Okta Slips After CEO Strikes Cautious Tone About Rest of Year
(Bloomberg) -- Okta Inc. shares slipped after Chief Executive Officer Todd McKinnon said the company is being cautious in the midst of an economic downturn and lingering global pandemic.
“We’re still being prudent about the rest of the year and the macroeconomic consequences ahead of us,” he said in an interview. “Headwinds to the business will be a little stronger in the second half.”
The CEO noted that 11% of Okta’s customers have been negatively affected by Covid-19. Large enterprises have shown more demand than small and mid-sized companies, he added.
Otka shares dropped about 5% in extended after closing at $218.44 in New York. The stock has climbed 89% this year.
McKinnon has pursued partnerships to make Okta’s security software useful for workers who need to access corporate systems, students who must use remote-learning apps and consumers who are required to authenticate their identity online.
The company raised its annual sales forecast on Thursday, a sign of robust demand. Still, the company’s revenue expectation for the current period that ends in late October represents sales growth of 32% to 33%, down from the 43% year-over-year gain in previous quarter.
Okta narrowed its loss forecast for the fiscal year to 1 cent to 3 cents a share. Analysts were looking for a loss of 20 cents a share.
In the period that ends in late October, the company forecast a loss, excluding some items, of 1 cents to 2 cents per share, better than analysts’ expectation of a loss of 6 cents a share.
Okta’s revenue jumped 43% to $200 million in the period that ended July 31, beating analysts’ projections. Excluding some items, the company reported income of $9.9 million, or 7 cents a share. Analysts had predicted a small loss.
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