Chinese Hackers Deploy AI Agents in Rapid Supply Chain Breach
A China-aligned group utilized autonomous AI tools to infiltrate thousands of Microsoft tenants through stolen ConnectWise credentials, achieving privileged access in under three hours.
By Ana Castro ·
Microsoft confirmed on October 23 that a China-state-aligned threat actor known as Storm-0940 executed a massive supply chain attack using an open-source agentic AI framework called ARTEX. The intrusion leveraged stolen credentials from ConnectWise applications to attempt sign-ins at more than 2,250 Microsoft 365 tenants. In several instances, the attackers achieved privileged access to tenant systems less than three hours after initial targeting.
The operation relied on ARTEX, a system of large language model-driven agents designed to run autonomous penetration tests. These agents accelerated scanning, reconnaissance, and password spraying while minimizing the need for human interaction. Microsoft noted that the pace of the attacks left defenders with little time to detect and respond to the threat. It remains uncertain how the initial ConnectWise credentials were stolen or the exact number of tenants ultimately compromised.
Storm-0940 has been active since 2021 and is characterized as a developing actor with no known industry aliases. The campaign targeted fourteen organizations across aerospace, defense, semiconductor, government, and think tank sectors. Microsoft clarified that the attack did not stem from a vulnerability in its own systems or services but rather from unauthorized access to the multi-tenant application.
Automated password spraying also affected 327 accounts across eight organizations, resulting in more than 151,000 failed logons with no successful entries. On the peak day of October 11, the spray generated 2,900 attempts per minute, with nearly 98 percent of the activity resulting in lockouts. However, using valid ConnectWise app credentials, the AI agents signed into customer tenants from a single IP range, completing more than 200 sign-ins in under four minutes.
Within affected tenants, the attackers performed directory operations, reconnaissance, and changes to app credentials, identities, and privileged roles. On October 15, the security firm Huntress observed an app adding itself to the top administrator role in one tenant. By October 17, Huntress had confirmed unauthorized sign-ins for nearly 1,000 Entra tenants, with more than 300 successful logins. The sequential nature of the attacks suggested the use of a script working from a predefined target list.
The use of ARTEX distinguishes this campaign from many traditional attacks, as the framework can utilize various AI models. Public reports this month linked the tool to breaches at South Korean financial institutions, where the suspect allegedly used it with Anthropic’s Claude Code. The developer of ARTEX, identified by the handle Autumn-27, announced on GitHub that the project would become closed source and cease updates.
ConnectWise suspended its Cloud Backup, SaaS Security, and Cloud Management services as a precaution following the unauthorized access. The company has begun a phased restoration process, with full recovery expected to take several days. While there are no current indicators that partner backup data was compromised, Microsoft advises customers to keep affected app connections disabled and to review recent activity logs until formal restoration instructions are issued.
