- Increases revenue and operating profit outlook for fiscal
2021
- Q3 revenue grew 42% year-over-year; subscription revenue grew
43% year-over-year
- Remaining performance obligations (RPO), or subscription
revenue backlog, grew 53% year-over-year
- Record quarterly operating and free cash flows
- Appoints Board Member Mike Kourey to succeed Bill Losch, who is
retiring, as Chief Financial Officer in March 2021
Okta, Inc. (NASDAQ: OKTA), the leading independent provider of
identity for the enterprise, today announced financial results for
its third quarter ended October 31, 2020.
"We are seeing the importance of a modern identity platform like
the Okta Identity Cloud grow as businesses around the world
accelerate their adoption of cloud-based applications and
re-imagine their digital customer experiences,” said Todd McKinnon,
Chief Executive Officer and co-founder of Okta. “Our strong third
quarter results reflect Okta's leading position in identity and
access management and our continued ability to execute and drive
industry-leading performance.”
Third Quarter Fiscal 2021 Financial Highlights:
- Revenue: Total revenue was $217.4 million, an increase
of 42% year-over-year. Subscription revenue was $206.7 million, an
increase of 43% year-over-year.
- Remaining Performance Obligations (RPO): RPO was $1.58
billion, an increase of 53% year-over-year. Current RPO, which is
contracted subscription revenue expected to be recognized over the
next 12 months, was $753.2 million, up 46% compared to the third
quarter of fiscal 2020.
- Calculated Billings: Total calculated billings were
$252.4 million, an increase of 44% year-over-year.
- GAAP Operating Loss: GAAP operating loss was $52.0
million, or 23.9% of total revenue, compared to $45.7 million, or
29.9% of total revenue, in the third quarter of fiscal 2020.
- Non-GAAP Operating Income/Loss: Non-GAAP operating
income was $5.5 million, or 2.5% of total revenue, compared to a
non-GAAP operating loss of $8.1 million, or 5.3% of total revenue,
in the third quarter of fiscal 2020.
- GAAP Net Loss: GAAP net loss was $72.8 million, compared
to $63.5 million in the third quarter of fiscal 2020. GAAP net loss
per share was $0.56, compared to $0.53 in the third quarter of
fiscal 2020.
- Non-GAAP Net Income/Loss: Non-GAAP net income was $5.7
million, compared to a non-GAAP net loss of $3.8 million in the
third quarter of fiscal 2020. Non-GAAP basic and diluted net income
per share was $0.04, compared to a non-GAAP basic and diluted net
loss per share of $0.03 in the third quarter of fiscal 2020.
- Cash Flow: Net cash provided by operations was $43.4
million, or 20.0% of total revenue, compared to net cash provided
by operations of $10.6 million, or 7.0% of total revenue, in the
third quarter of fiscal 2020. Free cash flow was $41.6 million, or
19.1% of total revenue, compared to $9.2 million, or 6.0% of total
revenue, in the third quarter of fiscal 2020.
- Cash, cash equivalents, and short-term investments were
$2.50 billion at October 31, 2020.
The section titled "Non-GAAP Financial Measures" below contains
a description of the non-GAAP financial measures, and
reconciliations between GAAP and non-GAAP information are contained
in the tables below.
Financial Outlook:
"We are pleased with our strong third quarter performance," said
Bill Losch, Chief Financial Officer of Okta. "Our strong growth in
RPO and revenue, and record cash flows, are evidence of our success
with large enterprise customers and the continued secular tailwinds
driving our business. We are confident in our ability to continue
executing at a high level and thus are raising our fiscal year 2021
outlook for both revenue and profitability."
For the fourth quarter of fiscal 2021, the Company expects:
- Total revenue of $221 million to $222 million, representing a
growth rate of 32% to 33% year-over-year
- Non-GAAP operating loss of $2.0 million to $1.0 million
- Non-GAAP net loss per share of $0.02 to $0.01, assuming
weighted shares outstanding of approximately 131 million
For the full year fiscal 2021, the Company now expects:
- Total revenue of $822 million to $823 million, representing a
growth rate of 40% year-over-year
- Non-GAAP operating loss of $2.3 million to $1.3 million
- Non-GAAP net income per share, diluted of $0.04 to $0.05,
assuming weighted shares outstanding of approximately 143
million
These statements are forward-looking and actual results may
differ materially. Refer to the Forward-Looking Statements safe
harbor below for information on the factors that could cause our
actual results to differ materially from these forward-looking
statements.
