.

Rather than be a threat to cybersecurity jobs, AI is likely to help the market, IANS claimed.

More than two-thirds (69%) of CISOs said they don’t expect to cut existing headcount due to AI, and 81% anticipate the technology will create demand for new roles and skills.

An overwhelming majority of respondents said the technology is helping teams become more productive (91%), creating a need for new roles (81%), and enabling redeployment to higher value work (79%).

Budgets Stay Flat Overall

However, the AI surge is only one part of the story.

Overall, median growth remained flat, and over half (55%) of respondents kept budgets flat or made cuts due to economic headwinds. This is the second year in a row that IANS has recorded a majority of respondents with flat to negative growth.

“Two organizational factors matter most for budget growth: ownership structure, which shapes an organization’s underlying appetite to invest in security, and financial performance, which determines whether it currently has the resources to act on that appetite,” the report said.

To that end, 71% of VC-backed companies increased security budgets, most often by more than 10%. However, the figure for publicly listed companies was just 52%.

Despite surging investment in AI, security functions still need human team members to “find anomalies, elevate relevant threats and make judgment calls,” argued Steve Martano, IANS faculty member and partner at Artico .

"Organizations that align AI security investments with broader business objectives, establish clear governance, and invest in developing new skills will be better positioned to manage risk while enabling innovation,” he added.

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