Cybersecurity company Palo Alto Networks has flagged rising data security risks tied to the growing use of generative AI (GenAI) tools in the Philippines, as local adoption continues to expand across sectors.
In Palo Alto Networks’ State of Generative AI 2025 report, the company reported an 890% increase in global GenAI traffic in 2024. In the Philippines, the most used tools were Grammarly (46.21%), Microsoft PowerApps (33.32%), and Microsoft 365 Copilot (13.97%), showing strong demand for solutions that support writing, productivity, and workplace efficiency.
While GenAI tools are being used for tasks like writing assistance, coding, customer service, and enterprise search, many organizations have yet to put proper security systems in place. The report found that companies are now managing an average of 66 GenAI applications, with 10% considered high-risk.
“As GenAI tools become more embedded in enterprise operations in the Philippines, the risk of data exposure and threats grows significantly,” said Steven Scheurmann, regional vice president for ASEAN at Palo Alto Networks. “It is imperative to create stronger guardrails, striking the right balance between AI-driven innovation and security.”
The report also noted a sharp spike in traffic linked to DeepSeek-R1, an open-source large language model released in January 2025 from China. DeepSeek-related traffic rose 1,800% within two months.
GenAI-related data loss prevention (DLP) incidents more than doubled over the past year, now making up 14% of all reported data security events. Palo Alto Networks also pointed to the rise of “Shadow AI,” or the unsanctioned use of GenAI tools, which makes it harder for IT and security teams to monitor sensitive data.
“Organizations must balance innovation with strong governance, adopting security architectures that account for AI’s unique risks,” said Tom Scully of Palo Alto Networks.
The technology and manufacturing sectors were found to be the most active in GenAI-assisted coding, accounting for 39% of such transactions, raising concerns about the potential exposure of intellectual property.
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