CyberArk Software Ltd. (CYBR): PESTLE Analysis [Nov-2025 Updated]

You're looking for a clear, actionable breakdown of the forces shaping CyberArk Software Ltd. (CYBR) right now. As a seasoned analyst, I see the near-term landscape dominated by regulatory pressure and the shift to cloud-delivered identity security. Enterprise IT spending on security is projected to grow by a strong 12% in 2025, but this tailwind is complicated by new SEC cyber disclosure rules and the global push for zero-trust architecture adoption. This PESTLE view maps the critical risks and opportunities, so you can make a defintely informed decision on their trajectory.

CyberArk Software Ltd. (CYBR) - PESTLE Analysis: Political factors

You're looking at CyberArk Software Ltd. (CYBR) right now, and the political landscape isn't just a background factor-it's a primary revenue driver. For a company focused on identity security and Privileged Access Management (PAM), government mandates and escalating global tensions are effectively creating non-discretionary spending for their solutions. This political tailwind is a core reason why the company's full-year 2025 total revenue is projected to be in the range of $1.313 billion to $1.323 billion.

Increased global government scrutiny on critical infrastructure security.

The political focus on protecting critical infrastructure-energy grids, financial systems, and water treatment plants-is a massive opportunity for CyberArk. Following high-profile attacks like the 2021 Colonial Pipeline incident, which cost insurers an estimated $2 billion in losses, governments worldwide have mandated stricter security protocols. This scrutiny forces organizations to secure privileged accounts, which are the keys to their most sensitive systems. CyberArk's identity security platform directly addresses this by enforcing least privilege access, making it a compliance must-have, not just a security nice-to-have. It's a simple equation: the more critical the infrastructure, the more non-negotiable the PAM solution becomes.

U.S. federal contract mandates favor zero-trust architecture adoption.

The U.S. federal government's aggressive push toward a Zero Trust Architecture (ZTA) is a direct, lucrative mandate for CyberArk. Directives like Executive Order (EO) 14028, 'Improving the Nation's Cybersecurity,' and OMB M-22-09 require federal agencies to adopt ZTA principles, with a focus on identity-proofing and least privilege. Privileged Access Management is a foundational pillar of ZTA, which means CyberArk's core product is perfectly positioned to capture this spending. The global Zero Trust market is projected to reach $22.58 billion in 2025, and the U.S. federal sector is a significant, high-margin component of that growth. This is defintely a clear, near-term catalyst.

Here is a quick look at the direct regulatory drivers:

• EO 14028 (May 2021): Mandates federal agencies to advance toward Zero Trust Architecture.
• OMB M-22-09: Provides a specific strategy and roadmap for ZTA implementation.
• AI Security Mandate (Nov 1, 2025): A revised executive order requires federal networks to integrate AI to detect vulnerabilities, which CyberArk supports by securing the vast number of non-human machine identities that underpin AI systems.

Geopolitical tensions drive higher defense and cybersecurity spending.

Geopolitical conflicts, particularly those involving nation-state actors like China, Russia, Iran, and North Korea, are fueling a surge in cyber warfare and, consequently, cybersecurity budgets. The World Economic Forum noted that cyberattacks have surged by 75% since 2022 due to these conflicts, making digital defense a top-tier national security priority. This environment ensures a steady, high level of government and defense spending. Gartner projects worldwide end-user spending on information security to reach $213 billion in 2025, up from $193 billion in 2024, despite some economic headwinds. CyberArk benefits because its solutions protect the very command-and-control systems these state-sponsored groups target.

Here's the quick math on the market impact:

Metric	2024 Value	2025 Projected Value	Growth Driver
Worldwide Information Security Spending	$193 Billion	$213 Billion	Geopolitical tensions, regulatory compliance
Global Zero Trust Market Size	$19.89 Billion	$22.58 Billion	U.S. Federal Mandates (EO 14028, M-22-09)
CyberArk Total Revenue (FY)	$1.001 Billion	$1.313B - $1.323B	Subscription growth, identity security demand

Export controls on sensitive technology impact international sales strategy.

