Every year we publish a cybersecurity trends piece, and every year we hope the news will be a little less dire. No such luck for 2026. The threats keep evolving, the attackers keep getting smarter, and the regulatory landscape keeps adding new boxes to check.
This article covers five trends that SMB leaders should be tracking: the AI arms race, modern extortion tactics, cloud and virtualization risks, regulatory pressure, and the ongoing talent gap. We hope that the information will help you prioritize where to put your attention and budget over the next twelve months.
1. The AI Arms Race
The biggest trend we expect to continue in 2026 is the sheer pace at which the cybersecurity landscape is evolving, and artificial intelligence is the accelerant.
Generative AI models have gotten remarkably good at most tasks that are necessary to pull off a successful attack. Claude Opus 4.5 now scores higher on coding assessments than human engineers at Anthropic. GPT-5.2 achieved a perfect 100% on competition-level math problems without external tools. Gemini 3.0 can answer even advanced scientific questions with remarkable accuracy. Attackers are taking advantage of these capabilities to:
- Develop new malware: AI tools can generate functional ransomware code and help attackers discover vulnerabilities faster. While these outputs are often derivative, they lower the barrier to entry and let less sophisticated criminals operate at scale. Security analysts have observed over 1,000 new malware variants per minute in the wild, and it’s likely that the number will keep increasing hand-in-hand with the performance of AI models.
- Launch convincing phishing attacks at scale: AI-generated phishing emails now achieve a 54% click-through rate compared to just 12% for human-written messages. The grammar is flawless, the personalization is convincing, and the volume is essentially unlimited. Voice phishing (vishing) attacks increased 442% in the second half of 2024 alone, according to the 2025 CrowdStrike Global Threat Report.
- Clone human voices: Scammers need only three seconds of audio to clone someone’s voice with 85% accuracy. Deepfake fraud cases surged 1,740% in North America between 2022 and 2023, including a case where criminals used a deepfake video call to impersonate a CFO and steal $25 million. Losses from deepfake fraud are expected to hit $40 billion by 2027.
The good news is that AI works for defenders too, and organizations that deploy it are seeing real results. According to IBM, companies using AI and automation extensively saved an average of $2.2 million per breach and cut detection and containment time by 98 days. Two-thirds of organizations now deploy some form of AI in their security operations.
Specifically, organizations can significantly benefit from the implementation of behavioral analysis that catches threats signature-based antivirus would miss, automated threat detection that filters out false positives, and tools that can correlate suspicious activity across endpoints, email, and cloud environments. If your current setup doesn’t include these, 2026 is the year to upgrade.
2. Modern Extortion Tactics
In the not-so-distant past, many cyberattacks succeeded simply because organizations relied on passwords alone (often weak ones). The industry responded with a major push toward multi-factor authentication (MFA), and for a while, that made a real difference. But attackers adapt. In 2026, MFA is no longer the silver bullet it once was.
According to security researchers at ThreatHunter.ai, 87% of successful cyberattacks in 2024 involved session hijacking after valid MFA logins. In these attacks, hackers steal session cookies after a user successfully authenticates, which renders the MFA check meaningless. Other bypass methods include exploiting legacy protocols and MFA fatigue attacks, where hackers bombard a user’s authenticator app with repeated login requests until the frustrated or distracted user approves one.
The tactics have evolved too. Most ransomware gangs now practice “double extortion,” encrypting your files while also stealing data and threatening to leak it. In fact, 93% of ransomware attacks now involve data exfiltration. Some groups skip the encryption entirely and go straight to theft and extortion.
These trends reinforce the need for layered defenses. Phishing-resistant MFA methods like hardware keys or passkeys are far more resilient against token theft and fatigue attacks, monitoring for abnormal login patterns can catch session hijacking early, and immutable backups reduce the leverage attackers have if ransomware does get through.
3. Cloud Vulnerabilities
The shift to cloud has been underway for years, but 2026 is the year many SMBs will realize just how much of their attack surface now lives outside their physical walls. According to IBM, 82% of data breaches now involve data stored in cloud environments, which isn’t surprising given how much has moved there.
