IDC Japan has released its latest results and forecast for the domestic security software market, highlighting strong growth driven by escalating cyber threats and expanding adoption of AI technologies.
According to IDC Japan, the domestic security software market, including public cloud services, recorded vendor revenues of 327.2 billion yen or $2.1 billion USD in the first half of 2025, representing year-on-year growth of 14.1 percent. During the same period, global security software revenues increased by 15.7 percent year on year to 66.1 billion US dollars, based on data from the IDC Worldwide Semiannual Software Tracker published in November 2025.
IDC categorizes the security software market as one of 20 major segments within the broader software market. It is further divided into seven functional segments, including Endpoint Security Software, Identity and Access Management Software, and Information and Data Security Software, with vendor revenue data and forecasts tracked globally and in Japan, IDC report said.
Cyberattacks and AI Adoption Fuel Market Expansion
IDC attributes the strong growth of Japan’s security software market in the first half of 2025 to the sharp increase in cyberattacks across industries and company sizes. The emergence of advanced and novel threats using AI and generative AI technologies has pushed Japanese enterprises to expand security software investments.
At the same time, enterprises have accelerated evaluations for full-scale AI adoption. As AI becomes more deeply embedded in business operations, security and governance platforms are increasingly recognized as essential foundations, further contributing to market growth.
Key Security Software Segments Driving Growth
Several functional segments played a leading role in market expansion during the first half of 2025.
The Endpoint Security Software market grew by 10.9 percent year on year to 92.2 billion yen or $592 million USD, accounting for approximately 28.2 percent of the total security software market. Growth was primarily driven by Endpoint Detection and Response, which expanded by 22.1 percent year on year.
The Identity and Access Management market increased by 17.3 percent year on year to 64.9 billion yen or $416.7 million USD. As analysis of cyberattack methods has advanced, attacks using stolen credentials and privilege escalation have become more visible, underscoring the importance of identity management. Demand has also risen for stronger authentication and access control platforms to support data utilization and AI-driven initiatives.
The Security Analytics Software market recorded growth of 22.4 percent year on year, reaching 50.5 billion yen or $324.24 million USD. Investments centered on comprehensive security operations, particularly SIEM platforms, which grew by 26.4 percent, as organizations sought to defend against increasingly complex and multi-directional cyberattacks. The use of AI to manage large volumes of alerts and improve incident context analysis also supported market expansion.
Market Forecast Through 2029
IDC expects investment in security software to continue rising. Key growth drivers include the shortage of skilled security professionals, the need to counter increasingly sophisticated cyber threats, and the adoption of AI-enabled security technologies supported by comprehensive security operations platforms.
IDC forecasts that the domestic security software market will grow at a compound annual growth rate of 12.2 percent from 2024 to 2029, reaching 1.05 trillion yen by 2029.
Mayumi Nishimura, Software Research Manager at IDC Japan, said that cyberattacks have become a persistent reality in Japan, with their direct impact on business performance now clearly visible. She noted that attackers are increasingly using AI-based techniques, making attacks more sophisticated and faster. While regulatory industries are progressing in response to strengthened security-related legislation, broader adoption among general enterprises remains slow.
Nishimura also emphasized that from a supply chain perspective, companies must strengthen security not only for their own systems but also across partner ecosystems. To enhance competitiveness through AI and generative AI, enterprises require more robust security foundations. She added that organizations must move beyond fragmented security measures toward comprehensive security operations that can monitor, analyze, and respond across entire systems, including the supply chain.
RAJANI BABURAJAN
