TLDR
- Okta delivers 12% revenue growth and stronger margins in a competitive identity market.
- Subscription gains and rising RPO reveal Okta’s expanding long-term customer demand.
- Profitability surges as cash flow climbs, showing disciplined financial execution.
- Improved liquidity and debt reduction strengthen Okta’s financial foundation.
- Upbeat Q4 and FY2026 outlook signals steady, durable growth ahead for Okta.
Okta Inc. (OKTA) reported solid third-quarter fiscal 2026 results, marking a 12% year-over-year revenue increase to $742 million. The company’s strong subscription growth, expanding cash flow, and improved profitability lifted market confidence as shares closed at $81.87, up 1.53%.
Okta, Inc., OKTA
Okta’s performance highlighted continued enterprise adoption and effective execution amid a competitive identity management landscape.
Sustained Revenue and Subscription Growth
Okta’s total revenue reached $742 million, reflecting steady demand across its product suite. Subscription revenue climbed 11% year-over-year to $724 million, underscoring consistent customer retention and recurring income. The company’s ability to deliver double-digit growth showcased its expanding footprint in digital identity and access management.
The firm’s remaining performance obligations (RPO) totaled $4.29 billion, a 17% rise from the prior year. Its current RPO, representing contracts expected within 12 months, increased 13% to $2.33 billion. These metrics signaled continued momentum in long-term customer commitments.
Okta maintained a disciplined approach to profitability and cost management. Its GAAP operating income reached $23 million compared to a $16 million loss last year. Non-GAAP operating income surged to $178 million, accounting for 24% of revenue.
Strong Cash Flow and Improved Profitability
Operational efficiency strengthened Okta’s financial position during the quarter. Net cash from operations totaled $218 million, or 29% of revenue, while free cash flow stood at $211 million. These results demonstrated the company’s focus on sustainable cash generation and expense control.
Okta’s GAAP net income rose to $43 million from $16 million a year earlier, while non-GAAP net income reached $152 million. Non-GAAP diluted earnings per share improved to $0.82, reflecting higher margins and optimized cost structures. Cash, cash equivalents, and short-term investments reached $2.46 billion by quarter-end.
The company also completed the settlement of its 2025 Notes, paying $510 million in cash. This move strengthened its balance sheet and reduced future debt obligations. Okta ended the quarter with a robust liquidity position and improved financial flexibility.
Outlook Signals Steady Growth Ahead
For the fourth quarter, Okta expects revenue between $748 million and $750 million, implying 10% year-over-year growth. The company projects non-GAAP operating income between $189 million and $191 million with a 25% operating margin. Non-GAAP diluted earnings per share are forecasted at $0.84 to $0.85.
For fiscal 2026, Okta anticipates revenue between $2.906 billion and $2.908 billion, reflecting an 11% growth rate. It expects non-GAAP operating income of about $754 million, representing a 26% margin. The company also aims for a non-GAAP free cash flow margin near 29%, signaling continued financial strength and disciplined execution.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
