Billion Dollar Unicorns: Okta Delivering Decisive Growth Post IPO

Grand View Research report published earlier this year estimates the global identity access management market to grow 14% annually over the next few years to reach $24.6 billion by 2022 driven by the increasing demand for regulatory compliance and the continuing growth of web applications, Bring Your Own Devices (BYOD), and Internet of Things (IoT) markets. Billion Dollar Unicorn Okta (Nasdaq:OKTA ) is already benefiting from this growth trend.

Okta’s Financials

Okta recently reported record first-quarter results. For the quarter, revenues increased 60% to $83.6 million. It ended the quarter with a non-GAAP net loss of $0.09 per share. The market was looking for revenues of $78.8 million and a net loss of $0.16 per share for the quarter.

By segment, subscription services revenues increased 59% over the year to $76.8 million. Professional services and the others segment contributed the remaining $6.8 billion in revenues compared with $4 million recorded a year ago.

Among operating metrics, Okta now has more than 4,700 customers, up 40%. During the quarter, it added 350 new logos and 56 new customers in the $100,000-plus category.

For the current quarter, Okta forecast revenues of $84-$85 million with a net loss of $0.21-$0.20 per share. The market was looking for revenues of $84.8 million and net loss of $0.19 per share. The company expects to end the year with $353-$357 million in revenues and non-GAAP net loss per share of $0.58-$0.54. The Street had estimated revenues of $356.5 million and a net loss of $0.56 per share.

Okta’s Product Expansion

Okta may not be profitable yet, but it has managed to build a product that has received tremendous market appreciation. For the second consecutive year, Okta’s platform was ranked as a leader in Gartner’s Magic Quadrant for Access Management.

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To keep this pace, Okta continued to announce more product innovations. Last quarter, it released ThreatInsight, a solution that will leverage a new set of contextual access management features that will allow organizations to replace the use of passwords with stronger authentication for employees, partners, and customers. It offered enhanced security for developers with the launch of Sign In with Okta, which is an alternative to Security Assertion Markup Language (SAML) and will simplify single sign-on for IT admins. Okta continued to expand through tie-ups and recently announced partnerships with VMware, Workplace by Facebook, and the Onramp initiative. The tie-ups will allow IT admins to manage access to data in apps and services with one click from the Okta Integration Network.

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