Okta has not reconciled its expectations as to non-GAAP
operating loss and non-GAAP net income (loss) per share, diluted to
its most directly comparable GAAP measure because certain items are
out of Okta’s control or cannot be reasonably predicted.
Accordingly, a reconciliation for forward-looking non-GAAP
operating loss and non-GAAP net income (loss) per share, diluted is
not available without unreasonable effort.
Chief Financial Officer Transition:
Current Okta Board member and audit committee chair, Mike
Kourey, will join Okta as Chief Financial Officer in March 2021.
Kourey will succeed Bill Losch, who will be retiring after serving
as CFO at Okta since 2013. Losch will continue in his current role
through early March 2021 and the filing of Okta’s Form 10-K, and
will remain an advisor to Okta through the end of the company’s
first quarter of fiscal 2022. Kourey will report directly to Todd
McKinnon, Okta’s Chief Executive Officer and co-founder, step down
from the Audit Committee in connection with this transition, and
will resign from Okta’s board when he assumes the CFO role.
“I want to thank Bill for his invaluable contribution to Okta
from our early years to helping set the course to achieve over $1
billion in revenue next year,” said McKinnon. “He’s been a
fantastic leader, partner, and friend, and we are all going to
sincerely miss him. We’re excited for the next chapter for Bill and
wish him nothing but the best in his retirement next year.
“We couldn’t ask for a better successor than Mike, who has been
an instrumental member of our board as audit committee chair over
the past five years,” continued McKinnon. “Mike’s career in
technology, both as an executive leader and board member, is second
to none. He brings decades of experience in scaling companies,
which will be key as we position Okta to become the next iconic
technology company.”
Kourey joined Okta’s board as audit committee chair in 2015.
Since early 2019, Kourey has served as the Chief Financial Officer
of Vlocity Inc., a cloud software company that was acquired by
Salesforce in June 2020. From 2015 to 2018, Kourey served as the
Chief Financial Officer of Medallia, Inc., a cloud-based customer
experience management company. Prior to Medallia, he served as a
Partner at Khosla Ventures, a venture capital firm. Kourey also
spent over 20 years in a variety of roles at Polycom, Inc., a
communications solutions company, most recently as Chief Financial
Officer. He previously served on the boards of RingCentral, Inc.,
Aruba Networks, Inc., Riverbed Technology, Inc. and other public
and private companies. Kourey holds a Masters of Business
Administration from Santa Clara University and a Bachelor of
Science from University of California, Davis.
Conference Call Information:
Okta will host a live video webcast at 2:00 p.m. Pacific Time on
December 2, 2020 to discuss the results and outlook. The news
release with the financial results will be accessible from the
Company’s website at investor.okta.com prior to the conference
call. The live video webcast of the conference call will be
accessible from the Okta investor relations website at
investor.okta.com.
Supplemental Financial and Other Information:
Supplemental financial and other information can be accessed
through the Company’s investor relations website at
investor.okta.com.
Non-GAAP Financial Measures:
This press release and the accompanying tables contain the
following non-GAAP financial measures: non-GAAP gross profit,
non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP
operating margin, non-GAAP net income (loss), non-GAAP net margin,
non-GAAP net income (loss) per share, basic and diluted, free cash
flow, free cash flow margin, current calculated billings and
calculated billings. Certain of these non-GAAP financial measures
exclude stock-based compensation, amortization of debt discount and
debt issuance costs, non-cash charitable contributions,
amortization of acquired intangibles, acquisition-related expenses
and loss on early extinguishment and conversion of debt.
Okta believes that non-GAAP financial information, when taken
collectively with GAAP financial measures, may be helpful to
investors because it provides consistency and comparability with
past financial performance and assists in comparisons with other
companies, some of which use similar non-GAAP financial information
to supplement their GAAP results. The non-GAAP financial
information is presented for supplemental informational purposes
only, and should not be considered a substitute for financial
information presented in accordance with GAAP, and may be different
from similarly-titled non-GAAP measures used by other
companies.
