Okta, Inc. (NASDAQ:OKTA) Q3 2026 Earnings Call Transcript

Okta, Inc. (NASDAQ:OKTA) Q3 2026 Earnings Call Transcript December 2, 2025

Okta, Inc. beats earnings expectations. Reported EPS is $0.82, expectations were $0.757.

Dave Gennarelli: Hi, everyone. Welcome to Okta’s third quarter fiscal 2026 earnings webcast. I’m Dave Gennarelli, Senior Vice President of Investor Relations at Okta. Presenting in today’s meeting will be Todd McKinnon, our Chief Executive Officer and Co-founder, and Brett Tighe, our Chief Financial Officer. Eric Kelleher, our President and Chief Operating Officer, will join the Q&A portion of the meeting. At around the same time that the earnings press release hit the wire, we posted supplemental commentary to our IR website. Today’s meeting will include forward-looking statements pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to statements regarding our financial outlook and market positioning.

Forward-looking statements involve known and unknown risks and uncertainties and may cause our actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking statements. Forward-looking statements represent our management’s beliefs and assumptions only as of the date made. Information on factors that could affect our financial results is included in our filings with the SEC from time to time, including the section titled Risk Factors in our previously filed Form 10-Q. In addition, during today’s meeting, we will discuss non-GAAP financial measures. Though we may not state it explicitly during the meeting, all references to profitability are non-GAAP. These non-GAAP financial measures are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP.

A reconciliation between GAAP and non-GAAP financial measures and a discussion of the limitations of using non-GAAP financial measures versus their closest GAAP equivalents are available in our earnings press release. You may also find more detailed information in our supplemental financial materials, which include trended financial statements and key metrics posted on our investor relations website. In today’s meeting, we will quote a number of numeric or growth changes as we discuss our financial performance. And unless otherwise noted, each such reference represents a year-over-year comparison. And now I’d like to turn the meeting over to Todd McKinnon. Todd?

Todd McKinnon: Thanks, Dave, and thank you everyone for joining us this afternoon. We’re pleased to report another solid quarter of results. In Q3, we experienced strength with large customers and Okta workforce upsells, particularly with new products like Okta Identity Governance. These results are driven by our unique ability to solve complex identity challenges across the entire enterprise landscape. In my comments today, I’m going to expand on our success with new products. I’ll also share how Okta secures AI, which represents a significant new opportunity and a catalyst for growth. Brett will then cover our financial performance and provide an update on the progress we’re seeing with the expanded go-to-market specialization.

Okta’s new products continue to make meaningful contributions to our results. Customers that are frustrated trying to manage sometimes dozens of different identity systems are turning to Okta for a modern, neutral, and unified identity platform. We have been investing in innovation, and our portfolio of new products is allowing customers to dramatically reduce complexity while significantly improving their security posture. New products include Okta Identity Governance, Okta Privilege Access, identity security posture management, identity threat protection with Okta AI, Okta device access, and fine-grained authorization. Many of these new products can now be delivered as part of product suites, which provide more value and further simplify the way customers can do business with Okta.

Q&A Session

We believe these new products will continue to provide incredible value to our customers and will be a growth driver for many years to come. Earlier in Q3, we had a record number of customers and partners come to Oktane in Las Vegas to hear how Okta secures AI. The simple way to think about it is that Okta is helping customers both build more secure AI agents and manage their AI agents in a secure and scalable way. The emergence of a Genentech technology is redefining the identity security landscape. AI security is identity security. AI agents represent a new powerful identity type. However, without proper security governance, they are also highly vulnerable. Securing AI agents and nonhuman identities is not a feature. It’s essential for any business looking to safely scale their deployment of AI.

If an organization does not secure its agents today, they risk undoing years of security improvements and leaving themselves vulnerable to new identity-based attacks. Okta has prioritized our efforts to focus on helping customers solve this business imperative and capture what we believe will be the next catalyst for growth and meaningful market within the identity security space. Okta’s neutral and unified platform, coupled with our installed base of over 20,000 customers, positions us best to become the identity layer for AI agents. That’s why we’re so excited about the recent launch of Auth0 for AI agents. Auth0 for AI agents allows customers to build secure agents, APIs, and users more effortlessly across their B2B, B2C, and internal app ecosystem.

Based on our conversations, customers are expecting Okta to deliver the capabilities to help build and manage their AI agents. They’re already turning to us to help guide them through the new security challenges that AI brings. Over just the past few months, we have experienced a surge in inbound interest for our AgenTek security solutions to manage agents. Okta for AI agents, these organizations are looking for a single control plane to observe and manage agents of all types in a way that offers flexibility as the technology continues to evolve. They also want a solution that gives them control, like the ability to embed fine-grain access into every agent. Okta is here to deliver. The excitement is real, and the interest is tangible. It’s very early days on this front, but we have already been engaged with over 100 of our current customers, which combined represent over $200 million in existing ARR.

To give you a sense of the interest, I want to share a great early win with Okta for AI agents. It’s with a financial services customer that is in the midst of deploying AI agents across their operations. Given the sensitive nature of their data and the need to remain compliant with the regulatory environment, securing these agents was not optional. It was critical. They selected Okta for AI agents to secure their AI footprint and provide them with enhanced visibility and remediation capabilities for the agent identities. Enforce access control, identity governance, and threat detection. It was a great win-win. Okta is helping the customer to safely deploy across their business, and the addition of Okta for AI agents represented a significant ACV uplift compared to their prior contract.

We are successfully executing on our strategy to capture this emerging opportunity, and this deal demonstrates our ability to lead the market by moving beyond human identities to securing agentic identities. Okta is the essential identity layer to help customers build, observe, and manage AI agents. We’re the only company that is able to secure AI with a modern and neutral platform, allowing us to deliver even greater value to our customers. In addition to helping customers build and manage AI agents, Okta is driving the industry to an architecture identity that is more valuable and more secure. Last quarter, you heard me talk about Okta’s role in the development of cross-app access, which brings visibility and control to both agent-driven and app-to-app interactions.

This allows IT teams to decide what apps are connecting and what information AI agents can access. I’m excited to share that as of last week, cross-app access is now an extension of model context protocol known as MCP, which helps validate that identity providers like Okta will act as the indispensable control plane for the AI enterprise. To wrap things up, we’re pleased with another solid quarter of results, and we believe we’re best positioned to win the exciting new market segment of Securing AI. In this rapidly evolving environment, organizations of all sizes are looking to Okta to deliver modern and scalable identity security solutions that can seamlessly integrate across their networks. We are confident in our strategy and enthusiastic about the momentum of the business as we head into our seasonally biggest quarter of the year.

