Must read: AI agents powered by Claude, Grok, Kimi allegedly target 400 banks in Latin America
How did the AI-powered attack work?
Microsoft detailed that Storm-0940 first gained control of identities associated with multiple ConnectWise cloud applications. As mentioned above, the AI accessed customer environments through applications that already had access permissions, and ARTEX used AI agents to carry out malicious security workflows that could potentially reduce the time required to identify targets, attempt access, and pursue further activity.
The China state-aligned threat actor Storm-0940 used the agentic AI penetration testing framework ARTEX to automate attacks targeting hundreds of organizations globally across a broad range of industries. Microsoft Threat Intelligence assesses that Storm-0940 was responsible for the recently disclosed ConnectWise supply chain compromise of a multitenant application. https://t.co/VXovj0jI90 Our investigation found that Storm-0940's use of ARTEX accelerated the speed of compromised application abuse to authenticate to target environments through applications that had already been granted access, allowing the threat actor to operate without requiring an interactive user sign-in. AI-accelerated follow-on activity included reconnaissance, application credential changes, and attempts to modify privileges that could enable expanded or persistent access. Read our blog for a detailed analysis and indicators of compromise (IOCs), along with Microsoft Defender detections, protection recommendations, and guidance on investigating service principal sign-ins and unexpected application credential or privilege changes.
— Microsoft Threat Intelligence (@MsftSecIntel) October 21, 2026
Microsoft said some organisations experienced unauthorised cloud access within three hours of initial targeting. In certain environments, the attackers also added application credentials to maintain access and attempted to change privileged roles. In one instance, an application assigned itself the Global Administrator role, which provides extensive administrative control over a Microsoft cloud environment.
The company further stated that the activity was part of a campaign that began around September 2026, when Storm-0940 automated attacks against hundreds of organisations globally. ConnectWise disclosed attempts at unauthorised access in its Cloud Backup environment in an advisory published on October 16.
This highlights how AI-powered automation can increase the speed and scale of cyberattacks, giving less investigation time over suspicious activity and revoke unauthorised access. Microsoft advised organisations to investigate suspicious app sign-ins, review unexpected changes credentials and privileges, and follow ConnectWise's containment guidance.