The rapid emergence of powerful artificial intelligence (AI) coding agents in the first quarter of 2026 sent shockwaves through thesoftware industry. Investors suddenly found themselves confronting two pressing questions: if AI coding tools enable companies to cost-effectively build and maintain their own internal software, will they begin abandoning Software-as-a-Service (SaaS) subscriptions? And if AI dramatically boosts employee productivity, will organizations need fewer software licenses, ultimately compressing recurring revenue streams?

In our view, these questions are valid. But when it comes to cybersecurity, the implications are far less straightforward—and potentially more constructive—than they appear at first blush. In fact, we believe several key dynamics unleashed by AI are more likely to bolster demand for cybersecurity solutions than disintermediate the industry. Below, we explore these dynamics and assess their implications for the First Trust Nasdaq Cybersecurity ETF (CIBR).

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