I want to thank the entire Okta team for their tireless effort and also thank our loyal customers and partners who put their trust in us every day. And now here’s Brett to cover the financial commentary and talk about how we’re positioned for long-term profitable growth. Thanks, Todd, and thank you everyone for joining us today.

Brett Tighe: My commentary will provide insights into our Q3 performance and then move into our outlook for Q4 and FY 2026. We remain pleased with the overall progress we’re making to further specialize our go-to-market teams. Importantly, we continue to see improvement in sales productivity. Partially driving this is our average AE tenure, which has remained strong on the back of healthy attrition levels. The continued positive trends we are seeing across our go-to-market KPIs reinforce our confidence that this specialization strategy is the right path to accelerate long-term growth. Another area of sales specialization where Okta has seen strength over the past few years is the public sector. All things considered, the government shutdown didn’t meaningfully change the outcome of our Q3 results.

We remain very optimistic about expanding our presence with US government agencies as well as state and local agencies as we move forward. Over the past couple of years, we’ve done well to improve our margins to healthy levels while making investments for growth. Our disciplined investment areas remain clear: improving sales productivity through go-to-market specialization, relentless product innovation, and further leveraging our channel partners. More recently, we’ve expanded our investment areas to drive future growth by increasing the number of quota-carrying sales reps. Our recent results and business momentum give us confidence to add sales capacity in order to service the demand next year and beyond. Moving on to our balance sheet. In September, the 2025 convertible notes reached maturity, and we settled the remaining principal amount of $510 million in cash.

We had another great quarter of cash flow in Q3 and ended the quarter with a strong balance sheet consisting of nearly $2.5 billion in cash, cash equivalents, and short-term investments. We regularly evaluate our capital structure and capital allocation priorities, which include investing in the business, M&A, and opportunistic repurchasing of the 2026 notes, of which $350 million remains outstanding. Now let’s turn to our business outlook. For Q4 and FY ’26, we continue to take a prudent approach to forward guidance that factors in current market conditions. For the ’26, we expect total revenue growth of 10%, current RPO growth of 9%, non-GAAP operating margin of 25%, and free cash flow margin of approximately 31%. For the full year FY ’26, we are raising our outlook and now expect total revenue growth of 11%, non-GAAP operating margin of 26%, and a free cash flow margin of approximately 29%.

We will issue FY ’27 guidance on our Q4 earnings call, which will provide a more informed view of FY ’27, especially as we exit this quarter, which is seasonally the biggest quarter of the year. To wrap things up, we’re enthusiastic about the trends we’re seeing across the business, from the adoption of new products to customer interest in how Okta secures AI. This gives us confidence to continue making critical investments to accelerate top-line growth. We’re pleased with another solid quarter of results, and now look to close out FY ’26 strong and build on this year’s success. With that, I’ll turn it back to Dave for Q&A. Dave?

Dave Gennarelli: Thanks, Brett. I see that there are quite a few hands raised already, and I’ll take them in order until the time of the hour. And in the interest of time, please limit yourself to one question. With that, we’ll take the first question from Gray Powell at BTIG.

Gray Powell: Okay. Thank you very much, and congratulations on the good results. Can you hear me okay? It looked like I froze there.

Todd McKinnon: Not unclear, Gray.

Gray Powell: Alright. Great. So, yeah, it’s good to hear the commentary on platform momentum. And at a high level, I definitely think it makes a lot of sense. But I do have to admit, sometimes we pick up on conflicting data points in our fieldwork. Some partners say it’s great. Others are a little skeptical. So I guess from your perspective, what gets customers over the hump and convinces them to consolidate IAM, governance, PAM, customer identity, and any other components to Okta? Are there any commonalities between customers who consolidate? Can you just kind of talk about why you see those win rates?

Todd McKinnon: I think the answer is it’s always wrapped up in some other technological change. If you’re not changing your data center, you’re not changing your apps, if you’re not investing in AI, you’re not going to change identity. So in all the customers I work with, it’s about some other catalyzing technological change. For many years, it was cloud and building mobile apps and still cloud transformation too, but what we’re seeing more and more is companies are trying to move technology so they can take advantage of AI. They’re modernizing apps. They’re modernizing their security stacks so they can give AI agents access to all of their data resources, and that’s been a catalyzer. I think on the partner side, we had actually a pretty strong quarter with the partner channel.

Many of the largest deals went through a partner. It’s an area of strength. I think just compared to other companies, a lot of times, we’re not as deep and relying on partners. So maybe that’s why some of the partners are coming up inconsistently. But in increasing that reach with partners and presence with partners has been a focus. And I think on all our internal data, it’s manifesting itself prevalently. So we’re very excited about that.

Eric Kelleher: Yeah. I would add to that, Gray, and thanks for the question. I think another area to consider with customers and as far as consolidating all these use cases with Okta, as their identity partner, is enterprises as they get more and more mindful of the importance of securing identity across human, nonhuman, and agentic, they’re realizing that the legacy architectures they’ve built with multiple products or multiple vendors and multiple stacks are fragile. And with that fragility comes insecurity. It’s harder for them to have confidence they’re managing securely all their identity use cases in a way that they’re confident in their ability to protect against identity-based cyber attacks. And so they see value in consolidating on one partner with Okta so that they have confidence they’ve got a single pane of glass to manage all of that.

So by removing complex vendor distribution, consolidating on Okta’s platform, they’re able to better manage and be more confident in their security posture against threat actors.

Gray Powell: Understood. That’s helpful. Thank you.

Dave Gennarelli: Let’s go to Itay Kidron at Oppenheimer.

Itay Kidron: Thanks, guys. Solid quarter. I guess, Todd, a very interesting commentary, needless to say, about AI and the 100 customers who are trialing it. Can you give us a little bit of color on, a, do I have to be an Okta customer to specifically deploy your AI capabilities? Or those could be applied to any company even if they don’t use you for core access management, number one. Number two, when you think about the full deployment of this, how do I think about the dollar potential here when you have customers that are spending $100k with you? By how much can AI truly elevate that total bill for them?

Todd McKinnon: Yeah. I’ve been personally, and the entire company is blown away by how interested our customers and prospects are in this capability. I haven’t seen anything like this in my experience at Okta. A new capability or new product set. So it’s very, very exciting. And if you step back and think why, everyone, no surprise, big shock, they’re trying to take advantage of AI and build AI workflows into their enterprise workflows. And a lot of them are stuck. And I think it’s why you see some of the adoption rates of some of these platforms like Salesforce or ServiceNow or others is, you know, below what people want. And they’re stuck because right now, they have a couple of choices. They can either deliver agentic apps that look very much like they don’t have any access to the company’s data.

