Okta delivered better-than-expected results for its fiscal second quarter, with shares climbing 20% in extended trading following the announcement. The company reported revenue rising 11% to reach $728 million compared with the prior year period, while net income totaled $116 million, or 65 cents per share, up from $67 million, or 37 cents per share in the comparable quarter.
The identity software provider attributed strong performance to heightened corporate investment in artificial intelligence security capabilities. During the quarter, Okta made its Okta for AI Agents tool available to all customers, with new products representing 30% of total bookings. The company said it closed dozens of artificial intelligence deals in the period, including a multi-million-dollar transaction with a healthcare organization.
CEO Todd McKinnon indicated the market opportunity in artificial intelligence agent security remains nascent, with recent high-profile incidents like the OpenAI Hugging Face hack driving increased customer interest. McKinnon stated that while network security currently dominates the cybersecurity spending landscape, identity management will likely become the primary category as millions of autonomous agents proliferate over the next five to ten years. He noted the company plans to remain focused on identity rather than broadening into adjacent categories.
Okta completed its acquisition of threat detection startup Permiso Security, valued at approximately $200 million. McKinnon indicated the company would pursue additional smaller, complementary acquisitions rather than large legacy company purchases. Subscription backlog jumped 17% year over year to $4.86 billion, exceeding analyst expectations of $4.70 billion, while backlog due within 12 months rose 14% to $2.59 billion.
The company raised full-year revenue guidance to a range of $3.22 billion to $3.23 billion, narrowly above the prior range and analysts’ $3.2 billion estimate. Adjusted earnings guidance was raised to between $3.90 and $3.94 per share, compared with Wall Street’s $3.84 estimate. Okta shares have gained 55% earlier this year amid broader strength in the cybersecurity sector.
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