Okta (OKTA) Q2 Earnings Report Preview: What To Look For

Identity management company Okta (NASDAQ:OKTA) will be reporting earnings this Wednesday afternoon. Here’s what investors should know.

Okta beat analysts’ revenue expectations last quarter, reporting revenues of $765 million, up 11.2% year on year. It was a strong quarter for the company, with an impressive beat of analysts’ adjusted operating income estimates and a solid beat of analysts’ billings estimates.

Is Okta a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, the market is expecting Okta’s revenue to grow 8.9% year on year, slowing from the 12.7% increase it recorded in the same quarter last year.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Okta has a history of exceeding Wall Street’s expectations.

Looking at Okta’s peers in the cybersecurity segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Qualys delivered year-on-year revenue growth of 11%, beating analysts’ expectations by 2%, and Varonis Systems reported revenues up 18.3%, topping estimates by 1.8%. Qualys traded up 13.8% following the results while Varonis Systems was down 9%.

Read our full analysis of Qualys’s results here and Varonis Systems’s results here.

There has been positive sentiment among investors in the cybersecurity segment, with share prices up 15.7% on average over the last month. Okta is down 4.8% during the same time and is heading into earnings with an average analyst price target of $146.34 (compared to the current share price of $130.78).

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