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OKTA Gears Up to Report Q3 Earnings: What's in the Cards?

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Okta, Inc. (OKTA - Free Report) is set to report its third-quarter fiscal 2023 results on Nov 30.

For the fiscal third quarter, Okta anticipates a non-GAAP net loss in the range of 25-24 cents per share. The Zacks Consensus Estimate for loss has remained steady at 24 cents per share over the past 30 days.

Revenues are expected in the range of $463-$465 million, indicating growth between 32% and 33% from the year-ago period’s reported figure. The Zacks Consensus Estimate for revenues is pegged at $463.62 million, indicating an increase of 32.21% from the year-ago quarter’s reported figure.

Okta’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average earnings surprise being 45.46%.
 

Okta, Inc. Price and EPS Surprise

Okta, Inc. Price and EPS Surprise

Okta, Inc. price-eps-surprise | Okta, Inc. Quote

Let’s see how things have shaped up for Okta prior to this announcement:

Factors to Consider

The company’s third-quarter fiscal 2023 results are expected to reflect the benefits of increased use cases of identity solutions.

Okta Identity Cloud’s capability to consolidate and easily integrate existing applications without compromising security or stability is attracting customers. Okta products’ ability to automate processes, secure data and reduce costs is also a positive.

Adoption of Okta’s Auth0 solution is expected to have remained strong in the to-be-reported quarter.

Demand for the company’s solutions has remained strong due to digital transformation projects and the adoption of Zero Trust security. The momentum is expected to have continued in the to-be-reported quarter.

These factors are expected to have expanded the customer base in the fiscal third quarter. In the fiscal second quarter, Okta added 600 new customers, bringing the total customer count to 16,400, up 26% year over year. Customers with more than $100K in Annual Contract Value increased 35% year over year.

However, Okta is expected to have faced challenges in sales integration as well as heightened attrition. These factors are expected to have hurt Okta’s fiscal third-quarter prospects.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here.

Okta has an Earnings ESP of +0.71% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are a few other companies worth considering, as our model shows that these too have the right combination of elements to beat on earnings in their upcoming releases:

GIII Apparel Group (GIII - Free Report) has an Earnings ESP of +0.68% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

GIII Apparel is likely to release its fourth-quarter fiscal 2023 results on Dec 7. GIII shares have been down 22.2% year to date compared with the Zacks Computer & Technology sector’s decline of 31.2%.

AutoZone (AZO - Free Report) has an Earnings ESP of +2.91% and a Zacks Rank #3. AZO is scheduled to release its first-quarter fiscal 2023 results on Dec 6.

AutoZone shares are up 20% year to date, outperforming the Zacks Computer & Technology sector.

Adobe (ADBE - Free Report) has an Earnings ESP of +0.03% and a Zacks Rank #3. It is likely to release its fourth-quarter fiscal 2022 results on Dec 15.

ADBE shares have been down 40.8% year to date, underperforming the Zacks Computer & Technology sector.


Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Adobe Inc. (ADBE) - free report >>

AutoZone, Inc. (AZO) - free report >>

G-III Apparel Group, LTD. (GIII) - free report >>

Okta, Inc. (OKTA) - free report >>

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