Okta shares jumped 20% in extended trading after the identity security company beat fiscal second-quarter estimates on both earnings and revenue. The growth of agentic AI is driving demand for identity security tools, and Okta raised its full-year guidance.
Okta tops Wall Street estimates
Okta reported adjusted earnings of $1.05 per share against a 97-cent estimate, on revenue of $805 million versus $795 million expected. Revenue rose 11% from $728 million a year earlier, and net income totaled $116 million, or 65 cents per share, up from $67 million, or 37 cents per share, a year ago.
During the quarter, Okta made its Okta for AI Agents tool available to all customers. New products accounted for 30% of total bookings, and the company closed dozens of AI-related deals, including a multi-million-dollar agreement with a healthcare company.
AI-driven identity threats fuel demand
The growth of agentic AI, along with cyber hacks orchestrated by agents, is pushing companies to invest in more tools to manage swarms of new identities. CEO Todd McKinnon told CNBC the agentic AI security opportunity is still very early, and recent incidents, like the OpenAI Hugging Face hack, are only catalyzing interest. Looking out five or 10 years, McKinnon said: "it's definitely going to be identity".
Against this backdrop, cyber companies have pursued a wave of acquisitions to build out capabilities against new AI threats. That trend has also lifted peers CrowdStrike and Palo Alto Networks to record highs, while Okta shares have surged 55% this year.
Okta itself closed its acquisition of threat-detection startup Permiso Security on Wednesday, a deal valued at roughly $200 million. McKinnon said the company plans to continue smaller, complementary acquisitions rather than pursue a large legacy company purely for revenue.
Backlog grows, guidance rises
Remaining performance obligations, or subscription backlog, jumped 17% year over year to $4.86 billion, surpassing a $4.70 billion analyst estimate. Current remaining performance obligations, due in the next 12 months, rose 14% to $2.59 billion.
Okta raised its full-year revenue guidance to a range of $3.22 billion to $3.23 billion, up slightly from the roughly $3.19 billion to $3.21 billion range given last quarter. Adjusted earnings are now expected between $3.90 and $3.94 per share, above the $3.84 Wall Street estimate.
Source: CNBC
Trading involves risk.
Risk Disclaimer
