Okta Q2 2025 Earnings Report
Key Takeaways
Okta's Q2 2025 revenue grew by 16% year-over-year, with subscription revenue increasing by 17%. The company achieved GAAP profitability for the first time, with operating cash flow of $86 million and free cash flow of $78 million.
Q2 revenue grew 16% year-over-year; subscription revenue grew 17% year-over-year
Current remaining performance obligations (cRPO) grew 13% year-over-year to $1.995 billion
Achieved record profitability including GAAP profitability for the first time
Operating cash flow of $86 million and free cash flow of $78 million
Okta
Okta
Okta Revenue by Segment
Forward Guidance
For the third quarter of fiscal 2025, Okta expects total revenue of $648 million to $650 million, current RPO of $1.985 billion to $1.990 billion, non-GAAP operating income of $118 million to $120 million, non-GAAP diluted net income per share of $0.57 to $0.58, and Non-GAAP free cash flow margin of approximately 20%. For the full year fiscal 2025, the Company now expects total revenue of $2.555 billion to $2.565 billion, Non-GAAP operating income of $535 million to $545 million, Non-GAAP diluted net income per share of $2.58 to $2.63, and Non-GAAP free cash flow margin of approximately 23%.
Positive Outlook
- Total revenue of $648 million to $650 million, representing a growth rate of 11% year-over-year
- Current RPO of $1.985 billion to $1.990 billion, representing a growth rate of 9% year-over-year
- Non-GAAP operating income of $118 million to $120 million, which yields a non-GAAP operating margin of 18%
- Non-GAAP diluted net income per share of $0.57 to $0.58, assuming diluted weighted-average shares outstanding of approximately 183 million and a non-GAAP tax rate of 26%
- Non-GAAP free cash flow margin of approximately 20%
Challenges Ahead
- All periods factor in a challenging macro environment
- Continue to incorporate some conservatism as the Company monitors potential impacts related to the October 2023 security incident
- Global economic conditions have in the past and could in the future reduce demand for our products
- We and our third-party service providers have in the past and could in the future experience cybersecurity incidents
- Customer growth has slowed in recent periods and could continue to decelerate in the future
Revenue & Expenses
Visualization of income flow from segment revenue to net income