The principal limitation of these non-GAAP financial measures is
that they exclude significant expenses that are required by GAAP to
be recorded in the Company’s financial statements. In addition,
they are subject to inherent limitations as they reflect the
exercise of judgment by the Company's management about which
expenses are excluded or included in determining these non-GAAP
financial measures. A reconciliation is provided below for each
non-GAAP financial measure to the most directly comparable
financial measure stated in accordance with GAAP.
Okta encourages investors to review the related GAAP financial
measures and the reconciliation of these non-GAAP financial
measures to their most directly comparable GAAP financial measures,
which it includes in press releases announcing quarterly financial
results, including this press release, and not to rely on any
single financial measure to evaluate the Company’s business.
Forward-Looking Statements: This press release contains
"forward-looking statements" within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act
of 1995, including but not limited to, statements regarding our
financial outlook, business strategy and plans, market trends and
market size, opportunities and positioning. These forward-looking
statements are based on current expectations, estimates, forecasts
and projections. Words such as "expect," "anticipate," "should,"
"believe," "hope," "target," "project," "goals," "estimate,"
"potential," "predict," "may," "will," "might," "could," "intend,"
"shall" and variations of these terms and similar expressions are
intended to identify these forward-looking statements, although not
all forward-looking statements contain these identifying words.
Forward-looking statements are subject to a number of risks and
uncertainties, many of which involve factors or circumstances that
are beyond our control. For example, the market for our products
may develop more slowly than expected or than it has in the past;
our results of operations may fluctuate more than expected; there
may be significant fluctuations in our results of operations and
cash flows related to our revenue recognition or otherwise; the
impact of COVID-19, related public health measures and any
associated economic downturn on our business and results of
operations may be more than we expect; a network or data security
incident that allows unauthorized access to our network or data or
our customers’ data could damage our reputation; we could
experience interruptions or performance problems associated with
our technology, including a service outage; we may not be able to
pay off our convertible senior notes when due; and global economic
conditions could deteriorate. Further information on potential
factors that could affect our financial results is included in our
most recent Quarterly Report on Form 10-Q and our other filings
with the Securities and Exchange Commission. The forward-looking
statements included in this press release represent our views only
as of the date of this press release and we assume no obligation
and do not intend to update these forward-looking statements.
About Okta
Okta is the leading independent provider of identity for the
enterprise. The Okta Identity Cloud enables organizations to
securely connect the right people to the right technologies at the
right time. With over 6,500 pre-built integrations to applications
and infrastructure providers, Okta customers can easily and
securely use the best technologies for their business. Over 9,400
organizations, including Engie, JetBlue, Nordstrom, Takeda
Pharmaceutical, Teach for America, T-Mobile and Twilio, trust Okta
to help protect the identities of their workforces and
customers.
Okta uses its investor.okta.com website as a means of disclosing
material non-public information, announcing upcoming investor
conferences and for complying with its disclosure obligations under
Regulation FD. Accordingly, you should monitor our investor
relations website in addition to following our press releases, SEC
filings and public conference calls and webcasts.
