This is not the first time we have made adjustments; for example, in 2023 we introduced the Layer 8 theme focused on human risk. Today, to reflect the latest developments in the cybersecurity landscape – particularly the maturation of cloud security and the rapid rise of artificial intelligence—we have once again made updates to the index’s key cybersecurity themes (Figure 1a and Figure 1b).

Figure 1a: Exposure of Companies across Cyber Themes in the WisdomTree Team8 Cybersecurity Index

Figure 1b: Description of Cyber Themes in the WisdomTree Team8 Cybersecurity Index

Retiring the Cloud Security Theme

The Cloud Security theme was originally designed to capture companies focused on protecting cloud infrastructure and environments. This included technologies such as Cloud Workload Protection Platforms (CWPP), Cloud Infrastructure Entitlement Management (CIEM), Cloud Security Posture Management (CSPM), SaaS Security Posture Management (SSPM), Cloud-Native Application Protection Platforms (CNAPP), Container Security, and Cloud Access Security Brokers (CASB).

However, as cloud adoption has become universal across enterprises, cloud security capabilities have also become widely embedded across the cybersecurity landscape. Today, most cybersecurity vendors offer products that address cloud environments in some capacity. As a result, in our view, cloud security is no longer a meaningful differentiator between cybersecurity vendors, nor does it serve as a strong proxy for identifying companies aligned with emerging cybersecurity growth themes. Reflecting this shift, the Cloud Security theme is being retired as a distinct category within the index.

While the Cloud Security theme is being discontinued, the index introduces AI Security as the next cybersecurity theme, driven by the rapid adoption of AI systems, the expansion of the AI attack surface, and the emergence of specialized AI security solutions.

Introducing AI Security as a Distinct Cybersecurity Theme

Artificial intelligence is rapidly becoming embedded across enterprise software, infrastructure, and workflows. While AI is transforming productivity and enabling new capabilities spanning industries, it is also introducing new security risks and attack surfaces that create unique opportunities for attackers. Several major drivers are accelerating the evolution of the AI security market:

Explosion in the Adoption of AI Systems

Enterprises are rapidly deploying AI tools across software development, knowledge management, customer support, and internal workflows. What began as experimentation with generative AI is increasingly moving into production environments and becoming embedded in core enterprise software systems. Organizations are also beginning to deploy AI agents capable of autonomously interacting with applications, data sources, and external systems, further expanding the operational role of AI within enterprise environments.

New Attack Surfaces in AI Infrastructure

Since AI systems rely on data pipelines, training environments, model repositories and inference infrastructure, each component represents a potential entry point for attackers. Moreover, the growing use of AI agents introduces new security considerations that make them attractive targets. As a result, security teams are increasingly confronting risks that did not exist until recently. These risks include manipulation attacks, where adversaries craft malicious inputs to bypass safeguards or produce unintended outputs; infection attacks, where attackers poison training data or manipulate model behavior to influence system outputs; and exfiltration attacks, which attempt to extract sensitive information such as training data, model parameters, or proprietary algorithms from AI systems.

Rapid Emergence of Specialized AI Security Solutions

Over the past year, a new generation of security companies has emerged focused specifically on the unique security needs of AI systems and AI-native environments. These solutions are designed to secure AI models and training environments, protect data pipelines and model supply chains, monitor and control AI system behavior, detect vulnerabilities and misuse in AI applications, and enforce governance, compliance, and security controls for enterprise AI deployments.

As these risks and technologies continue to evolve, the cybersecurity market is beginning to recognize AI Security as a distinct category within the broader cybersecurity ecosystem, and for these reasons, the WisdomTree Team8 Cybersecurity Index will now formally recognize AI Security as its own dedicated theme.

Positioning the Index for the Future

The WisdomTree Team8 Cybersecurity Index was designed to track key cybersecurity themes emerging across the industry, and as the industry evolves, so do the key themes shaping its future. By retiring the Cloud Security theme and introducing the AI Security theme, the index continues to reflect key structural developments in the cybersecurity market, helping ensure it remains aligned with the technologies and themes shaping the future of cybersecurity.

Conclusion: How Are Cybersecurity Software Companies Performing in 2026 Relative to the Broader Software Group?

Those investors interested in the strategy defined by the WisdomTree Team8 Cybersecurity Index need to look to the WisdomTree Cybersecurity Fund (WCBR) as the investable vehicle designed to track it. From there, we can look to Figures 2a and 2b to examine what we believe is an important performance-oriented question:

How are cybersecurity software companies, broadly speaking, performing relative to the broader landscape of overall software companies so far in 2026?

Like many others, we are aware of the difficult performance in the software space starting 2026 as the business model is facing challenges from artificial intelligence. Even if we believe that ‘cybersecurity may be different from broader software’ it’s important to look at what is happening in the market to see if the returns are bearing this out.

In Figures 2a and 2b, the iShares Expanded Tech-Software Sector ETF (IGV), which is designed to track the total return performance before fees and expenses of the S&P North America Expanded Technology Software Index, is used to showcase the performance of ‘broader software.’ IGV has gotten significant attention in 2026 as people have been looking at software specifically and, as of March 26, 2026, it had more than $9.7 billion in assets under management.

In Figure 2a, which is through March 26, 2026, we see that IGV is down roughly 24.5% to start 2026, whereas WCBR is down roughly 9.6%. The story that ‘cybersecurity software may be different’ appears to be playing out. We do understand there is a difference between ‘going down less’ and ‘delivering a positive return’, but we believe this significant performance difference is telling us something, and we’ll have to monitor to see if this difference continues.

Figure 2a: Cybersecurity Software vs. Broad Software so far in 2026

Figure 2b: Standardized Performance

We believe that what we are seeing in AI so far in 2026 ultimately could create more demands for different cybersecurity solutions—many of which come through software—and we look forward to continuing to see how this picture plays out.

Figure 3: Additional Information