In This Article:
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Revenue Growth (Q2 FY26): Expected growth of 10%.
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Current RPO Growth (Q2 FY26): Expected growth of 10% to 11%.
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Non-GAAP Operating Margin (Q2 FY26): Expected at 26%.
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Free Cash Flow Margin (Q2 FY26): Expected at approximately 19%.
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Revenue Growth (FY26): Expected growth of 9% to 10%.
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Non-GAAP Operating Margin (FY26): Expected at 25%.
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Free Cash Flow Margin (FY26): Expected at approximately 27%.
Release Date: May 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Okta Inc (NASDAQ:OKTA) reported strong financial performance in Q1 FY26, with record operating profitability and profit margin.
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The company experienced significant growth in its governance portfolio, with products like Okta Identity Governance and lifecycle management showing substantial adoption.
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Okta Inc (NASDAQ:OKTA) saw a nearly 400% increase in workflow executions over the past three years, indicating strong integration into customer IT infrastructures.
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The company is making strides in innovation, particularly with new products like Identity Security Posture Management and Okta Privileged Access, which address evolving cyber threats.
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Okta Inc (NASDAQ:OKTA) is well-positioned in the US public sector, with strong performance in Q1 and strategic investments yielding positive results.
Negative Points
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Okta Inc (NASDAQ:OKTA) has introduced additional conservatism in its guidance due to macroeconomic uncertainties, which could impact future performance.
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The company is facing headwinds in net revenue retention (NRR), which has declined for the fourth consecutive quarter.
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There is potential uncertainty in the US federal vertical, which could affect Okta Inc (NASDAQ:OKTA)'s federal business due to economic and political factors.
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Despite strong Q1 results, Okta Inc (NASDAQ:OKTA) is cautious about the macroeconomic environment, which could impact growth in the latter half of FY26.
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The company's go-to-market specialization is still in early stages, and while initial signals are positive, the long-term success of this strategy remains to be seen.
Q & A Highlights
Q: You've layered in additional conservatism into your guidance. What factors influenced this decision, and how do you see these impacting Q1 and future quarters? A: Todd McKinnon, CEO, explained that while Q1 was strong and on track, the guidance reflects a cautious approach due to macroeconomic uncertainties. Brett Tighe, CFO, added that while no macro impact was seen in Q1, the guidance includes potential risks due to the current economic environment, maintaining less conservatism than in previous models.