Key Stats for Okta Stock
- Today’s Price Change: -12%
- Current Share Price: $109
- 52-Week High: $127
- Okta Stock Price Target: $124
What Happened?
Okta (OKTA) stock is down 12% even as the company reported first-quarter earnings that beat analyst expectations on both revenue and earnings per share.
The identity management software player posted adjusted earnings of $0.86 per share versus estimates of $0.77 per share, while revenue of $688 million topped estimates of $680 million.
The stock declined after the company maintained its full-year guidance despite the better-than-expected quarterly results. Okta kept its revenue forecast at $2.85-$2.86 billion for fiscal 2026, citing economic uncertainty and a more cautious approach to forward-looking projections.
CEO Todd McKinnon acknowledged that customer conversations have become more cautious, though he emphasized that Okta saw no material impact on business performance during the first quarter.
Okta’s decision to factor in potential macroeconomic headwinds reflects broader concerns about the impacts of tariffs and economic volatility on the technology sector.
Revenue grew 12% year-over-year to $688 million, with subscription revenue also increasing 12% to $673 million.
Okta swung to profitability, reporting a net income of $62 million compared to a $40 million loss in the prior year period. The current remaining performance obligations of $2.23 billion exceeded the $2.19 billion estimate.
See Okta’s full analyst estimates, earnings results, and earnings transcript (It’s free) >>>
What the Market Is Telling Us
Okta’s reaction suggests investors were expecting stronger guidance given the solid quarterly performance and its recent go-to-market restructuring initiatives.
Okta’s specialization of its sales force into dedicated Okta and Auth0 teams showed early positive signs, with Auth0 performing particularly well following a record fourth quarter.
It highlighted strong momentum in new products, including Identity Governance, Privileged Access, and Identity Security Posture Management, with workflow executions increasing nearly 400% over the past three years.
Despite these operational improvements, investors appear concerned about the conservative outlook in an uncertain economic environment.
Okta’s cautious stance mirrors similar approaches taken by other technology companies grappling with potential tariff impacts and shifting customer spending patterns.
The disconnect between strong execution and tepid guidance reflects the challenging balance between delivering results and managing expectations in volatile market conditions.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