OKTA, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except per share
data)
(unaudited)
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019
2020
2019
Revenue:
Subscription
$
206,743
$
144,517
$
571,213
$
394,174
Professional services and other
10,636
8,520
29,471
24,566
Total revenue
217,379
153,037
600,684
418,740
Cost of revenue:
Subscription(1)
44,762
30,124
121,420
82,581
Professional services and other(1)
12,146
10,700
35,121
32,118
Total cost of revenue
56,908
40,824
156,541
114,699
Gross profit
160,471
112,213
444,143
304,041
Operating expenses:
Research and development(1)
58,150
41,832
160,510
115,909
Sales and marketing(1)
109,812
87,224
312,177
247,721
General and administrative(1)
44,485
28,887
121,019
81,540
Total operating expenses
212,447
157,943
593,706
445,170
Operating loss
(51,976
)
(45,730
)
(149,563
)
(141,129
)
Interest expense
(22,368
)
(7,826
)
(50,063
)
(16,371
)
Interest income and other, net
1,878
4,982
10,737
11,346
Loss on early extinguishment and
conversion of debt
(89
)
(14,572
)
(2,263
)
(14,572
)
Interest and other, net
(20,579
)
(17,416
)
(41,589
)
(19,597
)
Loss before provision for (benefit from)
income taxes
(72,555
)
(63,146
)
(191,152
)
(160,726
)
Provision for (benefit from) income
taxes
209
349
(626
)
(2,285
)
Net loss
$
(72,764
)
$
(63,495
)
$
(190,526
)
$
(158,441
)
Net loss per share, basic and diluted
$
(0.56
)
$
(0.53
)
$
(1.51
)
$
(1.37
)
Weighted-average shares used to compute
net loss
per share, basic and diluted
128,813
118,976
126,222
115,598
(1)
Amounts include stock-based
compensation expense as follows (in thousands):
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019
2020
2019
Cost of subscription revenue
$
6,090
$
3,604
$
15,229
$
9,137
Cost of professional services and
other
2,113
1,900
5,924
5,292
Research and development
17,546
10,894
44,434
26,322
Sales and marketing
14,368
10,937
38,693
26,959
General and administrative
13,535
8,400
35,494
21,984
Total stock-based compensation expense
$
53,652
$
35,735
$
139,774
$
89,694
OKTA, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands)
(unaudited)
October 31,
January 31,
2020
2020
Assets
Current assets:
Cash and cash equivalents
$
409,769
$
520,048
Short-term investments
2,085,373
882,976
Accounts receivable, net of allowances
139,473
130,115
Deferred commissions
40,908
33,636
Prepaid expenses and other current
assets
82,016
32,950
Total current assets
2,757,539
1,599,725
Property and equipment, net
62,405
53,535
Operating lease right-of-use assets
154,699
125,204
Deferred commissions, noncurrent
94,305
77,874
Intangible assets, net
28,953
32,529
Goodwill
48,023
48,023
Other assets
24,355
18,505
Total assets
$
3,170,279
$
1,955,395
Liabilities and stockholders'
equity
Current liabilities:
Accounts payable
$
5,114
$
3,837
Accrued expenses and other current
liabilities
47,330
36,887
Accrued compensation
61,600
40,300
Convertible senior notes, net
35,131
100,703
Deferred revenue
424,765
365,236
Total current liabilities
573,940
546,963
Convertible senior notes, net,
noncurrent
1,709,777
837,002
Operating lease liabilities,
noncurrent
185,860
154,511
Deferred revenue, noncurrent
7,349
6,214
Other liabilities, noncurrent
12,705
5,361
Total liabilities
2,489,631
1,550,051
Stockholders’ equity:
Preferred stock
—
—
Class A common stock
12
11
Class B common stock
1
1
Additional paid-in capital
1,569,714
1,105,564
Accumulated other comprehensive income
2,571
892
Accumulated deficit
(891,650
)
(701,124
)
Total stockholders’ equity
680,648
405,344
Total liabilities and stockholders'
equity
$
3,170,279
$
1,955,395
OKTA, INC.
