Okta Inc. (OKTA) experienced a dip in its stock price despite reporting third-quarter earnings and revenue that exceeded analysts’ expectations, thanks to strong demand from large customers. The cybersecurity firm announced its results after the market closed on Tuesday, revealing earnings of 82 cents per share on an adjusted basis for the quarter that ended on October 31, which marks a 22% increase compared to the prior year. Additionally, Okta’s revenue grew by 12% to reach $742 million, outperforming the anticipated $731 million.
A crucial metric for the company, current remaining performance obligations (CRPO), also surpassed forecasts, rising by 13% to $2.328 billion, compared to estimates of $2.263 billion. This figure includes both deferred revenue and backlog orders, showcasing the company’s solid future sales outlook.
Looking ahead, Okta provided optimistic guidance for the upcoming quarter ending in January, predicting revenue to land around $749 million, exceeding the consensus estimate of $738 million among analysts.
Despite these positive earnings, Okta’s stock fell more than 2% to $79.60 in after-hours trading. Prior to the earnings announcement, the stock had shown resilience with a 3% increase in value for 2025.
The identity-security firm specializes in monitoring and managing privileged accounts, an essential service in protecting against cyberattacks that often target employees or management with enhanced access rights. Heading into this earnings report, Okta held a Composite Strength Rating of 41 out of a possible 99, indicating potential room for growth in its market position, while its Accumulation/Distribution Rating stood at C-minus, reflecting a neutral trading environment amidst fluctuations in investor interest.
Okta is navigating competition from significant players in the cybersecurity space, notably Microsoft, which poses challenges for its market share.
Overall, Okta’s latest earnings report reflects a company with growing revenues and robust demand from its customer base, reaffirming its strategic position in a competitive industry. The outlook remains cautiously optimistic as it adapts to the evolving cybersecurity landscape.