The tightening of U.S. export controls, primarily aimed at restricting technology transfer to strategic rivals, presents a compliance challenge and a strategic risk for CyberArk's international sales. While the most stringent 2025 controls focus on advanced computing items and AI model weights, the political mood favors broadening restrictions on 'critical technologies.' Proposals have been floated to eliminate certain license exceptions and reduce the de minimis threshold (the amount of U.S. content allowed in a foreign-made product before it requires a U.S. license) to as low as 0% for critical tech. For a company with a global footprint, this requires careful segmentation of the market and potentially complex compliance for cloud-based services, especially with proposals like the Remote Access Security Act aiming to close loopholes that allow remote access to controlled U.S. technology from abroad. This complexity adds to the cost of doing business in key international markets.

CyberArk Software Ltd. (CYBR) - PESTLE Analysis: Economic factors

Enterprise IT Spending on Security Projected to Grow by 12% in 2025

The economic backdrop for CyberArk is exceptionally strong, driven by the non-negotiable nature of cybersecurity spending. Honestly, a breach costs far more than prevention, so even in a tight economy, security budgets are protected. Worldwide end-user spending on information security is projected to reach $213 billion in 2025. This massive market size is expected to grow by 12% in 2025, driven by escalating cyber threats, regulatory mandates, and the shift to cloud-based systems. This consistent, double-digit growth creates a powerful tailwind for CyberArk's Identity Security Platform, especially as companies consolidate vendors around critical areas like identity and access management.

Here's the quick math on the security software segment, which is where CyberArk operates: Gartner projects security software spending alone will hit $105.94 billion in 2025. This segment is growing faster than the overall IT market, reflecting a strategic pivot by Chief Information Security Officers (CISOs) to prioritize software-defined defense.

Shift to Subscription-Based Recurring Revenue (SaaS) Stabilizes Cash Flow

CyberArk's successful transition to a subscription-based model is a key economic strength, providing revenue predictability and stability. This shift from one-time perpetual licenses to a Software-as-a-Service (SaaS) model stabilizes cash flow and gives us a clear view of future performance. The company's full-year 2025 Annual Recurring Revenue (ARR) is projected to reach between $1.410 billion and $1.420 billion, representing a robust 21% growth from the prior year.

The subscription portion of ARR is the real story here. As of the third quarter of 2025, the Subscription portion of ARR stood at $1.158 billion, making up 86% of the total ARR. This high percentage of recurring revenue is a strong indicator of business durability, translating directly into healthy cash generation. The full-year 2025 Adjusted Free Cash Flow is expected to be between $300.0 million and $310.0 million. That's defintely a solid financial position.

2025 Financial Metric (Full Year Guidance/Latest Q3 Data)	Amount/Range	Significance
Projected Total Revenue	$1.313 billion to $1.323 billion	Represents 31% to 32% growth year-over-year.
Projected Annual Recurring Revenue (ARR)	$1.410 billion to $1.420 billion	Forecasted 21% growth, showing strong customer adoption.
Subscription ARR (as of Q3 2025)	$1.158 billion	Accounts for 86% of total ARR, indicating model maturity.
Projected Adjusted Free Cash Flow	$300.0 million to $310.0 million	High-margin software model drives significant cash generation.

High Inflation and Interest Rates Pressure Customer Budget Cycles

While the demand for identity security is inelastic, the macroeconomic environment still creates friction in sales cycles. The prevailing 'higher for longer' interest rate environment, coupled with persistent inflation, is a risk factor. What this estimate hides is that corporate customers, particularly those reliant on debt financing, are facing increased capital costs, leading to more scrutiny on new expenditures.

Gartner noted an 'uncertainty pause' that began in the second quarter of 2025, where enterprises strategically suspended net-new spending across various IT sectors. For CyberArk, this means:

• Lengthened sales cycles for large, multi-year deals.
• Increased pressure from customers to prove immediate Return on Investment (ROI).
• Budget increases are often consumed by rising recurrent IT costs due to inflation.