SUMMARY OF CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
Nine Months Ended
October 31,
2020
2019
Cash flows from operating
activities:
Net loss
$
(190,526
)
$
(158,441
)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Stock-based compensation
139,774
89,691
Depreciation, amortization and
accretion
23,694
12,336
Amortization of debt discount and issuance
costs
47,261
15,653
Amortization of deferred commissions
28,428
20,541
Deferred income taxes
(2,414
)
(3,069
)
Non-cash charitable contributions
4,662
1,162
Loss on early extinguishment and
conversion of debt
2,263
14,572
Other, net
4,515
84
Changes in operating assets and
liabilities:
Accounts receivable
(10,547
)
(9,393
)
Deferred commissions
(51,837
)
(36,641
)
Prepaid expenses and other assets
(6,794
)
(1,518
)
Operating lease right-of-use assets
13,979
7,851
Accounts payable
1,377
1,962
Accrued compensation
37,863
17,352
Accrued expenses and other liabilities
2,442
4,017
Operating lease liabilities
(11,750
)
(4,128
)
Deferred revenue
60,663
58,737
Net cash provided by operating
activities
93,053
30,768
Cash flows from investing
activities:
Capitalization of internal-use software
costs
(3,530
)
(2,659
)
Purchases of property and equipment
(11,297
)
(9,980
)
Purchases of securities available for sale
and other
(1,845,958
)
(321,462
)
Proceeds from maturities and redemption of
securities available for sale
386,774
244,393
Proceeds from sales of securities
available for sale and other
206,129
17,329
Purchases of intangible assets
—
(8,500
)
Payments for business acquisition, net of
cash acquired
—
(44,223
)
Net cash used in investing activities
(1,267,882
)
(125,102
)
Cash flows from financing
activities:
Proceeds from issuance of convertible
senior notes, net of issuance costs
1,134,841
1,040,760
Payments for repurchases of convertible
senior notes
(447
)
(224,414
)
Proceeds from hedges related to
convertible senior notes
195,046
405,851
Payments for warrants related to
convertible senior notes
(175,399
)
(358,622
)
Purchases of capped calls related to
convertible senior notes
(133,975
)
(74,094
)
Proceeds from stock option exercises
33,570
36,371
Proceeds from shares issued in connection
with employee stock purchase plan
12,821
9,005
Other, net
—
(126
)
Net cash provided by financing
activities
1,066,457
834,731
Effects of changes in foreign currency
exchange rates on cash, cash equivalents and restricted cash
121
(241
)
Net increase (decrease) in cash, cash
equivalents and restricted cash
(108,251
)
740,156
Cash, cash equivalents and restricted cash
at beginning of period
531,953
311,215
Cash, cash equivalents and restricted
cash at end of period
$
423,702
$
1,051,371
OKTA, INC. Reconciliation of GAAP to
Non-GAAP Data (In thousands, except percentages and per share
data) (unaudited)
Non-GAAP Gross Profit and Non-GAAP Gross Margin
We define non-GAAP gross profit and non-GAAP gross margin as
GAAP gross profit and GAAP gross margin, adjusted for stock-based
compensation expense and amortization of acquired intangibles.
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019
2020
2019
Gross profit
$
160,471
$
112,213
$
444,143
$
304,041
Add:
Stock-based compensation expense included
in cost of revenue(1)
8,203
5,504
21,153
14,429
Amortization of acquired intangibles
1,593
1,347
4,780
3,895
Non-GAAP gross profit
$
170,267
$
119,064
$
470,076
$
322,365
Gross margin
74
%
73
%
74
%
73
%
Non-GAAP gross margin
78
%
78
%
78
%
77
%
(1)
See table in footnote (1) to the
condensed consolidated statements of operations above for breakdown
of stock-based compensation expense by line item.
Non-GAAP Operating Income (Loss) and Non-GAAP Operating
Margin
We define non-GAAP operating income (loss) and non-GAAP
operating margin as GAAP operating loss and GAAP operating margin,
adjusted for stock-based compensation expense, non-cash charitable
contributions, amortization of acquired intangibles and
acquisition-related expenses.
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019
2020
2019
Operating loss
$
(51,976
)
$
(45,730
)
$
(149,563
)
$
(141,129
)
Add:
Stock-based compensation expense(1)
53,652
35,735
139,774
89,694
Non-cash charitable contributions
2,245
510
4,662
1,162
Amortization of acquired intangibles
1,593
1,347
4,780
3,895
Acquisition-related expenses(2)
—
—
—
3,449
Non-GAAP operating income (loss)
$
5,514
$
(8,138
)
$
(347
)
$
(42,929
)
Operating margin
(24
)
%
(30
)
%
(25
)
%
(34
)
%
Non-GAAP operating margin
3
%
(5
)
%
—
%
(10
)
%
(1)
See table in footnote (1) to the
condensed consolidated statements of operations above for breakdown
of stock-based compensation expense by line item.
(2)
We define acquisition-related
expenses as costs associated with acquisitions, including
transaction costs and other non-recurring incremental costs
incurred.
