Fortinet Sees AI, Neocloud Buildout Fueling Network Security Demand

Fortinet sees AI infrastructure as a major cybersecurity demand driver, with enterprises and “neocloud” providers seeking protection for AI data centers, machine-generated traffic, and AI deployments. Neocloud and sovereign AI deployments could provide a growing customer opportunity, particularly as providers build data centers quickly and face data-sovereignty requirements in regions such as Europe. Fortinet is expanding AI visibility, segmentation, SASE and SD-WAN offerings while attaching more subscription services to hardware; management cited strong demand tailwinds but said it is not yet providing 2027 targets.

Fortinet executives said the cybersecurity company sees artificial intelligence as a growing source of demand for network security, particularly as enterprises and emerging “neocloud” providers build AI infrastructure and seek to protect machine-generated traffic. Speaking at the Goldman Sachs Communacopia + Technology Conference, Chief Executive Officer and Co-Founder Ken Xie said Fortinet has developed its own AI models and infrastructure, including global data centers with GPUs, and has launched more than 20 AI-enabled products, primarily in security operations. He said the company’s network-security footprint provides data that helps it analyze global intrusion and attack activity.

Xie said the company sees a broader opportunity in securing AI itself, including enterprise AI deployments, internal network segmentation, and infrastructure operated by AI service providers. “You need to use AI to find or protect the other AI,” Xie said.

Fortinet executives described neocloud providers as a potentially important customer group because they are building AI infrastructure quickly and may require security products as they deploy data centers. Xie said these providers can make purchasing decisions in months rather than years, contrasting them with traditional telecommunications carriers. As AI Data Breaches Become More Common, This Cybersecurity ETF Is Surging He cited an example previously discussed in earnings materials in which a neocloud customer evaluated Fortinet’s offerings and made a purchase during the same quarter, followed by an opportunity that was five to 10 times larger in the subsequent quarter. However, Xie said the market remains at an early stage and that neocloud providers are currently focused more on protecting infrastructure than on securing AI models and applications.

Chief Financial Officer Christiane Ohlgart said Fortinet aims to establish reference architectures early in the deployment process so it can grow alongside neocloud operators as they build data centers. She said midsize neocloud companies could be particularly likely customers because they may not have proprietary security components. Ohlgart also pointed to regulatory requirements around data sovereignty, particularly in Europe, where local companies are building AI infrastructure. She said Fortinet’s technology stack can support sovereign SASE deployments and security for AI clusters operated in environments where local control is mandated.

Xie said recent AI-driven traffic is increasingly occurring in east-west network environments, including within data centers and enterprises. He said machine-to-machine traffic has surpassed human-to-human and human-to-machine traffic across the internet, increasing the need for visibility and control over internal traffic and AI-agent activity.