Okta lifts full-year outlook as Q2 earnings beat on AI agent demand

Subscription backlog rises 17% year over year to $4.86 billion

Okta raised its full-year revenue and earnings guidance after reporting second-quarter results that beat analyst expectations, with CEO Todd McKinnon citing demand for the company’s identity-management offerings tailored to artificial-intelligence agents. The San Francisco-based company now projects full-year revenue of $3.22 billion to $3.23 billion and adjusted earnings of $3.90 to $3.94 a share, up from prior ranges of $3.19 billion to $3.21 billion and $3.79 to $3.87, respectively.

The update arrives as technology companies across the artificial-intelligence infrastructure stack report quarterly results, with investors weighing whether spending on AI tools and capabilities is converting into recurring revenue.

Okta reported second-quarter profit of $116 million, or 65 cents a share, up from $67 million, or 37 cents a share, in the year-earlier period. Adjusted earnings of $1.05 a share exceeded the 97-cent analyst estimate compiled by FactSet. Revenue rose 11% to $805 million, ahead of the $793 million analyst projection. Subscription revenue, which accounts for most of Okta’s top line, grew 12% to $793 million.

For the current third quarter, Okta guided to revenue of $813 million to $817 million and adjusted earnings of 92 cents to 94 cents a share. Analysts polled by FactSet had projected revenue of $808.1 million and adjusted earnings of 94 cents a share.

McKinnon pointed to demand from the company’s largest customers and momentum in core offerings that secure the identities of workers and customer-facing users. He highlighted the company’s new products, including identity governance tools that manage what users can access and for how long, as contributors to growth.

In April, Okta rolled out general availability for an offering specifically tailored for AI agents and has since added capabilities aimed at helping companies discover agents, secure their connections, govern their actions and respond when something goes wrong. “Every agent needs a trusted identity and clear controls over what it can access and do,” McKinnon said.

Okta’s subscription backlog, representing contracted future revenue, stood at $4.86 billion at quarter’s end, up 17% from a year earlier. The company said it expects to recognize $2.59 billion of that backlog over the next 12 months.