Non-GAAP Net Income (Loss) and Non-GAAP Net Margin
We define non-GAAP net income (loss) and non-GAAP net margin as
GAAP net loss and GAAP net margin, adjusted for stock-based
compensation expense, non-cash charitable contributions,
amortization of acquired intangibles, acquisition-related expenses,
amortization of debt discount and debt issuance costs and loss on
early extinguishment and conversion of debt.
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019(1)
2020
2019(1)
Net loss
$
(72,764)
$
(63,495)
$
(190,526)
$
(158,441)
Add:
Stock-based compensation expense(2)
53,652
35,735
139,774
89,694
Non-cash charitable contributions
2,245
510
4,662
1,162
Amortization of acquired intangibles
1,593
1,347
4,780
3,895
Acquisition-related expenses(3)
—
—
—
3,449
Amortization of debt discount and debt
issuance costs(4)
20,931
7,540
47,261
15,653
Loss on early extinguishment and
conversion of debt(5)
89
14,572
2,263
14,572
Non-GAAP net income (loss)
$
5,746
$
(3,791)
$
8,214
$
(30,016)
Net margin
(33)
%
(41)
%
(32)
%
(38)
%
Non-GAAP net margin
3
%
(2)
%
1
%
(7)
%
(1)
Prior periods have been adjusted
to conform to the current presentation. See footnotes (4) and (5)
for additional details.
(2)
See table in footnote (1) to the
condensed consolidated statements of operations above for breakdown
of stock-based compensation expense by line item.
(3)
We define acquisition-related
expenses as costs associated with acquisitions, including
transaction costs and other non-recurring incremental costs
incurred.
(4)
Amortization of debt issuance
costs is an adjustment to non-GAAP net income (loss), effective
July 31, 2020. Debt issuance costs included are $0.9 million and
$2.3 million for the three and nine months ended October 31, 2020,
respectively, and $0.5 million and $1.1 million for the three and
nine months ended October 31, 2019, respectively.
(5)
Loss on early extinguishment and
conversion of debt is calculated inclusive of write-offs of debt
issuance costs, effective July 31, 2020. The amounts of these
write-offs are $0.1 million and $1.1 million for the three and nine
months ended October 31, 2020, respectively, and $3.8 million for
the three and nine months ended October 31, 2019, respectively.
Non-GAAP Net Income (Loss) per share, basic and
diluted
We define non-GAAP net income (loss) per share, basic, as
non-GAAP net income (loss) divided by GAAP weighted-average shares
used to compute net loss per share, basic and diluted.
We define non-GAAP net income (loss) per share, diluted, as
non-GAAP net income (loss) divided by GAAP weighted-average shares
used to compute net loss per share, basic and diluted adjusted for
the potentially dilutive effect of (i) employee equity incentive
plans, excluding the impact of unrecognized stock-based
compensation expense, and (ii) convertible senior notes outstanding
and related warrants. In addition, non-GAAP net income (loss) per
share, diluted, includes the anti-dilutive impact of the Company’s
note hedge and capped call agreements on convertible senior notes
outstanding, which fully reduced the potential dilutive effect of
the convertible senior notes outstanding. Accordingly, the Company
did not record any adjustments to non-GAAP net income (loss) for
the potential impact of the convertible senior notes outstanding
under the if-converted method.
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019(1)
2020
2019(1)
Net loss
$
(72,764
)
$
(63,495
)
$
(190,526
)
$
(158,441
)
Add:
Stock-based compensation expense(2)
53,652
35,735
139,774
89,694
Non-cash charitable contributions
2,245
510
4,662
1,162
Amortization of acquired intangibles
1,593
1,347
4,780
3,895
Acquisition-related expenses(3)
—
—
—
3,449
Amortization of debt discount and debt
issuance costs(4)
20,931
7,540
47,261
15,653
Loss on early extinguishment and
conversion of debt(5)
89
14,572
2,263
14,572
Non-GAAP net income (loss)
$
5,746
$
(3,791
)
$
8,214
$
(30,016
)
Weighted-average shares used to compute
net loss per share, basic and diluted
128,813
118,976
126,222
115,598
Non-GAAP weighted-average effect of
potentially dilutive securities
14,579
—
15,714
—
Non-GAAP weighted-average shares used to
compute non-GAAP net income (loss) per share, diluted
143,392
118,976
141,936
115,598
Net loss per share, basic and diluted
$
(0.56
)
$
(0.53
)
$
(1.51
)
$
(1.37
)
Non-GAAP net income (loss) per share,
basic(6)
$
0.04
$
(0.03
)
$
0.07
$
(0.26
)
Non-GAAP net income (loss) per share,
diluted(6)
$
0.04
$
(0.03
)
$
0.06
$
(0.26
)
(1)
Prior periods have been adjusted
to conform to the current presentation. See footnotes (4), (5) and
(6) for additional details.
