Microsoft Report Warns of AI-Powered Automation in Cyberattacks and Malware Creation

Cybercriminals are weaponising artificial intelligence to accelerate malware development, speed vulnerability discovery, and craft more sophisticated phishing campaigns, according to Microsoft’s latest Digital Defense Report. The document notes a 2025 escalation in AI adoption by both attackers and defenders, with threat actors using generative AI to automate phishing, discover software flaws at unprecedented speeds, and develop adaptive malware that can change its behaviour to dodge detection.

It also highlights that the vast majority of cyberattacks are driven by financial motives, with over 52% of incidents linked to extortion or ransomware, and that in 80% of the incidents Microsoft investigated last year, data was sought primarily for profit. In May, Microsoft’s Digital Crimes Unit disrupted Lumma Stealer, the most popular infostealer malware, in collaboration with the US Department of Justice and Europol, while defenders are using AI to spot threats and close detection gaps.

The report also notes that identity attacks surged 32% in the first half of 2025, with more than 97% targeting passwords through large-scale guessing using leaked credentials, though phishing-resistant MFA can block over 99% of these attacks.