Okta, Inc. SEC 10-Q Report
Okta, Inc., a leading provider of identity management solutions, has released its latest Form 10-Q report, showcasing robust financial and operational performance. The report highlights significant growth in revenue, improved profitability, and continued expansion of its customer base, despite facing challenges such as cybersecurity incidents and macroeconomic uncertainties.
Financial Highlights
Total Revenue: $728 million, increased by 13% compared to the same period last year, driven by volume-driven increases from new business and sales of additional solutions to existing customers.
Gross Profit: $560 million, representing a gross margin of 77%, improved from 76% in the prior year due to improved spend efficiency.
Operating Income: $41 million, compared to an operating loss of $19 million in the same period last year, reflecting improved operational efficiency.
Net Income: $67 million, compared to $29 million in the same period last year, indicating strong financial performance.
Business Highlights
Identity Platform Growth: Okta, Inc. continues to be a leading independent identity partner, with its Okta and Auth0 platforms enabling secure connections for thousands of organizations and millions of users. The platforms support a wide range of applications and services, emphasizing the critical role of identity in security as organizations transition to Zero Trust models.
Customer Base Expansion: As of July 31, 2025, Okta reported over 7,000 integrations with various applications and IT infrastructure vendors, highlighting its extensive network and the broad adoption of its identity solutions across diverse sectors, including enterprises, SMBs, universities, non-profits, and government agencies.
Subscription Model: Okta's business model is primarily subscription-based, with approximately 98% of total revenue for the six months ended July 31, 2025, derived from multi-year subscriptions to its cloud-based offerings. This model provides predictable revenue streams and focuses on customer retention and value expansion.
Cybersecurity Incidents Impact: Past cybersecurity incidents, including those in January 2022 and October 2023, have adversely affected Okta's reputation and financial results. The company anticipates continued adverse impacts on future financial performance due to these incidents.
Macroeconomic Challenges: Okta is navigating economic uncertainties, including market fluctuations, rising interest rates, and inflation, which could adversely affect its operations and financial results. The company is monitoring these conditions closely.
Operational Efficiency: Okta has improved its gross margin for subscription revenue to 80% for the three and six months ended July 31, 2025, compared to 78% in the previous year, driven by improved spend efficiency and lower relative costs.
Research and Development Focus: Despite a decrease in R&D expenses due to reduced stock-based compensation, Okta continues to prioritize investment in its platforms, recognizing the importance of innovation for growth.
Sales and Marketing Strategy: Sales and marketing expenses increased due to higher labor and travel costs, but as a percentage of total revenue, these expenses decreased, reflecting improved efficiency. Okta expects this category to remain its largest operating expense.
General and Administrative Efficiency: General and administrative expenses decreased as a percentage of revenue, with reductions in consulting and stock-based compensation costs, indicating improved operational efficiency.
Future Outlook: Okta expects continued growth in its customer base, particularly among larger enterprises, and anticipates that the immediate expensing of domestic R&D expenditures under the new tax law will significantly impact its financials positively.
SEC Filing: Okta, Inc. [ OKTA ] - 10-Q - Aug. 26, 2025