They look very much like public Gemini or public ChatGPT, generic chat bot, and they can’t get any insight from the company’s data. That’s one choice. Or the other choice is you take the company’s data and you shove it in a big data warehouse like or Databricks or Palantir, and then the agents have way too much access. They can just see everything, and they do unintended things. So people are stuck in their pause, and they’re saying, wait a minute. Not gonna roll these things out. And there’s a huge, huge number of companies that are trying to do something there, and they’re stuck. And then they come to us because what we can do is what we’re very good at is figure out who can access what. Not only for people, but now for AI agents and help them filter who has access to what, how you deploy these applications in a way that gives the right information to the agent in the right security level, lets them observe the behavior and build the right use cases for the business without over-permissioning at all.

It is early days. Like, we announced and released these products, you know, just in the last couple of months after our conference in September. So it’s early days. But we do have several deals that have been transacted for these products. We gave the example of the financial company that is rolling out these agents and purchased the product. It’s early days, but it’s incredibly exciting. And I think it’s because longer term, you look at our market, we have a $50 billion TAM for workforce identity, a $30 billion TAM for customer identity, owning and governing the agentic identity layer, and securing AI can be a bigger TAM than both of those. I mean, it’s several years out, and it’s gonna be a lot in change and growth there, which, by the way, I think one of the reasons why companies are coming to us is because it’s a dynamic environment.

You have a new model release coming out every couple of months, and Gemini is better now. OpenAI is better, and then Anthropic is better. And technology is all shifting around it. And customers don’t wanna get locked in. They’re hesitant to commit to the Microsoft stack or the Google stack. They want flexibility. And by doing this access layer in an independent neutral third party, they feel like they’re gonna have choice as this amazing platform of agentic enterprise unfolds. So it’s very exciting that we’ve the company’s number one priority now is to take advantage of this opportunity. So we’re very clear in our R&D and our go-to-market. We’re gonna focus on this opportunity. That’s how big we think it is. So it’s incredibly exciting.

Itay Kidron: Todd, do you think that the go-to-market around this can change? Meaning, instead of you selling it to the enterprise, actually talk to the agent companies and have them bundle already ahead of time your identity security with their agents such that the customer needs to do this?

Todd McKinnon: Absolutely. And we’re already doing this with trying to set the industry standards around access. We’ve mentioned before cross-app access, which is an industry standard around how you actually give access to these agents across multiple agent platforms connecting to multiple end repositories of information, whether it’s a database, a warehouse, an application. And we’re really excited that the MCP standard now recognizes cross-app access as an extension of MCP. So think about that now if you’re using MCP protocol to standardize some of these interactions between agents and resources, cross-app access fits right into that now. So it’s a very insightful question, and we’re working hard on that as well.

Eric Kelleher: And just as an example for our customers, customers that are using Auth0 for AI agents to build agents will get support for cross-app access out of the box, meaning any agents that they build with Auth0 for AI agents will be discoverable by an IDP that also supports the model context protocol. And Okta’s IDP, so it’s Okta’s IDP also supports cross-app access to model context protocol. So customers developing agents with our technology will be producing agents that any company can secure more precisely. And the Okta platform will help customers discover agents that have been deployed and then manage those agents as well. So we’re already well on the path to ensuring that we’re productizing this opportunity using our existing capabilities.

Itay Kidron: Thank you.

Dave Gennarelli: Let’s go to John DiFucci at Guggenheim.

John DiFucci: Thanks, Dave, and listen. Guys, in the past, I’m gonna ask the question that I think we’re all gonna have to answer. But in the past, you’ve given an early look to next year. And you didn’t do that this year, which I think is the right call given how much next year depends on the fourth quarter, like Brett said. I also realized that there are other reasons to give that early look because there are other things happening at the company in prior years. But even if no new numbers, you don’t give any numbers, can you give just some subjective commentary about how the world looks for Okta over the next year just generally even? Because this quarter, this quarter looks good. The stock’s down a little bit after hours because I think what I’m saying of you didn’t give that guide and people are used to it, but, you know, they’ll get over that.

This quarter does look good. It sounds like there’s a lot of even more traction. Behind the numbers happening. So just a little commentary on that would be helpful.

Brett Tighe: Todd, do you wanna take it? I can talk to the guidance I was just gonna say well, then I was gonna say about the fourth quarter is it is it is our big seasonally, it’s our biggest quarter of the year. And the opportunity is tremendous for us in Q4, and we’re very focused on executing that well across all of the product lines and all the regions and all the ways we execute in the course for the fourth quarter, and we’re set up to deliver success there. And so that’s very optimistic. Brett, maybe you can talk about the just a little bit of guidance philosophy.

Brett Tighe: Well, I was actually gonna touch John on just the business momentum. Before I get into the guidance because I think that’s more of your question than I’m happy to give it to you, which is, you know, look, Q3 was another really solid quarter for us. You heard Todd talk about it. You heard Todd me talk about it. Sure Eric will touch on it throughout this call, but we’re pleased with the traction that specialization is getting. We’re seeing that a productivity number, the number you’ve heard me talk about for years now, get into a region that we’re quite pleased with. Yes. It’s not perfect everywhere. But it is exciting to see it from an overall because that means the specialization is working. We’re excited about that.

And what that’s doing is that giving us that’s giving us confidence to be able to start to add more reps into the system. So, you know, for a while, that’s something you and I have talked about. I know a bunch of us on this call have talked about is do we have the right amount of capacity out in the field to be able to address the demand? And so we started adding capacity last quarter. We’ve added more in Q3. We expect to add more in FY ’27. So that tells you we have we’re gonna add more in Q4. Confidence in the opportunity for a whole host of reasons. Right? It could be what Todd has talked about earlier, you know, Okta securing AI is a massive opportunity for us. You can talk about the other new products like governance, PAM, highly regulated identities on the Auth0 side, feel like the organization is headed in the right direction, and that’s why you see us growing sales and marketing expense the last two quarters.

Year over year. That’s something you haven’t seen in a while. Because we’re having that confidence in the organization to be able to go out and address this opportunity. And so we’re excited about what we’re seeing in the business. And so, hopefully, that gives you more of the context. I’m happy to talk about the guidance. I mean, I can get into that for a second just so we’re all on the same page. Todd touched on it a second ago. Because Q4 is so large, it creates a need for us to be able to embed an amount of conservatism in there that makes a guidance five quarters out not that helpful. And, frankly, the whole point of guidance is to be helpful. If it’s not helpful, we shouldn’t do it. We’re not gonna do it this time, and we will update all of you after we get past our seasonally largest quarter of the year at the ‘4.