(2)
See table in footnote (1) to the
condensed consolidated statements of operations above for breakdown
of stock-based compensation expense by line item.
(3)
We define acquisition-related
expenses as costs associated with acquisitions, including
transaction costs and other non-recurring incremental costs
incurred.
(4)
Amortization of debt issuance
costs is an adjustment to non-GAAP net income (loss), effective
July 31, 2020. Debt issuance costs included are $0.9 million and
$2.3 million for the three and nine months ended October 31, 2020,
respectively, and $0.5 million and $1.1 million for the three and
nine months ended October 31, 2019, respectively.
(5)
Loss on early extinguishment and
conversion of debt is calculated inclusive of write-offs of debt
issuance costs, effective the three July 31, 2020. The amounts of
these write-offs are $0.1 million and $1.1 million for the three
and nine months ended October 31, 2020, respectively, and $3.8
million for the three and nine months ended October 31, 2019,
respectively.
(6)
The total impact of the
adjustments noted in footnotes (4) and (5) and for the periods
noted in footnote (1) above on non-GAAP net income (loss) per
share, basic and diluted is $0.04 and $0.04 for the three and nine
months ended October 31, 2019, respectively.
OKTA, INC. Reconciliation of GAAP to
Non-GAAP Financial Measures (In thousands, except percentages)
(unaudited)
Free Cash Flow and Free Cash Flow Margin
We define Free Cash Flow as net cash provided by operating
activities, less cash used for purchases of property and equipment
and capitalized internal-use software costs. Free cash flow margin
is calculated as free cash flow divided by total revenue.
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019
2020
2019
Net cash provided by operating
activities
$
43,426
$
10,640
$
93,053
$
30,768
Less:
Purchases of property and equipment
(628
)
(63
)
(11,297
)
(9,980
)
Capitalization of internal-use software
costs
(1,204
)
(1,329
)
(3,530
)
(2,659
)
Free cash flow
$
41,594
$
9,248
$
78,226
$
18,129
Net cash used in investing activities
$
(595,621
)
$
22,888
$
(1,267,882
)
$
(125,102
)
Net cash provided by financing
activities
$
5,210
$
798,399
$
1,066,457
$
834,731
Free cash flow margin
19
%
6
%
13
%
4
%
Calculated Billings
We define Calculated Billings as total revenue plus the change
in deferred revenue and less the change in unbilled receivables
during the period.
Three Months Ended
October 31,
Nine Months Ended
October 31,
2020
2019
2020
2019
Total revenue
$
217,379
$
153,037
$
600,684
$
418,740
Add:
Unbilled receivables, current (beginning
of period)
2,113
1,004
1,026
1,457
Deferred revenue, current (end of
period)
424,765
306,743
424,765
306,743
Less:
Unbilled receivables, current (end of
period)
(2,427
)
(1,028
)
(2,427
)
(1,028
)
Deferred revenue, current (beginning of
period)
(391,246
)
(283,724
)
(365,236
)
(245,622
)
Current calculated billings
250,584
176,032
658,812
480,290
Add:
Deferred revenue, noncurrent (end of
period)
7,349
7,013
7,349
7,013
Less:
Deferred revenue, noncurrent (beginning of
period)
(5,574
)
(7,469
)
(6,214
)
(8,768
)
Calculated billings
$
252,359
$
175,576
$
659,947
$
478,535
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201202005306/en/
Investor Contact: Dave Gennarelli investor@okta.com
415-851-4744 Media Contact: Jenna Kozel press@okta.com
415-418-9600
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