Europe’s cybersecurity market is projected to grow from $81.81 billion in 2025 to $165.73 billion by 2034, according to a new report from IMARC Group. The firm forecasts an 8.2 percent compound annual growth rate as escalating cyber threats and tighter regulation push organizations to boost their security spending.
The report links growth to ransomware activity targeting nearly twenty two percent of global extortion victims and AI supported phishing campaigns accounting for over eighty percent of social engineering attacks. Trends such as these are increasingly leading organizations to expand investment in detection, response, and resilience solutions.
SEE ALSO: Startup businesses need to take cybersecurity seriously
Regulatory frameworks are also impacting budgets. The NIS2 Directive extends mandatory cybersecurity requirements across eighteen critical sectors, affecting around thirty thousand companies in Germany alone, while the Digital Operational Resilience Act introduces stricter ICT risk management obligations for financial institutions across the EU.
Services account for 54.08 percent of the market by component, showing the widespread reliance on managed security providers and consulting expertise. Many organizations are turning to external partners for compliance assessments, zero trust architecture planning, and incident response support.
On premises deployments hold 58.12 percent of the market by deployment type, driven by data sovereignty requirements and regulatory compliance priorities. Certain sectors, including defense and public administration, require tighter control over infrastructure and data processing environments.
Cybersecurity oversight
Large enterprises represent 70.1 percent of total market share by user type. They face complex threat landscapes and direct regulatory accountability at the executive level, which is increasing board level oversight of cybersecurity programs.
The banking, financial services, and insurance sector leads by industry vertical with a 24.15 percent share. Financial institutions continue to face persistent attack attempts and are subject to strict oversight under EU regulations.
The report also identifies growing trends, including greater use of AI in threat detection, expansion of hybrid cloud security architectures, and rising merger and acquisition activity.
At the same time, the industry faces a shortage of skilled cybersecurity professionals and growing complexity in supply chain risk management. AI enabled attacks and multi tier outsourcing arrangements are adding pressure to security teams across Europe.
What do you think about Europe’s projected cybersecurity growth through 2034? Let us know in the comments.