And so then we can give you a much cleaner look at the world and not have to embed some conservatism associated with our largest quarter. Now with that said, John, I gotta bring up current RPO because I know we’ve gotta talk about it. And if you look at if you want a number for FY ’27, or if you want to approximate a number for FY ’27, I would take a look at the Q4 guided current RPO and apply a coverage ratio to it. That annualized coverage ratio you guys have all heard me talk about for the last few years. Go ahead and take current RPO divided by the coverage ratio and then add some professional services on the top. And that’s going to get you to a rough approximation from a revenue perspective. Now, obviously, the formula the piece of the formula I haven’t given you is the coverage ratio.

That coverage ratio, I probably would use something in the region of FY ’26. So, hopefully, that gives you a little bit of John, on how the business is doing and why we’re excited and optimistic and also a little bit why we decided to hold off on giving a guidance about Q4 and, frankly, beyond Q4 for FY ’27 because we didn’t feel like it was being helpful to all of you anymore.

John DiFucci: That all makes I really appreciate all that. Thank you.

Eric Kelleher: Just a little added color commentary to Brett’s comments as well. We’ve talked throughout this year on the changes we made in February to go to market to specialize in the platforms. And we’ve talked about one of the key reasons for that strategy is we had decided that specializing in the buyer persona was important, but also that our pace of product innovation on both the Okta platform and Auth0 platform had accelerated to the point where it was just really hard for one seller to keep pace with all the capabilities coming out in the platform. And we talked in Q1 about how we were on track for our plan for this year to implement that change and absorb the cost of change management. We talked about having a solid Q2.

You’ve heard us here talk about a solid Q3. One indicator that we’ve shared of how successful we’re being executing that strategy is what Brett talked about earlier that our AE attrition right now is near a multi-year low. And our AE tenure is near a multiyear high. And AE productivity is sequentially increasing. And so when we think about how we’re doing implementing that significant shift in territory assignments and account assignments and then go-to-motion overall, we’ve got a lot of indicators that this strategy is the right strategy for us. And it’s also created space in our sellers to be able to take on new initiatives. Like, we’re talking today about Okta Secure’s AI, and how just how impressed we’ve been with how much that story is resonating for our customers right now is a hugely strategically important need.

We can attack that need now because we’ve got more focus on that particular use case for that particular buying persona. So we’re very optimistic on the strategy playing out.

John DiFucci: That all makes sense, Eric. Thank you. And it’s showing. It’s showing. Thanks.

Dave Gennarelli: Next up, we’ll go to Fatima Boolani at Citi.

Fatima Boolani: Hey. Good afternoon. Thank you for taking my question. Can you hear me okay?

Todd McKinnon: Loud and clear, Fatima.

Fatima Boolani: Great. Todd, this one’s for you. We’ve been really fascinated with the broader themes around agentic commerce. So I wanted to get your pulse on where the portfolio is most relevant to capitalizing on that opportunity? And where do you see effectively your customer identity business playing a very meaningful role in that? And I guess, Eric, just to even loop you into the conversation, how are conversations with customers trending with respect to building a stack behind some of these really interesting opportunities that are gonna unfurl in the next couple of years? Thank you.

Todd McKinnon: I think it’s a big deal. I think AgenTek Commerce if you have a website, and you’re or that’s doing customer support or ecommerce, you’re gonna have some version of agents on there very quickly if you don’t already. And if you’re building those agents, Auth0 for AI agents is the right solution. It shortcuts the ability to have those agents connect to multiple systems on the back end. It helps you put fine-grain authorization inside of your agentic flow, so it’s purpose-built and we’re, I think it’s a big trend we’re talking about here. It’s the same trend we’re talking about here. You know, whether you’re managing agents for internal deployment to help get work done in their enterprise workflows or your on your B2C use cases moving toward a more agentic interface versus the person interface in the past. It’s a big trend we’re talking about.

Eric Kelleher: Yeah. And I’ll add to that. We talked about at our in the quarter at our user conference talk team, we talked about the customer conversation around this challenge, and we shared a survey that we had run of a few hundred enterprise customers reporting that 91% of them had agents in production, and only 10% of them were confident they had them secured. The need is very acute and it’s very urgent and it’s a key reason why this is elevated in such a prominent conversation. Todd talked about one example of where our customers are struggling with this, and he and fine-grained authors. So for builders of agents, they need to solve for at least two distinct challenges. One is ensuring their agents can be discovered, and the second is ensuring that agents are only authorized to do specific things, that they have access to specific corporate assets and not others.

And Auth0 provides the capabilities to solve both of that with support for cross-app access and model context protocol. Agents built through Auth0 can be discovered and managed properly. And Auth0’s fine-grained authorization allows agents to be built in a way that their privileges can be very finely tuned, which is hugely important to our customers in that space. But the second part of that challenge that our customers have is they don’t know. They tell us they don’t know what agents are deployed in their environment. They don’t know what their users have turned on and what their users’ agents don’t have access to. And this is the challenge of discoverability and being able to discover agents. So on the Okta platform side, identity security posture management product scans corporate networks to find service accounts and the privileges of those service accounts, but it will also now help discover agents that are implemented and deployed as long as they support the cross-app access protocol, the extension to MCP.

So the problem of discoverability is something they need help with, and we’re well positioned to help them with that. And the other related challenge is not only knowing that they exist, but then protecting the identity of those agents to ensure the agents can’t themselves be impersonated by a threat actor, and to ensure that those agents are properly authorized to take the actions that they’re attempting to access. So the Auth0 platform on the build side is hugely important for our customers. And the Okta platform on the discover and manage side is important for them as well. That also includes things like privileged access, allowing the agents to have tokens that are appropriately vaulted, and governance, having them provisioned and deprovisioned based on just-in-time requirements.

So they don’t agents live with standing privileges when they don’t need to be standing.

Fatima Boolani: Yeah. Commercial impact in both your businesses as opposed to what intuitively I would think would just be on the customer identity side.

Todd McKinnon: Yeah. I think, Fatima, I could think of a meeting I just had a couple of weeks ago and this was how it all comes together. So there’s this company is a large mortgage company online mortgage company. And they think about it as when people come to their website and they start browsing for mortgages, and they answer the customer’s question in an agentic workflow, and then it actually flows all the way through their origination business on the back end, which is very much workflows where people have to use human in the loop system to make approvals for mortgages that are over a certain amount. They have to maybe automate the entirety of the mortgage process so they can fulfill it without anyone, any person. So it’s like, external facing on their website in a B2C, it also goes all the way back into the enterprise.

