The Australian Signals Directorate’s Australian Cyber Security Centre (ASD’s ACSC) has reported an increase in cyber security incidents and malicious activity targeting Australian organisations, with artificial intelligence (AI) contributing to faster and more sophisticated cyber threats.
In its Annual Cyber Threat Report 2025–26, released on 26 October 2026, ASD’s ACSC revealed it received more than 82,000 cybercrime reports during the financial year, averaging one report every six minutes.
The agency also responded to more than 1,500 cyber security incidents, representing a 20 per cent increase from the previous year, and issued more than 4,400 notifications to Australian entities about potentially malicious cyber activity, an increase of almost 80 per cent.
AI reshapes the cyber threat landscape
The report identifies AI as a significant factor influencing Australia’s cyber security environment, enabling malicious actors to identify vulnerabilities, develop exploits and conduct attacks with greater speed, scale and sophistication.
According to ASD’s ACSC, AI has also improved the effectiveness of social engineering techniques, allowing cybercriminals to generate convincing phishing emails, impersonate trusted individuals and automate targeted attacks.
The report notes that these developments have reduced the expertise and effort required to conduct cyber attacks, while creating additional security risks as organisations integrate AI tools and large language models into their operations.
However, it also identifies opportunities for organisations to use AI in cyber defence, including detecting vulnerabilities, monitoring unusual activity and improving incident response.
Manufacturing among sectors reporting more incidents
The report also identifies manufacturing as one of the 10 sectors reporting the highest number of cyber security incidents in 2025–26.
Manufacturing accounted for four per cent of reported incidents and recorded the largest increase in incident reports among all sectors during the financial year.
The sector was also among the three most affected by ransomware incidents, alongside healthcare and professional, scientific and technical services.
To address the growing threats, ASD’s ACSC emphasised the importance of strengthening cyber security controls, accelerating software patching, reducing exposure from legacy information technology systems and improving supply chain security.
The report also recommends that organisations review their security practices, implement multi-factor authentication or passkeys, and maintain appropriate monitoring and incident response capabilities.
Individuals and organisations that identify suspicious cyber activity, incidents or vulnerabilities are encouraged to report them through cyber.gov.au or the Australian Cyber Security Hotline on 1300 292 371.
The full Annual Cyber Threat Report 2025–26 includes further information on Australia’s cyber threat environment and guidance for individuals, businesses, government agencies and critical infrastructure operators.
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