Okta (OKTA) Earnings Date & Reports

Key Takeaways

• Okta reported total revenue of $805 million for its second quarter of fiscal 2027, up 11% year over year and above consensus estimates near $793 million.
• Non-GAAP (adjusted) diluted earnings per share (EPS) came in at $1.05, beating analyst expectations of roughly $0.96 to $0.97 and up from $0.91 a year earlier.
• Remaining performance obligations (RPO), or subscription backlog, grew 17% year over year to $4.858 billion, signaling healthy future revenue visibility.
• Free cash flow climbed to $227 million, or 28% of revenue, up from $162 million in the prior-year period.
• Okta guided for about $815 million in current-quarter revenue, above the roughly $808 million analysts had modeled.
• Shares rose in extended trading following the report, extending a strong 2026 run for the identity and access management (IAM) software maker.

Earnings Context and Why It Matters

Okta is a leading provider of identity and access management (IAM) software, helping enterprises secure workforce, customer, and increasingly machine and AI agent identities. Its second quarter of fiscal 2027, which ended July 31, 2026, arrives at a pivotal moment: cybersecurity stocks have rallied broadly in 2026, and investors are watching closely for evidence that the emerging agentic AI (artificial intelligence) wave is translating into real demand for identity security.

With shares already up roughly 50% in 2026 before the report, the quarter was a key test of whether Okta could sustain momentum, expand profitability, and demonstrate durable subscription growth amid elevated valuation expectations.

Reported Results

Okta delivered a broad-based beat for the second quarter of fiscal 2027. Total revenue rose 11% year over year to $805 million, while subscription revenue increased 12% to $793 million. Non-GAAP diluted EPS came in at $1.05, comfortably ahead of the consensus estimate near $0.96 and up from $0.91 in the same quarter a year ago.

Profitability strengthened on a generally accepted accounting principles (GAAP) basis as well. GAAP operating income rose to $107 million, or 13% of revenue, compared with $41 million, or 6% of revenue, a year earlier. GAAP net income climbed to $116 million, versus $67 million in the prior-year period.

Key forward-looking metrics impressed. Remaining performance obligations (RPO), the company's subscription backlog, grew 17% year over year to $4.858 billion, while current RPO (cRPO), the portion expected to be recognized within 12 months, rose 14% to $2.585 billion. Management described the cRPO performance as its largest outperformance since fiscal 2024.

Cash generation also improved markedly. Operating cash flow reached $234 million (29% of revenue), and free cash flow rose to $227 million (28% of revenue), up from $162 million a year earlier. Okta held $2.299 billion in cash, cash equivalents, and short-term investments at quarter-end.

For the current quarter ending in October, Okta guided to roughly $815 million in revenue, above the analyst consensus near $808 million. Full-year fiscal 2027 revenue guidance was set at approximately $3.216 billion to $3.226 billion, implying growth of about 10% to 11%.

AI Screener

For investors looking to surface opportunities like Okta before or after major earnings events, Tickeron's AI Screener offers an AI-powered stock and exchange-traded fund (ETF) discovery tool. The platform helps traders and investors filter the market using technical patterns, fundamentals, trends, volatility, and AI-driven signals. Users can scan thousands of stocks and ETFs with customizable filters such as industry, market capitalization, technical indicators, price patterns, and performance metrics. The screener is designed to help identify trade ideas, trending stocks, breakout candidates, and market opportunities more efficiently than manual screening. Explore the AI Screener to support your own research process.

Market Reaction and Investor Sentiment

The market responded favorably. Okta shares jumped more than 12% in extended trading immediately after the report, according to reports, with some sources citing even larger intraday gains as investors digested the top- and bottom-line beat alongside stronger-than-expected guidance. The rally built on a strong year-to-date advance, with the stock up more than 50% in 2026 before earnings.

Investor sentiment was buoyed by the combination of accelerating backlog growth, a rising free cash flow margin, and management commentary highlighting early traction in AI-driven identity security. The beat-and-raise profile reinforced the view that Okta is successfully positioning itself at the center of the agentic AI trend while continuing to grow its core workforce and customer identity businesses.

Forward Outlook and Key Factors to Monitor

Following a quarter that exceeded expectations, attention turns to whether Okta can sustain its momentum into the back half of fiscal 2027. The company's current-quarter revenue guidance near $815 million and full-year target of roughly $3.216 billion to $3.226 billion suggest management expects steady, double-digit growth to continue.

One key area to watch is cRPO (current remaining performance obligations), a leading indicator of near-term revenue. After rising 14% year over year, the trajectory of this metric will signal whether enterprise demand for identity security remains durable.

Investors should also monitor the emerging AI agent identity opportunity. Management has described early million-dollar deals and a pipeline of customers securing AI agents, but noted the category is still too small to materially impact results. How quickly this business scales over the next several quarters could shape long-term growth expectations.

Finally, margin and cash flow trends remain important. Okta's free cash flow margin expanded to 28% this quarter, and the company has guided to continued operating leverage. Any change in spending priorities, competitive dynamics in the crowded IAM market, or shifts in enterprise IT budgets could influence both profitability and sentiment in the quarters ahead.

Disclaimer

The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.

Disclaimers and Limitations