And they want that all together, and the business value for them is very simple. It’s their conversion rates on the mortgage is up, you know, 5x if it’s there’s no delay. There’s no delay in the approval, or they don’t have to go for some other thing. So it’s a very clear ROI. And before they were talking to us, they’re really stuck on these questions we’re talking about. Like, how do we make sure that the web-facing agent has the right access to the back end systems? How do we make sure that the enterprise-facing agents have the right permissions? We automate some of those workflows and don’t over give overly permissive access to these agents in the enterprise. So it all comes together in that very concrete example.

Fatima Boolani: I appreciate that. Thank you.

Dave Gennarelli: And next up is Josh Tilton at Wolf.

Josh Tilton: Hey, guys. Thanks for sneaking me in. Can you hear me?

Todd McKinnon: You can.

Josh Tilton: You’re good, Josh. Brett, not to put you on the spot here. I do appreciate the color on how to think about next year’s revenue. To kind of simplify it without the math, bookings growth year to date is kind of growing where Street is for revenue growth next year. So, like, how do we think about that? You know, what you’re doing so far this year, what it implies for next year, are you comfortable with where the street sits, but I’m just trying to understand them. Bookings growth has been good. It’s kind of in line with the implied or where the street is for revenue next year. Like, how do you feel about where the street sits today?

Brett Tighe: I think in general, if you were to take our comments and boil them into a couple of little simple things, which is one, you can feel the business momentum growing. Right? Eric talked about it a few minutes ago around we had to make some changes at the beginning of this year to further specialize the field. Can feel that business momentum growing as we go into Q4. And we think that that business momentum on the back of us specializing the field is helping in addition to the market seems to be in a good place for us for all these new products, whether it’s Okta securing AI, whether it’s governance, or all these new products that we’ve talked about over the last several quarters. So I don’t have an exact answer for you in terms of the street is and bookings growth and all that sort of stuff, but the really important thing is you can see the growing confidence in the organization.

And you can see the productivity. You can see the optimism. You can see all these things. Headed in the right direction, and that’s why you can kind of hear the tone from the three of us and the way we’ve been talking about it. Throughout this call as being very positive, and we feel like the goal that we’ve been talking about for a while of accelerating growth in the medium term is something that is on the horizon for us, which is exciting. I’m not saying when it’s gonna happen or how it’s gonna happen. I’m just saying that we do feel that that business momentum is headed in the right direction, and that’s why we’re adding capacity, like I said, a few minutes ago to go out and address that demand.

Josh Tilton: Super helpful. Thank you.

Dave Gennarelli: No problem. Next up is Jonathan Ho at William Blair.

Jonathan Ho: Hi. Good afternoon. Wanted to see if you could update us a little bit on your sales realignment efforts earlier this year and how, you know, maybe the product suites have had an effect on that go-to-market. Lastly, how do we think about sort of the pace for net retention over time? It’s been sort of sitting at this 106 level for a bit. I know that’s from prior periods, but how do we think about maybe the mechanics of that recovery? Thank you.

Eric Kelleher: Yeah. Hi, Jonathan. I’ll take the first part of that question. I’ll let Brett take the second part. The go-to-market specialization for us is as we’ve said throughout this call, we feel it’s been very effective. And there’s a few ways that that has played out for us. On the front end, the top of the funnel, we have specialized our demand gen teams for their brand generation work, their pipe generation work, and we are pleased with the pipe that we’ve been able to generate in the business. We also have had more focus on our distinct personas. So we’ve had an opportunity in our field to get closer to the very specific granular needs of our CIO and CSO buyers and of our developer. And we’ve been able to focus our R&D efforts on the Okta platform and the Auth0 platform on those personas.

And so we’ve seen significant innovation improvements tying specifically more specifically to a discrete buying persona. Which has allowed us to continue to capture market. Things like Okta customer identity, which we talked about last quarter, has really come back as part of our refocusing on the Okta platform for the enterprise buyers. So that specialization has been very helpful. One of the questions this group has raised in prior quarters is how the field organization was feeling about specialization, whether they felt this was a positive or something that was a concern, their ability to be successful. And as I mentioned earlier, we’re seeing right now our sales is near a multiyear low, and our sales tenure is near a multiyear high. We’re feeling very confident in not only in the model’s capability to produce financial results, but we’re feeling very confident that our own field organization is very engaged and feels that they’re being successful in this model, which is what we expected, and we’re pleased to see it playing out the way that we expected.

Jonathan Ho: Yeah.

Brett Tighe: Okay. So I’ll talk about NRR in a second, Jonathan. But the thing that Eric was saying made me think of around the specialization. One of the reasons why the new product introduction percentage has remained quite healthy is as a percentage of total bookings, you know, we’ve talked about it over the last three, four quarters. Because people are starting to really get into the details on the product to be able to sell it directly to a specific economic buyer, and it helps them just be more familiar with anything. Anytime you’re more familiar with something, you’re probably gonna be better at it. And so that’s been the theory behind why we did this, and it seems to be playing out in that regard.

Jonathan Ho: And that’s a great call out.

Brett Tighe: In terms of the NRR, the one thing I would say before we get into NRR is gross retention remains healthy. It’s one of those things that we’re quite proud of. And we expect to continue over the long run with that given the value that we drive for our customers day in, day out. In terms of where the range is and where it could be, you know, 106 is right in the range we’ve talked about. You know, you’ve heard me talk about it every quarter for a while now, and this is where the range we thought it was going to be. So it’s traveling in the range that we expect it to be. We probably think it tracks in this range, or we do think it tracks in this range for Q4. I don’t have a great answer for you beyond that, Jonathan, because we are still early in our fiscal year planning.

But, obviously, if we wanna grow faster, this is something we’re gonna focus on. Because it’s on the back of that strong gross retention. How can we keep doing these upsells and doing more NPI and more Okta secures AI to be able to help ourselves in that number over the long run. Obviously, there are dynamics that go in there. Like, if we sell more new business, it’s, you know, a little bit of a headwind to new NRR. And if we sell more upsells, it’s a tailwind. So there’s always a balance in that number that we should keep an eye on when we’re looking at the overall total business.

Jonathan Ho: Right. Thank you.

Brett Tighe: No problem, John.

Dave Gennarelli: Next, we’ll go to Alec Balman at Jefferies.

Alec Balman: Hi, guys. I’m on for Joe Gallo today. Thanks for taking our question. Brett, you’ve been very candid in the level of prudence and guidance the last couple of quarters. But you’ve also seen larger beats historically in 4Q over the past couple of years. So can you comment on the puts and takes to guide in 4Q? Talked about conservatism there, but just suppose to take us to it. And then also, is the guidance framework still in line with what we’ve seen historically?

