Jim Cramer calls CrowdStrike’s announcement of an artificial intelligence kill switch game-changing for cybersecurity. “You should just go buy CrowdStrike,” Jim said on CNBC after speaking with CrowdStrike CEO George Kurtz in an interview that will run Tuesday evening on “Mad Money.” Jim added that this development will be good for the Club stock, which rose about 1%. CrowdStrike unveiled its so-called AI Kill Switch during the European leg of its annual cybersecurity conference, Fal.Con, as a new feature of its Falcon Guardian platform. Launched in September, Falcon Guardian is CrowdStrike’s flagship AI Detection and Response solution aimed at securing AI agents, which can be enabled to think, plan, and take actions on their own within companies’ computer systems. CrowdStrike and other cyber companies, like fellow Club holding Palo Alto Networks , have been warning that the proliferation of AI agents increases digital vulnerabilities exponentially and call for a new kind of security. CrowdStrike said its kill switch tool will allow security teams to take control of AI agents that stray from their assigned behavior. Essentially, it is designed to give humans more power over artificial intelligence models and systems. Ultimately, Jim sees the tool as a significant growth driver for CrowdStrike and a breakthrough for the broader industry. He called the “AI Kill Switch” the “holy grail,” arguing that the ability to shut down rogue AI agents addresses one of the biggest concerns surrounding the technology’s rapid adoption. “Everyone says there’s no kill switch,” Jim said, noting that this has been the message from leading AI companies like Anthropic and OpenAI. “It’s not true anymore. There’s a kill switch. You can shut these down.” On Sept. 12, which was a Saturday, Anthropic CEO Dario Amodei released an essay calling for an industry slowdown in AI development, citing safety concerns. OpenAI CEO Sam Altman was among those who backed Amodei’s call. On the other side of the debate, companies like Nvidia argued there is no need for a coordinated effort to pace AI deployment because companies should rigorously test and determine on their own if their products are safe. On Monday, Sept. 14, the first trading day after the Amodei essay, concerns about the safety of AI reached a fever pitch. Cybersecurity stocks soared. CrowdStrike rose nearly 14% that day. That evening, Kurtz told Jim on “Mad Money” that slowing AI models won’t eliminate the cybersecurity risks. “The genie’s out of the bottle,” Kurtz said at the time. “There’s plenty of models that are already out there, both frontier as well as open-weight models, that can already be dangerous.” The next night , Nvidia CEO Jensen Huang told Jim: “Safety is an engineering problem. Testing is an engineering problem.” CrowdStrike stock went on to close at a record high of $278 apiece on Oct. 6. Shares have fallen about 12% since then after a terrible October and early November for tech stocks. But that has not deterred Jim’s enthusiasm for CrowdStrike as a continued beneficiary of the need to control AI. CRWD mountain 2024-11-03 CrowdStrike 2-year performance Over the past couple of years, CrowdStrike has been such a big winner for the Club that we sold some late last month after the stock turned higher. At the time, portfolio director Jeff Marks wrote: “This decision doesn’t reflect anything negative about the cybersecurity company’s fundamentals. Rather, it’s a portfolio management move to right-size the position (once again) following a big move that pushed its weighting toward the top of the portfolio. From this sale, we will realize a gain of roughly 187% on stock purchased in late 2024.” For the Club, we have a hold-equivalent 2 rating on CrowdStrike — content with its more than 4% weighting in our diversified portfolio. (Jim Cramer’s Charitable Trust is long CRWD, PANW, NVDA. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
