01—Abstract
Summary
Summary of the 10-K filed March 5, 2025. Cited figures are marked; the original filing is the authoritative source.
Okta, Inc. is the leading independent identity partner, offering the Okta Platform for workforce identity and the Auth0 Platform for customer identity.
As of January 31, 2025, it had more than 19,650 customers, including more than 4,800 with annual contract value above $100,000,a and over 7,000 integrations. Subscriptions made up approximately 98% of total revenue in fiscal 2025. Total revenue was $2,610 million, up from $2,263 million in fiscal 2024, and the company reported net income of $28 million, compared with net losses of $355 million in fiscal 2024 and $815 million in fiscal 2023.
Gross margin improved to 76% from 74%, and operating loss narrowed to $74 millionb from $516 million. Key balance sheet and cash items include cash, cash equivalents and short-term investments of $2,523 million, deferred revenue of $1,718 million, and convertible senior notes with $510 million principal due September 2025 and $350 million due June 2026. Operating cash flow was $750 million in fiscal 2025, up from $512 million.
The Dollar-Based Net Retention Rate declined to 107% from 111%, which the filing attributes primarily to the macroeconomic environment. Remaining performance obligations rose to $4,215 millionc from $3,385 million.
The filing also highlights risks including a dual-class structure in which directors, executive officers and affiliates held 35.3% of voting power, the ongoing competitive threat from Microsoft as principal competitor, cybersecurity incidents in January 2022 and October 2023, and the settlement of the securities class action for $60 milliond covered by insurance and retention. Several derivative lawsuits were subject to a non-monetary settlement agreed in principle in January 2025.
02—Key points
Key Highlights
- Revenue grew to $2,610 million in fiscal 2025 from $2,263 million, and the company reported net income of $28 million after net losses of $355 million in fiscal 2024 and $815 million in fiscal 2023.
- Operating loss narrowed to $74 million from $516 million, with gross margin rising to 76% from 74% and total operating expenses falling to $2,066 million from $2,198 million.
- Operating cash flow reached $750 million, up from $512 million, while cash, cash equivalents and short-term investments totaled $2,523 million.
- Dollar-Based Net Retention Rate fell to 107% from 111%, which the company attributes primarily to the macroeconomic environment.
- Customer count reached more than 19,650, with more than 4,800 customers above $100,000 in annual contract value, up from 4,485 a year earlier.
- Remaining performance obligations increased to $4,215 million from $3,385 million, with $2,248 million expected to be recognized over the next 12 months.
- Convertible notes remain outstanding at $510 million (due September 2025) and $350 million (due June 2026), and the company intends to settle the 2025 Notes principal in cash.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2025, Okta kept $0.01.
- Revenue$2.61B100.0%
- Cost of revenue−$618.0M23.7%
- Gross profit$1.99B76.3%
- Operating costs−$2.07B79.2%
- Operating income−$74.0M2.8%
- Interest, other & tax$102.0M3.9%
- Net income$28.0M1.1%
04—Financials
Financial Highlights
Figures from 10-KFY2025filed March 5, 2025Financial Statements
FY2025 against FY2024
| Line item | FY2025FY2024 | Change |
|---|---|---|
| Revenue | $2.61B$2.26B | +15.3% |
| Cost of Revenue | $618.00M$581.00M | +6.4% |
| Gross Profit | $1.99B$1.68B | +18.4% |
| R&D Expenses | $642.00M$656.00M | −2.1% |
| Operating Expenses | $2.07B$2.20B | −6.0% |
| Operating Income | -$74.00M-$516.00M | +85.7% |
| Net Income | $28.00M-$355.00M | +107.9% |
| EPS (Basic) | $0.16$-2.17 | +107.4% |
| EPS (Diluted) | $0.06$-2.17 | +102.8% |
| Shares Outstanding (Basic) | 169.57M163.63M | +3.6% |
| Shares Outstanding (Diluted) | 175.09M163.63M | +7.0% |
05—Questions
Frequently Asked Questions
Is Okta now profitable, and what drove the improvement?
Okta reported net income of $28 million for fiscal 2025, compared with net losses of $355 million in fiscal 2024. The filing attributes the improvement to revenue growth of 15% alongside lower operating expenses, including reductions in sales and marketing, research and development, and general and administrative expenses, which the company describes as driven by improved spend efficiency.
How concentrated is voting control at Okta?
Holders of Class B common stock, which carries ten votes per share, held 35.3% of the voting power as of January 31, 2025, through directors, executive officers and their affiliates. The filing states this concentration could persist until April 12, 2027, limiting outside stockholders' ability to influence corporate matters.
What are the main risks tied to Okta's convertible notes?
The 2025 Notes ($510 million principal) mature September 1, 2025, and the 2026 Notes ($350 million principal) mature June 15, 2026. The company states it intends to settle the 2025 Notes principal in cash. Repurchases, conversions or hedging activity by holders and capped call counterparties could affect the stock price and create dilution.
What cybersecurity incidents has Okta disclosed?
The filing discloses a January 2022 compromise of a third-party service provider and an October 2023 incident in which a threat actor accessed and stole information from the company's customer support system hosted by a third-party provider. The filing states that to date no prior incidents have materially affected the company, though it expects the incidents to adversely affect future financial performance.
What is the status of the securities class action?
The securities class action lawsuit was settled for $60 million, covered through the company's D&O insurance and the balance of its $10 million retention on the primary D&O policy. The court granted final approval on November 19, 2024, and dismissed the lawsuit with prejudice. Related derivative lawsuits were subject to an agreement in principle on non-monetary terms in January 2025.
06—Continue