Shares Okta Inc. dropped in late trading after the identity and access management company reported an outlook under analysts’ expectations in its latest earnings report.
For the quarter ended Jan. 31, Okta reported a loss before costs such as stock compensation of $ 29 million, or 18 cents per share. That compares with an adjusted profit of $ 8 million, or six cents per share, a year ago. Revenue jumped 63% from the year-ago quarter, to $ 383 million.
Analysts had expected a loss of 24 cents per share on revenue of $ 360 million.
For Okta’s full fiscal year 2022, the company’s adjusted loss came to $ 68 million, or 46 cents per share, compared to $ 16 million or 11 to 13 cents per share depending on stock dilution, the year prior. Total revenue rose 56% to $ 1.3 billion.
“Identity management is at the forefront of today’s rapidly evolving security environment,” Todd McKinnon, co-founder and chief executive of Okta, said in a statement. “Today, C-level executives and developers are increasingly turning to Okta to help provide their employees and customers with the freedom to safely use any technology.”
At least analysts had expected the switch to a loss, but what they didn’t see coming was the weak outlook.
Looking forward, Okta said it expects an adjusted loss of 34 to 35 cents a share in its fiscal first quarter on revenue of $ 388 million to $ 390 million. For the full fiscal year 2023, Okta expects an adjusted loss of $ 1.24 to $ 1.27 per share on revenue of $ 1.78 billion to $ 1.79 billion. Analysts had expected a full fiscal year profit of 49 cents per share on revenue of $ 1.75 billion.
Although Okta beat revenue expectations, there was a significantly large gap between the loss analysts expected and what Okta is predicting. That gap was noticed by investors, as Okta shares fell more than 6% in late trading.