The cybersecurity market further accelerated in the fourth quarter, driven by higher demand for network security products like firewalls and protective tools meant to stop newer types of malware, Bank of America Merrill Lynch said Tuesday.
The total market for network security products in 2018 grew 12.6 percent from a year earlier, according to analysts Scott Casher, Daniel Bartus and Tal Liani. It was "the fourth consecutive quarter of double-digit growth," and "the strongest year since we began tracking the market in 2012," the analysts wrote.
"We expect market strength to continue in 2019," they said.
Total spending on cybersecurity products is expected to exceed $124 billion worldwide, according to Gartner.
The results are driven by a strong market for firewall products, a traditional cybersecurity measure meant to block access to portions of a corporate network from the outside internet. Firewall products showed 16.3 percent growth to $2.4 billion for the fourth quarter of 2018. Advanced threat protection products, which are used to find newer and more sophisticated strains of malicious software, grew to $416 million in the fourth quarter, up 19.1 percent from the year before.
The note indicates stronger growth in the marketplace for products dominated by companies including FireEye, Palo Alto Networks, Cisco, McAfee, Fortinet, Check Point and Huawei than even past bullish analysts had predicted. It also indicates companies are continuing to ramp up their spending on more traditional "perimeter security" products even as they move more corporate data and infrastructure onto cloud services providers.