Brett Tighe: Yeah. I mean, just in general, just to answer your second question first, we’re still trying to get closer to the pin. Now we had a nice beat this quarter on current RPO because the team just flat out outperformed. They did a really nice job. And so, you know, I’m happy to be wrong in that situation. But, you know, we wanna get closer to the pin. That’s been our stated goal now for several quarters. And if you look at Q4, we’ve removed any specific line items. Right now, it’s just down to market conditions and our own internal expectations. So it’s real simple. And we’re looking forward to executing in Q4 as best we can because you’ve heard us talk about it. It is our seasonally largest quarter, and we wanna finish a strong FY ’26 with a bang.

Dave Gennarelli: Great. Next up, we’ll go to Shrenik Kothari at Baird.

Shrenik Kothari: Yeah. Thanks for taking my question. There was a question on consolidation and then a lot on agent. Try to combine the two. Like, I believe as you guys head into ’26, planning cycles, and, Todd, you did mention there’s a desire for a single control plane to manage a GenTech as well. Are you seeing signs that buyers are also thinking about consolidating AI IT governance around a vendor? And just based on whatever you saw so far in terms of those 100 plus engaged customers, can you walk us through, like, the typical conversion timeline from interest towards the ACV booking ARR? Thanks.

Todd McKinnon: Yeah. You’re right. The two trends are very related. This thinking about the agentic future for these customers and then thinking about what that means for their identity stacks in the short term. We’re working with one of the largest Fortune 50 customers of ours on a wholesale replacement of Ping Identity, SailPoint, CyberArk, and several other identity vendors across our whole stack to standardize on Okta products. And the driver there is two things. It’s cost. They wanted to have less cost in their environment, and they wanted to have more better functioning integrated products. That’s part of the driver, but the bigger driver was something very simple, which is this company has 5,500 applications. And only all these years these legacy vendors, they only had 500 of them hooked up to their central identity system.

So they’re thinking about an agentic future where they wanna give their agents and their agent infrastructure access to every application that they have. And they only had a paved path for 1,500 of them because they only were able to get that many on their identity platform with the old technology. So when they think about standardizing, they think about moving all 5,500 applications to Okta. And then that cuts cost. It makes the system work better because governance is integrated to access management, is integrated privilege. But more importantly for them, I think it enables this agentic future where they can give access in a controlled, governed, managed way to all these agents doing all these workflows. That’s behind the standard IDP. So they’re all kind of interrelated, but I think they all point north for which is a very good position to be in.

Dave Gennarelli: Next up, we’ll go to Brad Zelnick at Deutsche Bank.

Brad Zelnick: Great. Thanks a lot, David. Nice to see everybody. Guys, in Q3, I think you’ve added more headcount this quarter than you have in three years, which I take as an expression of confidence. Especially knowing how devout followers you guys are about rule of 40. That’s in addition to a lot of other constructive commentary tonight. But just to follow on to Fuji’s question and Josh Tilton’s question as well, if I take, Brett, your comments on CRPO coverage ratios, quick back of the envelope gets me to, like, nine and a half percent revenue growth for next year. And I just wanna make sure that I heard you correctly and I’m interpreting that right.

Brett Tighe: Yeah. The simple math is just current RPO. Right? And you take the coverage ratio and the coverage ratio just to make sure everyone is clear on what that is. We could let’s say we can let’s calculate the FY ’26. Coverage ratio together. All you do is you take Q4 FY ’25 current RPO, and you divide it by next year’s use the guide or the no. I’m saying for the coverage ratio that you’re gonna apply to current RPO. Right? Because it’s current RPO guidance, times the coverage ratio, plus professional services.

Brad Zelnick: Yep.

Brett Tighe: K. So you’ve got Q4 current RPO guidance. We just gave it to you. Right? $2,450,000,000. Yep. The coverage ratio is the most important factor in the math that you don’t we don’t have an exact number for, but I’m trying to give you a rough approximation. And if you wanted to use have to use FY ’26, but it’s the closest in years, so might make sense or somewhere in that ZIP code. So the FY ’26 version, all it is is Q4 FY ’25 current RPO, which was $2,250,000,000 and you divide that by the FY ’26 subscription revenue and that’s gonna get you a number. We haven’t given you a guide for a subscription revenue, but you can figure it out, Brad. It’s I got pretty easy. That number is probably about seventy-nine percent or thereabouts.

Brad Zelnick: Understood. And then you just put that in the formula. And then professional services, I think, guys can come up with a rough estimate. And then that’s all you do. So Q4 FY ’26, 2.45 divided by point seven nine plus whatever you’re gonna put in for professional service. I’m giving you advice to use FY ’26 as a rough approximation. I’m not saying that’s what you have to use. Just seems logical given it’s the closest year to what we’re about to do in FY ’27. That’s all.

Brad Zelnick: Totally get it, and I appreciate you making it very clear. Maybe just on the other part of my question. When I see you guys hire like this, it really, to me, makes a statement, and I wanna make sure I’m interpreting that signal the right way. Am I to assume that the bulk or strong mix of those headcount adds are go-to-market? Is there anything else to know about the composition of all those heads that you’re you’ve added in Q3?

Brett Tighe: Yeah. It’s a mix of both go-to-market because of what we’ve talked about already today and then also continuing to add into some of the lower-cost regions. Be able to bulk up the capacity in places like R&D. Or other areas that can help us be able to build product faster or in G&A, be able to become more efficient and be able to get through things faster. So it’s really a variety of areas for us, but it’s really go-to-market and then lower-cost regions are really the two places that we’re adding in. You’re on mute there, Brad.

Brad Zelnick: Thanks very much.

Brett Tighe: No problem. My first ever algebra lesson on an earnings call. Thank you, Brett.

Brett Tighe: Brad wanted to dive in, so I felt like it was necessary.

Dave Gennarelli: Alright. Next up, we have Yoon Kim at Loop Capital.

Yoon Kim: Alright. Thanks, David. Hey, Todd. So for some of the early adopters of AI agents that you’re working with, are these agents from software vendors like Salesforce and ServiceNow or are they custom-developed AI agents? And is your approach to securing AI agents different for these two types of agents given that Auth0 for AI agents is really targeted at developers?

Todd McKinnon: It’s a really good question, and it’s every customer we talk to, they’re worried about all of the above. I would say that the actual most concrete implementations are agents they’ve built themselves. I think that the deployment from some of the package application vendors you talked about are maybe a little bit more behind. Of deployments. But the ones the companies that are building their own, that’s their first and foremost concern. But everyone’s concerned about they know it’s gonna be a multi-platform world in this. There’s so much value to be delivered. There’s so many frameworks. There’s so much innovation. There’s so many models. They understand that it’s gonna be a multiplatform world, which is why our message is really resonating, which is, like, hey.