Nearly 23% of cloud security incidents stem from misconfiguration errors because it only takes one misstep, like a storage bucket left open, an unused port exposed, or overly permissive access settings, to give attackers an easy way in.
Then there’s the cloud software your IT team doesn’t even know about and thus can’t properly secure. Employees sign up for SaaS tools to solve immediate problems, often without thinking about security implications. Research shows that 65% of all SaaS apps in use at organizations are unsanctioned, making shadow IT one of the biggest cybersecurity threats.
The solution is visibility. You can’t secure cloud assets you don’t know exist, so regular audits and cloud app security tools are essential. You should also give employees the minimal permissions necessary for them to do their jobs so that a compromised account can’t reach data it has no business accessing. For a deeper look at what it takes to stay secure in the cloud, we’ve covered cloud security best practices in more detail.
4. Regulatory Pressure
If keeping up with threats wasn’t enough, 2026 also brings a wave of new compliance requirements. For SMBs, especially those working with the federal government, this is the year to get serious about regulatory readiness:
- CMMC Phase 2 (November 2026): The Department of Defense’s Cybersecurity Maturity Model Certification program moves into its second phase, which requires contractors handling Controlled Unclassified Information (CUI) to pass third-party assessments by accredited C3PAOs (Phase 1 began November 2025 and focused on self-assessments).
- Indiana Consumer Data Protection Act (January 1, 2026): Indiana’s privacy law (PDF) takes effect, applying to businesses that process personal data of at least 100,000 Indiana consumers or derive more than 50% of revenue from selling data of 25,000+ consumers. Requirements include privacy notices, consumer data access rights, and opt-out mechanisms.
- Kentucky Consumer Data Protection Act (January 1, 2026): Kentucky’s privacy law mirrors Indiana’s thresholds and requirements, so it adds another state to the patchwork of privacy regulations businesses must navigate.
- Rhode Island Data Transparency and Privacy Protection Act (January 1, 2026): Another new privacy law comes from Rhode Island, and it has lower thresholds than most (just 35,000 consumers or 10,000 with 20% revenue from data sales). It also notably lacks a cure period for violations, which means that penalties can apply immediately.
By the end of 2026, nearly 20 states will have comprehensive privacy laws on the books. For SMBs operating across state lines, this patchwork creates real compliance headaches. The practical approach is to adopt a baseline that satisfies the strictest requirements you’re likely to face, rather than trying to maintain separate compliance programs for each jurisdiction.
5. Talent and Training
The cybersecurity industry has a people problem. Globally, there’s a shortfall of 4.8 million professionals needed to fill available security roles, and 67% of organizations report staffing shortages. For SMBs, competing with larger enterprises for scarce talent is often a losing battle, and the cost of being understaffed is real. IBM found that organizations with security staffing shortages paid $1.76 million more per breach on average than those with adequate teams.
To cope with the talent shortage, many organizations now outsource at least some cybersecurity functions to managed service providers, like us at OSIbeyond, who can offer 24/7 monitoring, incident response, and compliance expertise at a fraction of the cost of a full internal team.
MSPs also provide employee training, which is essential because people remain the weakest link in any security program. According to Verizon, 68% of breaches involve the human element because employees fall for phishing, misconfigure systems, or make honest mistakes that open the door to attackers. With an ongoing awareness program, even regular employees can become a line of defense rather than a liability.
Looking Ahead
2026 won’t be an easy year for cybersecurity because AI is making attacks faster, cheaper, and more convincing. At the same time, ransomware gangs keep refining their playbooks, cloud environments are expanding faster than most security teams can monitor, and new regulations are adding compliance burdens.
The organizations that fare best will be the ones that don’t wait for an incident or compliance deadline to force their hand. Instead, they proactively implement layered defenses and treat security as an ongoing process rather than a one-time project.
If you’re not sure where to start, or if you’re looking for a partner to help fill the gaps, we’re here. We at OSIbeyond work with SMBs across the Washington DC area, and you can schedule a free consultation to talk through what 2026 looks like for your organization.