This environment favors platform consolidation-a trend CyberArk is leveraging-as customers prefer fewer, larger, and more strategic vendors to simplify their stack and reduce overall vendor count.

Strong U.S. Dollar Exchange Rate Affects International Revenue Translation

As a global leader with significant international sales, the strength of the U.S. dollar (USD) presents a persistent currency headwind. CyberArk reports its financials in USD, but a substantial portion of its revenue is generated outside the United States in local currencies like the Euro and the British Pound. When a strong USD is used to translate weaker foreign currency sales, the reported USD revenue is lower than it would be otherwise.

To be fair, the strong underlying demand and high growth rates (like the 43% year-over-year revenue growth in Q3 2025) are masking this currency effect. Still, a strong USD acts as a drag on reported top-line growth. This dynamic is a factor in managing international pricing strategies and operational expenses, especially since the company has major operations and R&D in Israel, exposing it to fluctuations in the Israeli Shekel as well.

Next step: Finance: Model a 5% USD appreciation scenario against the Euro and Pound to quantify the potential Q4 2025 revenue headwind by the end of the month.

CyberArk Software Ltd. (CYBR) - PESTLE Analysis: Social factors

You're watching the social fabric of work and digital life fundamentally change, and honestly, it's a gold rush for identity security. The shift isn't just about where people work; it's about how much trust we can place in their digital identities, which is exactly why CyberArk Software Ltd. (CYBR) is positioned so well. Every major social trend-from the hybrid office to the public's fear of having their data stolen-translates directly into a demand for their core solutions.

Persistent remote and hybrid work models expand the identity attack surface.

The move to hybrid work is permanent, but it has shattered the traditional network perimeter. You now have employees accessing mission-critical systems from home Wi-Fi networks and personal devices, and attackers know it. This distributed workforce model has directly expanded the identity attack surface, making credentials the primary target.

Here's the quick math on the risk:

• 78% of organizations reported at least one security incident linked to remote work in 2025.
• The average cost of a remote work-related breach in 2025 rose to $4.56 million.
• 54% of Chief Information Security Officers (CISOs) report a spike in credential theft incidents tied to remote access tools in 2025.

This is a major driver for the adoption of Zero Trust Architecture (ZTA), where 'never trust, always verify' becomes the operating principle for every user, device, and application. CyberArk's Privileged Access Management (PAM) tools are essential here because they secure the most powerful, and therefore most dangerous, accounts across these distributed environments.

Growing public concern over data breaches fuels demand for identity security.

The sheer scale and frequency of data breaches are no longer just an IT problem; they are a public trust crisis. When a breach happens, the first thing people worry about is identity theft. This heightened public awareness creates a social mandate for corporations to prioritize security spending, especially around the data that enables identity fraud, like Social Security Numbers and credentials.

The financial stakes are astronomical, which is what gets the board's attention. Global cybercrime costs are projected to reach an astounding $10.5 trillion annually by 2025. Moreover, the Identity Theft Resource Center reported 1,732 data compromises in the first half of 2025 alone, affecting over 165.7 million individuals. When a single vendor breach, like the one involving TransUnion in 2025, exposes the sensitive data of over 4.4 million Americans, the social pressure on every company to secure its supply chain and third-party access becomes defintely non-negotiable.

Shortage of skilled cybersecurity professionals increases reliance on automation.

The global talent gap in cybersecurity is a critical social factor that CyberArk's technology helps solve. Companies simply cannot hire enough experts to keep up with the volume and sophistication of threats.

The latest data shows the world needs an additional 4.8 million cybersecurity professionals to meet current demand. This massive shortage means that security teams, already stretched thin, are forced to look for ways to automate their defense. You can't hire your way out of this problem, so you have to automate.

This reality drives the need for sophisticated automation in identity governance and threat detection. In fact, 94% of organizations are planning to adopt AI-driven identity technologies in 2025 to enhance automation, threat detection, and the management of non-human identities. This shift directly benefits CyberArk, whose platform is designed to automate the lifecycle management and monitoring of privileged access, reducing the manual burden on understaffed Security Operations Centers (SOCs).