If you get identity security and a GenTech security is absolutely critical, you can’t just give agents access to everything. You have to govern and control and monitor the access. Now if you choose to do that in one security platform or one cloud platform, everyone understands that you’re gonna be it’s gonna be strong lock-in. You’re gonna be stuck with those models, those frameworks. And have gravity in that environment. And people are leery of that because they know that it’s a fast-moving environment, and they you know, it’d be kinda like when I talk to customers, it’d be kinda like you had to choose one streaming platform. You just won and you couldn’t switch. What would you choose? Right? You’d be careful because all the good stuff is on the other one.

Like, you choose Netflix, you’d wanna go over to Prime. If you Prime. You’d wanna go over to Paramount, and they don’t wanna choose one platform. They want flexibility. They wanna be able to use different platforms and pick the best content off of different platforms. So that’s really resonating with customers, which is what’s driving this interest, which is why we’re working so hard to capitalize on.

Yoon Kim: Okay. Great. Thank you.

Dave Gennarelli: Next, we’ll go to Mike Cikos at Needham.

Mike Cikos: Great. Thanks for taking the question here, guys. I just wanted to come back to the net retention comment. Understood on you guys are in that ZIP code around the 106. But I think historically, the company has not incentivized or split up the team between hunters or farmers and allowed sales reps to choose how they wanna retire quota. Could you just provide an update for where we are in thinking about the sales capacity you’re hiring? Are we thinking about setting up a specific team focused on new logo acquisition or first orders, or is it still and I guess, let the reps choose, are we putting in place any sweeteners of any kind? I just wanted to get an update on that front.

Eric Kelleher: Yeah. Thanks, Mike. We have in fact started looking at and carving territories for new logo acquisition. We announced a year ago that we were bringing a hunter-farmer assignment into, at that time, our US commercial business. And we talked last quarter, then six quarters into that change, how that was progressing. We’re very pleased with the productivity of how that’s been carved off. That was in the US commercial business. We have not extended that into our enterprise business yet. We’re seeing rather the focus of platform specialization on the buyer is allowing our reps to balance both new logo acquisition and getting deep within their existing accounts. But that’s always something that we look at. And as we look for opportunities to expand new logo acquisition, thinking about adding hunter capacity as part of our planning process every year.

Mike Cikos: Excellent. I’ll keep it to one. Thank you.

Todd McKinnon: Yeah. I think a lot of the growth and a lot of the focus and planning is on larger deals. You saw the cohort of million-dollar deals this past Q3 grew 17%. Very excited about that. And in general, a lot of our growth and focus is gonna be on larger deals. Sometimes with our products now, that can be in a segment of smaller customers, but most of the time, it’s in a larger enterprise or strategic account patch. And so just in general, that’s where the business is going. That’s where the growth is, and that’s where we’re investing.

Dave Gennarelli: Let’s go to Tomer Zuberman at BofA.

Tomer Zuberman: Hey, guys. Yeah. I think you’ve previously spoken about the opportunity to price AgenTeq as an extension of a per-seat license. But we’ve been hearing in the market some concern around seat count reductions at customers. So one, as you think about your opportunity next year and you’re doing your planning, are you seeing any concern around that with your customers? And two, how do you think about the offset of any potential reduction of headcount versus the opportunity to upsell AgenTeq?

Todd McKinnon: The AgenTeq products are priced similarly to our current products. Our current products are priced per user. The AgenTeq products are priced per agent. So sometimes that can be a one-to-many relationship. You might have a few agents for a person. Sometimes they might be agents on their own. So I think we’re set up in a way that gives us flexibility as these things evolve in terms of how companies wanna deploy agency to augment headcount, what they wanna how they wanna deploy agents. At the front end of processes before it ever gets to a person. This is one of the advantages we have with all these customers and all this interest. We can figure this out quickly, and we can iterate on this quickly, and that’s how we’ve gotten to this pricing model.

Because this is a new thing. You know, it’s exciting because a lot of the traditional vendors you know, it’s like being locked in or being owning a certain market, it’s not it’s not owned yet. We have the opportunity to win this massive new market, and we’re well positioned with the customers and with the products and with what people expect us to do. And we’re gonna go out and define it and win it, and it’s gonna be really exciting to do that.

Eric Kelleher: And the other comment I’d add to that, Tomer, is we feel very well diversified from a use case and product perspective. So to the immediate question, we are not, you know, like everyone, we’re looking at what changes will happen in the global workforce at companies as they lean more on AI and technology to run their businesses. We’re not yet feeling a material headwind from some you mentioned seat reductions in the business, but were we just to see that we’re confident in our customer identity business offsetting that. We’re confident in our agentic identity business offsetting that. So in the aggregate, we view this shift in the industry as net upside for Okta. And everything you’ve heard us talk about in our product strategy today and our focus of innovation the conversations we’re having with customers is embracing the in to help them solve an emerging, very acute urgent customer need for securing AgenTeq identity.

We see that as upside to the overall business, not as just for replacing the existing business.

Tomer Zuberman: Got it. Thank you.

Dave Gennarelli: Next, we’ll go to Joe Vandrich at Scotia.

Joe Vandrich: Yep. You got Joe Vandrich on for Patrick Colville here. Todd, you mentioned a surge in inbound interest for managing agents. So can you talk about what’s getting more traction? Is it the Auth0 solution? Or the workforce side? And then what do you think represents the larger opportunity and why?

Todd McKinnon: I think they’re both getting about the same amount of traction. I think it’s a little bit different. I think a lot of the interest in the AI agents, it’s more online. You know, developers. Right? So they find out about it on the website. They do self-service, upgrade to enterprise, a little bit of a different motion. The Okta for agents, which is for IT and security, it’s very much you know, have an enterprise architecture with a CSO or security influence buyer or an IT influence buyer. So they’re both getting interest, but all it’s pretty early on both of them. We resist the urge to draw too many patterns on the couple of months. It’s really been out there in the market. And we’re really on ourselves on being able to iterate quickly and adjust as we define this market and make sure we not only deliver something incredibly valuable for customers, but something that’ll take advantage of both of these personas, which is IT on one side and then developers on the other.

Joe Vandrich: Thank you.

Dave Gennarelli: Got about four minutes left. Let’s try to get the last three questions. Next up, we have Rudy at DADCO.

Rudy Kessinger: Hey. Great. Thanks for taking my questions, guys. Brett, I wanna go back to a comment in the script on sales productivity. You said you are continuing to see improvements there. Is that you know, was it improved quarter over quarter? Was it improved year over year? I’m curious on that. And then secondly, on the sales hiring front, certainly, we’ve seen that. Your sales job openings up over 100% year over year the last couple of months, and our data. What is the level of sales capacity additions you’re planning to add? You know, I’m not sure what time frame you wanna use last quarter through Q1 or you know, just what’s the level of sales capacity addition you’re looking to add as you think about the FY ’27 plan? Thank you.

