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AI Coding Agent Hijacked to Spread Worm Across 100 Repos Amid Agentic Investment Surge

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Cybersecurity firm Mandiant reported that an attacker hijacked an AI coding-assistant session at a SaaS provider, using it to propagate the Shai-Hulud worm through approximately 100 internal code repositories — marking one of the first confirmed real-world cases of an agentic tool being exploited as a supply-chain attack vector. The incident coincided with major funding activity in the AI agent space, as orchestration platform Temporal closed a $550 million Series E at a $12.55 billion valuation, and coding-agent startup Factory tripled its valuation to $5 billion after raising $200 million. Security vendor Exaforce responded to growing concerns by launching a kill-switch capability within its AI Security platform, offering runtime containment controls for AI agents across endpoint and cloud environments. Analysts note that the same features making agentic tools powerful — persistent sessions, broad repository access, and autonomy — are the properties that make them attractive targets for attackers.

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