Okta (OKTA) delivered a stellar earnings report that sent its stock surging nearly 19% on Tuesday morning, reflecting investors’ optimism about the company's future.
The identity security giant posted adjusted earnings per share (EPS) of $0.78 on revenue of $682 million, surpassing Wall Street’s expectations of $0.74 EPS and $669 million in revenue. CEO Todd McKinnon described the quarter as a “breakout” moment, citing strength across all segments of the business.
Okta also raised its full-year revenue guidance to between $2.85 billion and $2.86 billion, an upward revision from its previous outlook of $2.77 billion to $2.78 billion. Analysts had anticipated $2.79 billion, making the revised forecast a clear signal of Okta’s confidence in its continued growth.
Strength Across the Board: Growth in Large Deals and Cloud Expansion
Several key factors contributed to Okta’s strong performance. The company’s sales productivity reached multi-year highs, and its 2021 acquisition of Auth0 proved to be a strategic success, delivering its best bookings quarter yet. Additionally, Okta’s ability to cross-sell security solutions to existing SIEM (security information and event management) customers played a pivotal role in driving revenue.
A major highlight was the company’s record-breaking bookings in Q4, exceeding $1 billion in total contract value (TCV) for the first time. Okta’s top 25 deals in the quarter alone were valued at over $320 million. The company also added 25 new customers with annual contract values (ACV) of $1 million or more, pushing the total ACV from this segment past the $1 billion mark.
Beyond the numbers, Okta crossed another milestone: $1 billion in sales through AWS Marketplace since first listing its identity solutions in 2020. A new strategic collaboration with Amazon (AMZN) Web Services is expected to further accelerate this growth, strengthening Okta’s position in the cloud security space.
Several key factors contributed to Okta’s strong performance. The company’s sales productivity reached multi-year highs, and its 2021 acquisition of Auth0 proved to be a strategic success, delivering its best bookings quarter yet. Additionally, Okta’s ability to cross-sell security solutions to existing SIEM (security information and event management) customers played a pivotal role in driving revenue.
A major highlight was the company’s record-breaking bookings in Q4, exceeding $1 billion in total contract value (TCV) for the first time. Okta’s top 25 deals in the quarter alone were valued at over $320 million. The company also added 25 new customers with annual contract values (ACV) of $1 million or more, pushing the total ACV from this segment past the $1 billion mark.
Beyond the numbers, Okta crossed another milestone: $1 billion in sales through AWS Marketplace since first listing its identity solutions in 2020. A new strategic collaboration with Amazon (AMZN) Web Services is expected to further accelerate this growth, strengthening Okta’s position in the cloud security space.
The Future of Identity Security: AI Integration and Long-Term Growth
Okta is positioning itself at the forefront of AI-driven security solutions. The company is integrating Amazon Bedrock into its customer identity platform and is serving as an identity provider for Amazon's AI assistant, Amazon Q. As AI adoption grows, securing identity and access management will become even more critical, and Okta aims to be the go-to solution in this evolving landscape.
The company’s outlook remains strong despite economic uncertainty. Okta projects fiscal year 2026 adjusted EPS between $3.15 and $3.20, a notable improvement from $2.81 in fiscal year 2025. While IT budgets remain under scrutiny, cybersecurity remains a non-negotiable priority for enterprises, a trend that is expected to drive sustained demand for Okta’s solutions.
As identity security becomes increasingly vital in the digital age, Okta’s strong execution, expanding partnerships, and AI-driven innovation put the company in a prime position for long-term growth. Investors and analysts alike are taking notice, with market momentum signaling that Okta’s best days may still be ahead.
The company’s outlook remains strong despite economic uncertainty. Okta projects fiscal year 2026 adjusted EPS between $3.15 and $3.20, a notable improvement from $2.81 in fiscal year 2025. While IT budgets remain under scrutiny, cybersecurity remains a non-negotiable priority for enterprises, a trend that is expected to drive sustained demand for Okta’s solutions.
As identity security becomes increasingly vital in the digital age, Okta’s strong execution, expanding partnerships, and AI-driven innovation put the company in a prime position for long-term growth. Investors and analysts alike are taking notice, with market momentum signaling that Okta’s best days may still be ahead.
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