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Okta (OKTA) is sharply higher after reporting its Q4 (Jan) results last night. The identity security company beat EPS expectations, while revenue increased 11.6% yr/yr to $761 mln, also better than expected. Guidance was mixed, however, with Q1 EPS of $0.84-0.86 and revenue of $749-753 mln both coming in below consensus. For FY27, OKTA guided EPS to $3.74-3.82, above expectations, while revenue of $3.17-3.19 bln was above at the midpoint, but implies a slowdown to 9% growth from 12% growth in FY26.

• RPO increased 15% yr/yr to $4.827 bln, up from $4.292 bln at the end of Q3, while cRPO increased 12% to $2.513 bln, above guidance for 9% growth but modestly below the 13% growth delivered in Q3. For Q1, OKTA guided cRPO to $2.44-2.45 bln, implying 10% yr/yr growth.
• Results continue to be driven by large customers and large deals, with OKTA closing a record $1.3 bln in total contract value in Q4 and surpassing $3 bln in annual contract value.
• Newer products such as Okta Identity Governance, Okta Privileged Access, Auth0 for AI Agents, and Okta for AI Agents continue to gain traction, supporting broader platform adoption and helping drive larger, higher-value deals.
• Specifically, these newer products represented about 30% of Q4 bookings, up meaningfully from prior quarters, and when included in a deal, drove an average contract uplift of roughly 40%.
• OKTA believes identity becomes increasingly critical as AI is embedded across more workflows and automations, increasing the number of exploitable entry points. It cited its AI at Work report showing 91% of organizations already use AI agents, but only 10% have governance in place, supporting a sizable, still-early opportunity across identity and security.
• OKTA also noted that competitive dynamics in transactions remain broadly unchanged.
• On guidance, OKTA maintained its prudent approach and is not baking in much contribution from AI agents in FY27. However, it said demand and pipeline remain solid, with incremental investment intended to position AI agents as a meaningful growth contributor in FY28 and beyond.

Briefing.com Analyst Insight

OKTA delivered an encouraging quarter, beating expectations on the top and bottom line, while cRPO also came in better than expected. While guidance was mixed, with Q1 below expectations on the top and bottom line and FY27 implying a slowdown in growth, we think investors are looking past the near-term cadence and instead focusing on the AI commentary and the larger contribution from newer products. It was particularly encouraging to see newer products represent a meaningful share of Q4 bookings and drive notable contract uplift, alongside OKTA's view that competitive dynamics in transactions remain broadly unchanged. Longer term, OKTA believes AI should only increase the need for identity, and its positioning across both identity infrastructure and security appears to leave it well insulated. It will be important, however, for OKTA to continue showing traction in newer products and AI agent offerings to reinforce the view that these areas can become a more meaningful driver of growth over time.