Okta (OKTA) Third Quarter 2026 Financial Results Summary
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Okta, Inc. (OKTA) Q3 2026 Financial Results Summary
On December 2, 2025, Okta, Inc. (Nasdaq: OKTA) released its financial results for the third quarter of fiscal year 2026, which ended on October 31, 2025.
Key Financial Highlights
- Revenue
- Total revenue reached $742 million, a 12% increase year-over-year.
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Subscription revenue was $724 million, marking an 11% increase compared to the previous year.
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Remaining Performance Obligations (RPO)
- Total RPO expanded to $4.292 billion, demonstrating a 17% growth year-over-year.
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Current RPO (cRPO), which indicates revenue expected to be recognized within the next 12 months, rose to $2.328 billion, up 13% from the same quarter last year.
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Operating Performance
- GAAP Operating Income was $23 million, or 3% of total revenue, compared to a GAAP operating loss of $16 million (or -2%) in Q3 FY2025.
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Non-GAAP Operating Income improved to $178 million (24% of total revenue), up from $138 million (21% of total revenue) in the prior year.
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Net Income
- GAAP net income was $43 million, significantly higher than the $16 million recorded in the prior year.
- Both GAAP basic and diluted net income per share amounted to $0.24, compared to $0.09 and $0.00, respectively, from the same quarter last year.
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Non-GAAP net income rose to $152 million, compared to $121 million year-over-year, with non-GAAP diluted net income per share increasing to $0.82 from $0.67.
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Cash Flow
- The operating cash flow for the quarter was $218 million, which corresponds to 29% of total revenue, compared to $159 million (24% of total revenue) for the same quarter in 2025.
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Free cash flow was reported at $211 million, representing 28% of total revenue, an increase from $154 million (23%) year-over-year.
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Balance Sheet
- Cash, cash equivalents, and short-term investments totaled $2.463 billion as of October 31, 2025.
- The company settled the remaining principal amount of the 2025 Notes for $510 million in cash during the quarter.
Quarterly Dividend and Share Repurchase
- Quarterly Dividend: No quarterly dividend was declared during this quarter.
- Share Repurchase: No share repurchase activities were reported in the financial results.
Financial Outlook
For the upcoming fourth quarter of fiscal 2026, Okta’s guidance indicates:
– Expectation of total revenue between $748 million to $750 million, which would reflect a year-over-year growth rate of 10%.
– Predictions for current RPO to be around $2.445 billion to $2.450 billion, representing a 9% growth year-over-year.
– An estimated non-GAAP operating income in the range of $189 million to $191 million, implying a non-GAAP operating margin of approximately 25%.
– Projected non-GAAP diluted net income per share estimated at $0.84 to $0.85.
For the full fiscal year 2026:
– Total revenue is expected to be approximately $2.906 billion to $2.908 billion, showing an 11% growth year-over-year.
– The guidance includes expected non-GAAP operating income of $753 million to $755 million and non-GAAP diluted net income per share of $3.43 to $3.44.
Summary
Okta’s financial results for Q3 FY2026 demonstrate solid operational execution, reflected in growth metrics across key areas including revenue and cash flow. The company continues to enhance its position as a leading identity and access management provider while strategically expanding its offerings, including AI-driven security solutions. With encouraging forward guidance, Okta is positioned to continue its growth trajectory into the next quarter and fiscal year.
| Three Months Ended | Nine Months Ended | |
|---|---|---|
| October 31, 2025 | October 31, 2024 | |
| Revenue: | ||
| Subscription | $724 | $651 |
| Professional services and other | 18 | 14 |
| Total revenue | 742 | 665 |
| Cost of revenue: | ||
| Subscription(1) | 147 | 140 |
| Professional services and other(1) | 23 | 17 |
| Total cost of revenue | 170 | 157 |
| Gross profit | 572 | 508 |
| Operating expenses: | ||
| Research and development(1) | 160 | 158 |
| Sales and marketing(1) | 271 | 256 |
| General and administrative(1) | 118 | 110 |
| Total operating expenses | 549 | 524 |
| Operating income (loss) | 23 | -16 |
| Interest expense | -1 | -1 |
| Interest income and other, net | 28 | 26 |
| Gain on early extinguishment of debt | — | 16 |
| Interest and other, net | 27 | 41 |
| Income before provision for income taxes | 50 | 25 |
| Provision for income taxes | 7 | 9 |
| Net income | $43 | $16 |
| Net income per share, basic | $0.24 | $0.09 |
| Net income (loss) per share, diluted | $0.24 | $0.00 |
| Weighted-average shares used to compute net income per share, basic | 176,524 | 170,217 |
| Weighted-average shares used to compute net income (loss) per share, diluted | 178,402 | 170,673 |
| (1) Amounts include stock-based compensation expense as follows: | ||
| Cost of subscription revenue | $19 | $20 |
| Cost of professional services and other | 3 | 3 |
| Research and development | 49 | 49 |
| Sales and marketing | 33 | 33 |
| General and administrative | 34 | 30 |
| Total stock-based compensation expense | $138 | $135 |
| Assets | October 31, 2025 | January 31, 2025 |
|---|---|---|
| Current assets: | ||
| Cash and cash equivalents | $645 | $409 |
| Short-term investments | 1,818 | 2,114 |
| Accounts receivable, net of allowances | 463 | 621 |
| Deferred commissions | 155 | 140 |
| Prepaid expenses and other current assets | 120 | 132 |
| Total current assets | 3,201 | 3,416 |
| Property and equipment, net | 40 | 43 |
| Operating lease right-of-use assets | 64 | 74 |
| Deferred commissions, noncurrent | 280 | 267 |
| Intangible assets, net | 106 | 138 |
| Goodwill | 5,487 | 5,448 |
| Other assets | 51 | 51 |
| Total assets | $9,229 | $9,437 |
| Liabilities and stockholders’ equity | ||
| Current liabilities: | ||
| Accounts payable | $13 | $13 |
| Accrued expenses and other current liabilities | 91 | 103 |
| Accrued compensation | 173 | 207 |
| Convertible senior notes, net | 350 | 509 |
| Deferred revenue | 1,557 | 1,691 |
| Total current liabilities | 2,184 | 2,523 |
| Convertible senior notes, net, noncurrent | — | 349 |
| Operating lease liabilities, noncurrent | 73 | 94 |
| Deferred revenue, noncurrent | 29 | 27 |
| Other liabilities, noncurrent | 50 | 39 |
| Total liabilities | 2,336 | 3,032 |
| Stockholders’ equity: | ||
| Preferred stock | — | — |
| Class A common stock | — | — |
| Class B common stock | — | — |
| Additional paid-in capital | 9,519 | 9,219 |
| Accumulated other comprehensive loss | 4 | -12 |
| Accumulated deficit | -2,630 | -2,802 |
| Total stockholders’ equity | 6,893 | 6,405 |
| Total liabilities and stockholders’ equity | $9,229 | $9,437 |