Corporate digital transformation initiatives prioritize cloud identity management.

Digital transformation (DT) is the single largest spending priority for many enterprises, with global spending predicted to reach $2.8 trillion by 2025. The foundation of nearly all DT initiatives is the move to the cloud, and in the cloud, identity is the new perimeter.

This shift means that securing cloud identities-human and machine-is no longer a secondary project; it is a top-tier corporate priority. The global cloud security market is projected to reach $37.4 billion by 2025, showing where the capital is flowing. Managing identities and entitlements in the cloud is now a top Identity and Access Management (IAM) priority for organizations. This is why 78% of organizations plan to increase their identity security spending in 2025.

This table illustrates the direct link between social/corporate trends and the demand for CyberArk's core product areas as of the 2025 fiscal year:

Social/Corporate Trend	2025 Key Metric	CyberArk Solution Alignment
Hybrid Work Risk	Average cost of remote work-related breach: $4.56 million.	Privileged Access Management (PAM) and Zero Trust Access to secure remote credentials.
Cybersecurity Talent Shortage	Global shortage of cybersecurity professionals: 4.8 million.	Identity Automation and AI-driven threat detection to reduce manual workload.
Digital Transformation/Cloud Adoption	Global cloud security market projected to reach $37.4 billion.	Cloud Infrastructure Entitlements Management (CIEM) and Secrets Management.
Public Concern/Breach Impact	Global cybercrime costs projected to reach $10.5 trillion.	Identity Security Platform for holistic defense and regulatory compliance.

CyberArk Software Ltd. (CYBR) - PESTLE Analysis: Technological factors

Dominance of AI/ML in threat detection and behavioral analytics.

The rise of Artificial Intelligence (AI) and Machine Learning (ML) is fundamentally changing the security landscape, and CyberArk is right in the middle of it. The global AI in Cybersecurity market is exploding, projected to be valued at $34.10 billion in 2025 and growing at a Compound Annual Growth Rate (CAGR) of 31.70% through 2032. This isn't just about spotting malware; it's about behavioral analytics-using AI to find the subtle deviations in an identity's normal activity.

CyberArk is responding with its proprietary CORA AI technology, which is a set of governing principles for how they productize machine intelligence across their platform. This is defintely critical because the threat surface is shifting: AI is expected to be the #1 creator of new identities with privileged and sensitive access in 2025. You need AI to secure AI. The challenge is that only 32% of organizations currently have the right identity security controls in place for AI, which creates a huge near-term opportunity for CyberArk.

Expansion beyond Privileged Access Management (PAM) into full Identity Security.

CyberArk has strategically moved past its legacy as a Privileged Access Management (PAM) specialist to become a full Identity Security platform leader. This transition is driven by the reality that identity is now the primary attack surface. This isn't just a marketing pivot; it's a platform re-architecture to secure all identities: human, machine, and even new AI agents. The quick math here is simple: machine identities now vastly outnumber human identities, with a ratio of 82 machine identities for every one human in organizations worldwide. That's a massive, unmanaged risk.

To address this, the company made two significant moves: the $1.54 billion acquisition of Venafi in October 2024 for machine identity management and the $165 million acquisition of Zilla Security in February 2025 for cloud-based identity governance. These acquisitions directly expand the platform's capabilities into areas like Identity Governance & Administration (IGA) and Secrets Management, which are vital for securing cloud workloads and DevOps pipelines. This is how they turn a PAM product into a foundational security layer.

Rapid adoption of cloud-native security platforms (e.g., CyberArk's Identity Security Platform).

The shift to a cloud-native platform model is the engine driving CyberArk's impressive financial performance. Customers are consolidating their identity security spend onto the CyberArk Identity Security Platform, moving away from siloed, on-premises tools. This is evident in the company's Q1 2025 results, where subscription revenue soared 60% year-over-year to $250.6 million. The platform's success is best measured by its Annual Recurring Revenue (ARR), which reached $1.215 billion in Q1 2025, a 50% increase from the prior year.

