Okta recently released its latest 10-Q report. The company describes itself as an identity provider with two main platforms, Okta and Auth0, used to control access for human users, non-human identities and, in early-stage products, AI agents. As of April 30, 2026, Okta said its integration network included more than 7,000 connections with cloud, mobile, web, IT infrastructure and security vendors.
For the three months ended April 30, 2026, total revenue rose 11% to $765 million from $688 million a year earlier. Subscription revenue increased 11% to $750 million, while professional services and other revenue was flat at $15 million. Subscription revenue accounted for 98% of total revenue in both periods.
Gross profit increased to $595 million from $533 million, and gross margin improved to 78% from 77%. Subscription gross margin held at 80%, while professional services and other gross margin fell to negative 33% from negative 27%.
Total operating expenses rose 9% to $539 million from $494 million. Sales and marketing climbed to $278 million from $237 million, research and development increased to $163 million from $154 million, and general and administrative declined to $98 million from $103 million.
Operating income increased to $56 million from $39 million. Interest and other, net fell to $22 million from $29 million, and income before taxes rose to $78 million from $68 million. Provision for income taxes was $4 million, down from $6 million.
Net income increased to $74 million from $62 million. On a percentage basis, net income was 10% of revenue, compared with 9% a year earlier.
Okta said the subscription revenue increase was driven by more users, sales of additional solutions to existing customers and new customer additions. It also said its 107% dollar-based net retention rate as of April 30, 2026 reflected higher revenue from existing customers. Professional services and other revenue was unchanged, and the company said it expects that line to decline as more work shifts to its partner ecosystem.
Cost of subscription revenue rose 9% to $150 million, mainly because hosting fees increased by $8 million and labor costs by $3 million. Cost of professional services and other revenue increased to $20 million from $19 million, driven by higher labor costs.
Stock-based compensation expense totaled $117 million, down from $128 million. By function, that included $41 million in research and development, $29 million in sales and marketing, $29 million in general and administrative, $16 million in cost of subscription revenue and $2 million in cost of professional services and other revenue. As a result of these announcements, the company's shares have moved 22.56% on the market, and are now trading at a price of $116.09. For the full picture, make sure to review Okta's 10-Q report.
