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Corporate identity management software company Okta (Nasdaq: OKTA) recently announced its second quarter results that continued to outpace market expectations. The company improved its outlook for the rest of the year as well, sending the stock soaring more than 10% in the after-hours trading session.
 

Okta’s Financials

Revenues for the second quarter grew 23% to $556 million, surging ahead of the market’s forecast of $534.06 million.  EPS was $0.31, significantly better than the Street’s estimate of $0.21 per share.

By segment, subscription services revenues increased 24.6% to $542 million. Revenue from the Professional Services and Others segment fell 17.6% to $14 million.

Among key metrics, Remaining Performance Obligations (RPO) grew 8% to $3.03 billion.

Okta expects to end the third quarter with revenue of $558-$560 billion and non-GAAP net loss of $0.29-$0.30. The market was looking for revenues of $560.86 million and a net income of $0.30 per share.

For the fiscal year, Okta forecast revenues of $2.207-$2.215 million and an EPS of $1.17-$1.20 per share. The market was looking for revenues of $2.22 billion for the year with a net income of $1.19 per share. Earlier this year, Okta had forecast earnings of $0.88-$0.93 a share on revenue of $2.18-$2.19 billion for the year. Okta’s management believes that while macro headwinds will continue during the year, it has “found stabilization” to be able to predict a better outlook.
 

Okta’s Product Upgrades

During the quarter, Okta announced the early access release of Okta Device Access, a new product that enables organizations to extend Okta’s Identity and Access Management (IAM) capabilities for secure access to corporate devices for a hybrid workforce. Device Access will be a part of Okta’s Workforce Identity Cloud and will deliver stronger authentication to unlock a device so that organizations can simplify the login experience for employees.

The solution is part of Okta’s broader effort to move the industry beyond traditional multi-factor authentication (MFA) to enable phishing resistance and passwordless capabilities. The solution is launching with two critical capabilities:

(1) Desktop MFA for Windows and macOS that will extend Okta’s MFA policies to the desktop login to strengthen the zero trust strategy, and

(2) Desktop Password Sync for macOS that has been built in partnership with Jamf and on top of Apple’s Platform Single Sign-On Extension to securely provision local macOS user accounts with Okta credentials and seamlessly enroll users into Okta Verify and FastPass.

After its expansion into financial services, Okta is now expanding its presence in the government sector. It has announced that Okta for Government High has earned its FedRAMP High Authorization. The solution complies with over 420 baseline security controls. The certification will now allow for Okta to work with federal agencies.

Okta’s stock is currently trading at $81.46 with a market cap of $12.8 billion. It touched a 52-week high of $91.50 in May. It hit a 52-week low of $44.12 in October last year.

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