This cloud-centric approach is necessary because the attack surface is overwhelmingly in the cloud. Shockingly, 61% of organizations still lack identity security controls for their cloud infrastructure and workloads, which is a huge vulnerability. The platform provides privilege controls for identities accessing resources in multi-cloud environments, helping customers manage the operational impact of things like shorter Transport Layer Security (TLS) certificate lifespans, where 72% of security leaders reported at least one certificate-related outage in the past year.

Competition from large platform vendors integrating identity into broader suites.

The biggest technological risk is the competition from hyperscale platform vendors who are integrating identity security into their massive, all-encompassing security suites. Companies like Microsoft (with Entra ID), Amazon Web Services (AWS), and Google Cloud Identity & Access Management (IAM) offer identity features that are often bundled or deeply integrated into their cloud ecosystems.

For example, Microsoft Entra ID is often cited as a top alternative to CyberArk's PAM solutions, leveraging its massive enterprise footprint. This competitive pressure forces pure-play vendors to innovate faster and offer superior, best-of-breed capabilities. CyberArk's ultimate response to this 'platform wars' dynamic was the announcement in July 2025 that it would be acquired by Palo Alto Networks for $24.9 billion. This strategic acquisition aims to combine CyberArk's deep identity expertise with Palo Alto Networks' broader security portfolio, creating a unified, end-to-end AI-era security platform that can directly compete with the largest vendors. The deal is expected to finalize in the second half of Palo Alto Networks' fiscal year 2026.

CyberArk (CYBR) - Key 2025 Technological Metrics	Value / Metric	Strategic Context
Full Year 2025 Revenue Outlook (Midpoint)	$1.318 billion	Indicates strong market demand for the Identity Security Platform.
Full Year 2025 ARR Forecast (Midpoint)	$1.415 billion	Shows high customer commitment to the subscription/cloud model.
Q1 2025 Subscription Revenue Growth (YoY)	60%	Direct evidence of rapid adoption of the cloud-native platform.
Machine-to-Human Identity Ratio (2025)	82:1	Justifies the strategic shift beyond human-centric PAM.
AI in Cybersecurity Market Size (2025)	$34.10 billion	Represents the massive, high-growth market CyberArk's CORA AI targets.
Acquisition Value by Palo Alto Networks (Jul 2025)	$24.9 billion	The ultimate move to counter large platform vendor competition.

Here's the quick list of the platform's core focus areas, showing the expansion:

• Securing human identities (Workforce).
• Protecting machine identities (API keys, certificates).
• Controlling access for AI agents (New privileged users).
• Enforcing Zero Trust across cloud environments.

Next step: Analyze the regulatory landscape to see how new compliance laws are driving this identity security spend.

CyberArk Software Ltd. (CYBR) - PESTLE Analysis: Legal factors

The legal landscape for a company like CyberArk Software Ltd. is less about direct consumer protection and more about the regulatory pressure on its customers, which is defintely a boon for sales. New rules from the SEC, the PCI Security Standards Council (PCI SSC), and even the European Union are forcing enterprises to spend more on identity security to avoid massive fines. It's a compliance-driven tailwind, but it also increases CyberArk's own internal compliance burden, plus, the intellectual property (IP) battles in this high-growth sector are getting fierce.

Stricter enforcement of data privacy laws like GDPR and CCPA updates.

You're seeing regulators move past the initial grace periods and start demanding real, auditable proof of compliance. This is a direct driver for CyberArk's Privileged Access Management (PAM) solutions because they help enforce the principle of least privilege, which is core to data minimization and access control required by these laws. For instance, in the US, the California Privacy Protection Agency (CPPA) finalized new regulations in September 2025 covering cybersecurity audits and risk assessments. They also approved a recent enforcement action, a $1.35 Million settlement with Tractor Supply Company, signaling that they are serious about compliance failures.

