Okta Inc. (NASDAQ:OKTA) delivered quarterly results on Wednesday that topped analyst expectations and came with a stronger full-year outlook, supported by steady enterprise demand and rising adoption of its identity governance and AI-driven security offerings.
Despite the beat, shares fell more than 3% in premarket trading.
For its fiscal third quarter, the identity-management company reported non-GAAP earnings of $0.82 per share, ahead of the $0.75 analysts were expecting. Revenue increased 12% year over year to $742 million, surpassing the $730.3 million consensus estimate. Subscription revenue — the company’s core business — rose 11% to $724 million.
Remaining performance obligations climbed 17% to $4.29 billion, while current RPO grew 13%. Okta also generated $218 million in operating cash flow, compared with $159 million a year earlier, and reported $211 million in free cash flow.
CEO Todd McKinnon highlighted ongoing momentum with major customers, calling the quarter “highlighted by continued strength with large customers” and strong uptake of solutions like Okta Identity Governance and its new Auth0 for AI Agents product. “AI agents are redefining how organizations work, and Okta is key to securing this technology transformation,” he said.
Okta posted GAAP net income of $43 million, up from $16 million last year. Non-GAAP operating income reached $178 million, representing a 24% margin.
Guggenheim analyst John DiFucci commented that “These results confirm our field work that Okta has seen improvement over the last two quarters, despite likely losing a large AI native customer early in F3Q.”
The company offered a cautiously optimistic full-year outlook. For fiscal 2026, Okta now expects revenue of $2.906 billion to $2.908 billion — slightly above consensus — and non-GAAP EPS of $3.43 to $3.44, ahead of the $3.37 forecast on Wall Street.
For the current quarter, management projected revenue of $748 million to $750 million, representing roughly 10% growth, and non-GAAP EPS of $0.84–$0.85. Current RPO growth is expected to come in at 8.9%, just below the 9.1% analysts were modeling.
Jefferies analysts noted that “While F4Q cRPO guidance is achievable, mgmt is guiding closer to the ‘pin’ & tough compares may somewhat limit upside,” adding, “That said, mgmt has messaged less conservatism for a few Qs now & has still beaten its guidance by approx 3 pts the past 2 quarters.”
Shares of Okta continued to fluctuate after the report as investors weighed the mixed signals of strong execution against more reserved near-term guidance.