Okta 2020 Q4 Earnings Results

Okta Inc. (NASDAQ:OKTA) was founded in 2009 by Todd McKinnon and Frederic Kerrest to provide workforce identity services over the internet. The company has grown at an exceptional rate since its creation. Okta went public in April 2017 by pricing 11 million shares at $17 per share. Its stock price has climbed more than 930 percent since its IPO, with the current share price hovering around $270.

Like rival software companies, Okta also enjoyed strong demand for its services during the last year. As an increasing number of people started working from home following the Covid-19 pandemic, many enterprises signed up for Okta’s workforce identity tools to manage online permissions for employees working from home. OKTA stock value rose more than 110 percent during 2020.

Okta this month announced mixed financial results for the fourth quarter. The company reported a loss of 58 cents per share for the three months ended January 31, wider than a loss of 42 cents per share in the year-ago quarter. However, on an adjusted basis, OKTA earned 13 cents per share, while analysts were looking for a loss of 1 cent per share.

On the bright side, revenue for the quarter increased to $234.7 million, translating to a surge of 40 percent from the comparable period of 2020. Analysts were expecting OKTA to report revenue of $221.8 million.

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However, OKTA’s financial outlook for the first quarter was below the consensus forecast. The company expects to report an adjusted loss in the range of 21 cents per share to 20 cents per share and revenue between $237 million and $239 million for the current quarter. On the other hand, analysts were looking for a loss of 6 cents per share on $237.3 million in revenue.

The disappointing Q1 outlook sent OKTA shares down more than 5 percent in the mid-day trading Thursday.

Separately, OKTA announced that it is acquiring identity-platform company Auth0 in a transaction valued at $6.5 billion. The deal is expected to close by the end of its fiscal second quarter.

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