Across the Atlantic, the EU is streamlining its General Data Protection Regulation (GDPR) enforcement. The Council of the European Union adopted new rules in November 2025 to strengthen cross-border cooperation among Data Protection Authorities (DPAs). This is a big deal because it harmonizes procedures, sets clearer rights for parties, and, most importantly, establishes a standard maximum duration of 15 months for most complex cross-border investigations. This means faster, more consistent enforcement, which makes the risk of a major fine feel more immediate to multinational corporations-your core customer base.

New SEC rules mandate faster, more detailed cyber incident disclosures.

The Securities and Exchange Commission (SEC) rules on cybersecurity disclosures, which became fully effective in the 2024-2025 period, have fundamentally changed how public companies handle breaches. For a publicly traded company like CyberArk, and for its customers, this is a game-changer. Companies must now disclose any material cybersecurity incident on a Form 8-K within just four business days of determining the incident is material.

The pressure is now on the C-suite and the board. Annual reports (Form 10-K) must detail the company's cyber risk management strategy, board oversight, and even whether the board has relevant cybersecurity expertise. This regulatory hammer is a huge sales catalyst for CyberArk, as its solutions provide the exact audit trails and control mechanisms needed for a defensible disclosure. Non-compliance is expensive: penalties for false or missing disclosures can reach up to $35 million, and the SEC has already issued enforcement orders with fines of up to $4 million. That's a clear incentive to invest in a robust PAM solution.

Industry-specific compliance standards (e.g., PCI DSS 4.0) drive solution upgrades.

Beyond the broad government regulations, industry-specific standards are pushing the needle on security investments. The Payment Card Industry Data Security Standard (PCI DSS) is a prime example. The critical compliance deadline for all 'future-dated' requirements in PCI DSS 4.0 became mandatory on March 31, 2025.

This is a major upgrade. PCI DSS 4.0 introduced 64 new requirements, with 51 of those moving from 'best practice' to mandatory compliance in early 2025. Key changes directly impact CyberArk's market, including the requirement for Multi-Factor Authentication (MFA) for all access into the Cardholder Data Environment (CDE), not just remote access. This drives demand for advanced privileged session management and credential vaulting, which are CyberArk's bread and butter. The standard also puts a much greater emphasis on third-party vendor compliance, meaning your customers must ensure their own service providers are compliant, which is a big opportunity for CyberArk's vendor access solutions.

Intellectual property disputes common in the highly competitive security sector.

The identity security space is a high-stakes, high-growth arena, and intellectual property (IP) litigation is an unavoidable business risk. The global Privileged Access Management (PAM) market is projected to be worth $4.50 billion in 2025, and it's expected to grow at a CAGR of 23.40% to nearly $30 billion by 2034. When that much money is on the table, companies fight tooth and nail over patents and trade secrets.

While CyberArk has not had a recent, major public patent dispute with a direct competitor like BeyondTrust or Delinea in 2025, the risk is constant. The US Patent and Trademark Office (USPTO) even had to implement new security measures in September 2025, requiring mandatory identity verification for all Patent Center users, partly in response to a rise in fraudulent filings and unauthorized access risks. This shows the value and vulnerability of IP in the tech sector. For CyberArk, defending its extensive patent portfolio-especially around core PAM, Secrets Management, and Just-in-Time Access-is a continuous, high-cost legal affair that protects its market leadership.

Here's a quick look at the regulatory deadlines driving the business:

Regulation/Standard	Key 2025 Compliance Deadline/Action	Impact on CyberArk's Market
SEC Cybersecurity Disclosure Rules	Material cyber incidents must be disclosed on Form 8-K within four business days.	Drives demand for real-time monitoring, rapid materiality assessment, and auditable control over privileged accounts.
PCI DSS 4.0	All 51 'future-dated' requirements became mandatory on March 31, 2025.	Mandates Multi-Factor Authentication for all CDE access and continuous security practices, boosting sales for core PAM and MFA products.
GDPR/CCPA Updates	EU Council adopted rules in November 2025 to speed up cross-border enforcement (max 15-month investigation). CCPA finalized new audit regulations in September 2025.	Increases customer urgency to implement least-privilege and data access controls to mitigate risk of major fines.

