Shares of cybersecurity and software companies slumped after AI safety and research company Anthropic announced Claude Code on February 20.
Anthropic said that the new capability built into Claude Code and available on the web in a limited research preview, “scans codebases for security vulnerabilities and suggests targeted software patches for human review, allowing teams to find and fix security issues that traditional methods often miss.”
JFrog and the Global X Cybersecurity ETF reacted immediately, posting sharp declines during the session.
Day 1 — Friday, February 20, 2026
Bloomberg reported that NASDAQ-listed cybersecurity and software stocks fell sharply.
JFrog fell 25%
SailPoint fell 9.4%
Okta dropped 9.2%
CrowdStrike and GitLab both fell about 8%
Zscaler dropped 5.5%.
The Global X Cybersecurity ETF fell 4.9% – touching its lowest level since November 2023.
Similarly, NYSE-listed Cloudflare slid 8.1%
Day 2 — Monday, February 23, 2026
Losses deepened across NASDAQ-listed cybersecurity and software stocks (though additional factors may have contributed) as more investors reacted, according to Reuters and CNBC.
Tenable fell 12%, while privately held Netskope was cited by analysts as potentially exposed to similar pressures.
CrowdStrike, Zscaler, and Datadog each fell 11%
SailPoint fell 9%
Fortinet and Okta both declined 6%
Palo Alto Networks fell 3%
The iShares Cybersecurity & Tech ETF (IHAK) dropped 5%
Similarly, NYSE-listed Cloudflare dropped 9.6% and SentinelOne dropped 5%
5 Largest Notable Declines (Feb 20–23)
Across both trading days, five stocks suffered the most:
JFrog: down 25% in a single day
CrowdStrike: down 19% cumulatively across both days
Zscaler: down 16.5% cumulatively across two days of heavy selling.
Tenable: down 12% in a single session on Monday
Cloudflare: down 17.7% cumulatively
Companies with exposure to vulnerability scanning and code security appeared to face heavier selling pressure. JFrog, a code scanning and software supply-chain platform, saw the sharpest decline on day one, CrowdStrike recorded one of the largest cumulative declines across the two sessions, Zscaler experienced sustained selling pressure and Tenable fell sharply in a single session on Monday. Cloudflare continued falling on both Friday and Monday without clear rebound.
The market reaction to Anthropic’s statement was most noticeable in cybersecurity and software stocks amid concerns over potential competitive risks. However, the declines were not uniform across the technology sector. IT services companies experienced more measured moves reflecting uncertainty rather than direct competitive disruption.
The selloff seemed to be driven by fear and panic, not fundamentals. While cybersecurity and software shares fell sharply, IT services companies saw milder moves.
