Okta Reports 12% Revenue Growth to $742 Million in Latest Quarter

Okta, Inc. reported significant financial performance in its latest quarterly filing, with total revenue reaching $742 million for the three months ended October 31, 2025, marking a 12% increase from $665 million in the same period last year. Subscription revenue, which constitutes the bulk of the company's income, rose to $724 million, up from $651 million, driven by a 106% dollar-based net retention rate and an increase in customers with annual contract values exceeding $100,000. For the nine months ending October 31, 2025, total revenue was $2.158 billion, compared to $1.928 billion in the prior year, reflecting a similar growth trajectory.

The company also reported a net income of $43 million for the third quarter, a notable increase from $16 million in the previous year. This improvement in profitability is attributed to a combination of higher revenue and effective cost management, with total operating expenses rising at a slower rate than revenue. Operating income for the quarter was $23 million, compared to a loss of $16 million in the same period last year. The gross profit margin improved to 77%, up from 76% a year earlier, indicating enhanced operational efficiency.

In terms of strategic developments, Okta completed the acquisition of Axiom Security Ltd. for $54 million, which is expected to enhance its privileged access management capabilities. The company continues to focus on expanding its product offerings and enhancing its technology infrastructure to support its growth strategy. As of October 31, 2025, Okta reported over 5,030 customers with annual contract values above $100,000, an increase from 4,705 in the previous year, underscoring its growing market presence.

Operationally, Okta's cash and cash equivalents totaled $645 million, up from $409 million at the beginning of the fiscal year, reflecting strong cash flow from operations, which amounted to $626 million for the nine months ended October 31, 2025. The company also reported deferred revenue of $1.586 billion, indicating a solid backlog of contracted revenue. However, Okta acknowledged potential challenges ahead, including longer sales cycles and macroeconomic uncertainties that could impact future growth.

Looking forward, Okta remains optimistic about its growth trajectory, driven by increasing demand for identity management solutions amid the shift to remote and hybrid work environments. The company plans to continue investing in its technology and expanding its international operations, while also monitoring the impacts of economic conditions on its business. The management's outlook suggests a commitment to maintaining its competitive edge in the identity management market, despite the challenges posed by the current economic landscape.