CyberArk Software Ltd. (CYBR) - PESTLE Analysis: Environmental factors

Growing investor and customer demand for transparent ESG reporting.

You're seeing it everywhere: Environmental, Social, and Governance (ESG) performance is no longer a soft metric; it's a hard financial consideration. For CyberArk Software Ltd., this demand from institutional investors and large enterprise customers is a clear driver of strategy. The market now links strong ESG performance to lower risk and better long-term returns, so transparency is defintely a business imperative.

CyberArk has responded by integrating ESG principles into its strategic decisions, with oversight from the Board of Directors via its Nominating and ESG Committee. This commitment is validated by strong external ratings from key agencies, positioning the company as a top performer in its industry for managing significant ESG risks. Here's the quick look at their standing as of 2024, which informs 2025 investor confidence:

ESG Rating Agency	Rating / Score (2024)	Significance
MSCI	AA	Leader in the industry for managing ESG risks.
Sustainalytics	18.2 (Low Risk)	Low-risk rating, indicating strong management of material ESG issues.
ISS ESG Corporate Rating	PRIME	Positions CyberArk among the top performers in their sector.

Minimal direct operational environmental impact as a software company.

As a pure-play software and Software-as-a-Service (SaaS) provider, CyberArk's direct environmental footprint is inherently small, which is a major advantage. Unlike a manufacturer, their primary consumption comes from office operations and running their IT infrastructure. This low direct impact means their Scope 1 (direct emissions) and Scope 2 (purchased energy) Greenhouse Gas (GHG) emissions are minimal on a global scale.

For context, their verified 2023 total Scope 1 and Scope 2 (Market-based) GHG emissions were only 2,107.42 metric tons of CO2 equivalent (mtCO2e). That's a tiny number for a company with trailing twelve-month revenue of approximately $1.30 billion as of November 2025. This low ratio of emissions-to-revenue is a strong selling point to environmentally-conscious customers and investors. They also hold a Platinum Level Membership in the Green Business Bureau in the US, showing a commitment to internal sustainability efforts.

Focus on reducing data center energy consumption through cloud migration.

The biggest environmental lever for a software company is its data center strategy. CyberArk's ongoing subscription transformation strategy, which shifts customers from on-premises software to their cloud-based Identity Security Platform, is the core of their environmental efficiency. They are actively leveraging the cloud to reduce the environmental impact of data center space.

This cloud migration is smart because it outsources the massive energy consumption of physical data centers to hyper-scale cloud providers like Amazon Web Services (AWS) and Microsoft Azure. Here's the quick math on the benefit:

• Cloud computing is up to 93% more energy-efficient than typical on-premises data centers.
• Migrating workloads to the cloud can reduce energy use by nearly 80% compared to operating private data centers.
• This shift drastically cuts the energy needed for power, cooling, and hardware refresh cycles.

This is a clear, actionable step that lowers their environmental impact while simultaneously supporting the business model shift to SaaS.

Supply chain (cloud providers) environmental policies affect vendor selection.

While their direct emissions are low, the environmental policies of their third-party cloud providers-their primary supply chain for SaaS delivery-become a critical Scope 3 (indirect emissions) risk and opportunity. As CyberArk expands its measurement to include Scope 3 emissions, the sustainability of AWS, Microsoft, and Google Cloud is paramount.

The good news is the major providers are massive purchasers of renewable energy. This means that by choosing a cloud-native strategy, CyberArk is essentially buying into the scale and efficiency of the world's most advanced, and increasingly green, data centers. Their vendor selection process must now include a rigorous review of these providers' renewable energy commitments and carbon neutrality targets to mitigate their own Scope 3 risk and maintain their strong ESG ratings. If a key cloud vendor backslides on its net-zero goal, it directly impacts CyberArk's environmental profile. The action here is simple: Finance and Procurement must formalize environmental criteria in all cloud vendor contracts by end of Q1 2026.