Okta delivered a solid QQ1 2026 (fiscal 2026) performance underscored by durable cash generation, a robust gross margin, and continued momentum across the governance and Auth0 platforms. Revenue reached $688 million, up approximately 11.5% year over year, with gross margins near 77.5% and EBITDA of $93 million (margin about 13.5%). Operating income was $39 million (about 5.7% margin), while net income was $62 million and GAAP/EPS figures stood at $0.36 (basic) and $0.35 (diluted). Free cash flow was exceptionally strong at $240 million, translating to a roughly 35% FCF margin for the quarter, supported by $241 million of operating cash flow and a cash balance of about $500 million at period end. The balance sheet remains robust with $2.73+ billion in cash and short-term investments, and total stockholders’ equity of $6.57 billion against modest leverage. Management highlighted continued adoption of new governance products (Okta Identity Governance, Lifecycle Management, and Workflows with substantial 400%+ workflow growth over three years to nearly $40 billion in March) and strong Auth0 performance post a record fourth quarter, aided by a realigned go-to-market (GTM) and an ongoing platform specialization strategy.
Guidance for Q2 and FY26 reflects a prudent stance amid a less visible macro backdrop. Management targets 10% revenue growth in Q2 with current RPO growth of 10-11%, and non-GAAP operating margin around 26% and free cash flow margin near 19%. For the full year FY26, the company projects 9-10% revenue growth, ~25% non-GAAP operating margin, and roughly 27% free cash flow margin. While macro uncertainty is acknowledged, Okta maintains its focus on levered profitability, GTM specialization, and accelerating adoption of new products (including Auth for GenAI, Identity Security Posture Management, and Privileged Access) to sustain long-term growth. The quarter also featured meaningful product announcements and industry participation (Showcase) that underscore a broader AI-enabled identity roadmap.
Overall, QQ1 2026 positions Okta to benefit from a broader identity platform strategy, strong enterprise demand, and a growing emphasis on non-human identities (NHIs) and AI-driven workflows, while balancing execution risk in a potentially slower macro environment.