Brett Tighe: Yeah. Absolutely. And I’ll let Eric step in a little bit here too on productivity. But to answer your question, it is up quarter over quarter and is up year over year. And so it’s all of the above, Rudy, which is a good sign for us. And also, at the same time, like I said, we added capacity in Q3, and we started to add capacity in Q2. In terms of the exact numbers of how much we’re gonna add, we’re gonna be methodical about that. We wanna make sure that we are maintaining high productivity and not overdoing it. In terms of adding in capacity. Because as Eric told you a second ago or whatever, twenty minutes ago, you know, our AE attrition is quite good right now. Our tenure is quite good. We don’t wanna disrupt that, and so we wanna be methodical in our approach to add the capacity into the system.

Make sure it works, and then move on. Evaluate the success, and then step onto the next level of what we think is possible because we do have a great field right now. We are very confident. Great. Actually, I should’ve said this at the beginning of the call, great job at a sales team. And all the go-to-market teams in Q3, and we look forward to having them execute in Q4. So yeah, I think that pretty much covers it, Rudy. I don’t know if Eric, you’d have anything else to add.

Eric Kelleher: You hit the key points. I would say in addition to productivity being up, it’s implied with your comments, Brett, but attrition is down. And so from a field engagement standpoint, we feel quite positive with our team’s ability to be successful and their belief that they can be successful. So as we add capacity, we wanna make sure we add it in a metered fashion to ensure that we’re confident our field continues to have the opportunity to be very successful with Okta. So that is an important part of our philosophy because we don’t want to see a return to where attrition starts to creep back up. We wanna keep our tenured reps because they’re much more productive.

Rudy Kessinger: Super helpful, guys. Thanks, and congrats on the quarter.

Brett Tighe: Thanks, Rudy.

Dave Gennarelli: Next, we’ll go to Taz at Roth.

Taz: Taz, you there?

Dave Gennarelli: Now let’s quickly go to Gabriela at Goldman.

Gabriela Borges: I’m here. Can you guys hear me?

Dave Gennarelli: Oh, here we go. K. Let’s go to Gabriela, and then we go finish off with Taz.

Gabriela Borges: Todd, I wanted to ask on this topic of agents that are bespoke versus from the package software vendors. And when we start to see adoption from the package software vendors, how do you think about the identity functionality that may be embedded in the application? And this is in the context of ServiceNow announcing their plans to acquire VEZ this morning. Thanks.

Todd McKinnon: Yeah. One of the interesting things about being the clear leader in identity security is we kinda have a right of first refusal on all the acquisitions. So we looked at Vesa. It’s interesting. It’s a pretty narrow use case in terms of identity management. And the big picture idea is what’s gonna be, like, the system of record for access. And to do that, you really have to have an IDP sitting in the middle of the transaction to really get the governance and control. So I think you’re gonna see what’s played out a lot of times over the last ten years, Gabriela, is every platform company is gonna try to take their own identity from their own platform. And make it generalizable. Sometimes they’ll buy something. Sometimes they’ll try to build it themselves.

But it’s really hard to cover all the use cases and cover all the integrations to all the different systems and environments. If you’re not totally focused on it. And I think you’ll continue to see that benefit us for a long time.

Gabriela Borges: Thanks very much.

Dave Gennarelli: Okay. We’ll take the last question from Taz at Roth.

Taz: Thanks, guys. Thanks for squeezing me in. I got two questions. Todd, first one for you. You mentioned the customer example with the large AI deal. And my question is can you talk about the, you spoke about one-to-many relationship between humans and agents. Can you talk about what that was in that scenario? And maybe kind of bake off a competitive landscape? Like, who are the other players involved in that deal? For AI security?

Todd McKinnon: Yeah. I think we just it’s pretty simple. I think a lot of companies think about agents as, you know, like, software engineering is a great example. As a software engineer, you’re gonna have these agents working for you all the time. They’re gonna be reviewing code. They’re gonna be doing security reviews. They’re gonna be checking code in. They’re gonna be running tests. And all those agents are gonna be working on your behalf in some cases and have their own identity in others, and it’s just having the flexibility to support all those different use cases in addition to agents that would just run on their own. Customer support agents or your agents sitting on your website, accepting commerce are gonna be on their own. Gonna need access control, but they’re not bound to a user until maybe it gets lower down in the workflow. So all those.

Taz: What’s that relationship been? So, like, in the example that you’ve seen so far, what’s it, like, one to ten, one to 20? And if you compare the human agents that you have or the human entities that you have, versus the agent that you secure, is that number is there a ballpark number that you have seen so far in the companies that you’ve sold to?

Todd McKinnon: I think it’s, like, five to ten per person.

Taz: Cool. Got it. Brad, just one for you. Even as growth has slowed down in the last few years, margins have gone up quite a bit. And if you look at your, you know, margins plus revenue growth, you’ve always been above that rule of 40. Should we expect that to continue going forward in fiscal twenty-seven? Do you expect that rule of 40 to sustain? I know you didn’t give us a revenue guide. You gave us some ballpark guide, but combining that with what to expect for free cash flow, multiple margin next year, should we expect that rule of 40 to sustain going forward?

Brett Tighe: Yeah. I mean, from an overall perspective, we are gonna continue to employ the rule of 40 frameworks when we manage the business, something we’ve been quite consistent with, I guess, is probably the right way to put it. And as you said, we have a tremendous amount of margin increase over the last three years. Thank you for saying that, Taz. I really appreciate it. When we look at the overall formula, I’m not gonna be able to comment on what we’re gonna do next year for FY ’27. Let’s get through the plan, and let’s get through Q4 and see how everything goes. I’ll give you an update then. But, ultimately, when you think about it, we wanna lean into the growth side of the equation more. You’ve heard us talk about that.

That’s been our goal is to accelerate growth. For quite some time. You can hear the optimism from the call today about that desire and confidence. And so we’re still gonna manage through that rule of 40, but we really wanna lean more into that growth acceleration side of the house. And once we have our finalized plans for FY ’27, I’ll be able to give you some more succinct detail at the next earnings call.

Taz: Very helpful. Thank you. Thanks, guys.

Dave Gennarelli: Well, thanks, everybody. But before you go, just wanna let you know that Okta will be hosting several on-site and virtual bus tours in December and January. And we’ll also be attending the virtual Needham Growth Conference on January 8. So we hope to see you at one of those events. Thanks, everyone.