Okta Earnings: What To Look For From OKTA

Kayode Omotosho /
2023/08/29 7:13 am EDT

Identity management software maker Okta (OKTA) will be announcing earnings results tomorrow after market close. Here's what to expect.

Last quarter Okta reported revenues of $518 million, up 24.8% year on year, beating analyst revenue expectations by 1.43%. It was a decent quarter for the company, with in-line revenue guidance for the next quarter.

Is Okta buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting Okta's revenue to grow 18.3% year on year to $534.3 million, slowing down from the 43.2% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.21 per share.

Okta Total Revenue

Majority of analysts covering the company have reconfirmed their estimates over the last thirty days, suggesting they are expecting the business to stay the course heading into the earnings. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 5.23%.

Looking at Okta's peers in the cybersecurity segment, some of them have already reported Q2 earnings results, giving us a hint of what we can expect. Rapid7 delivered top-line growth of 13.7% year on year, beating analyst estimates by 1.24%, and Qualys reported revenues up 14.4% year on year, exceeding estimates by 1.05%. Rapid7 traded up 8.7% on the results, Qualys was up 8.0%.

Read our full analysis of Rapid7's results here and Qualys's results here.

Technology stocks have been hit hard on fears of higher interest rates and while some of the cybersecurity stocks have fared somewhat better, they have not been spared, with share price declining 10.8% over the last month. Okta is down 5.76% during the same time, and is heading into the earnings with an analyst price target of $91.5, compared to share price of $72.43.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.