Total Revenue

11.5% increase (from $617 million in Q1 FY25 to $688 million in Q1 FY26)

Revenue growth in Q1 FY26 is driven by enhanced customer adoption and improved top-line performance, building on previous gains in key subscription segments, which contributed to an upward shift from a lower base in Q1 FY25. " "

Subscription Revenue

11.6% increase (from $603 million in Q1 FY25 to $673 million in Q1 FY26)

Subscription revenue improved due to increased sales of additional solutions and user growth, continuing the momentum from previous periods where similar strategic initiatives and customer expansion had already strengthened recurring revenue streams. " "

Operating Profit

Turnaround from an operating loss of –$47 million in Q1 FY25 to a profit of $39 million in Q1 FY26 (a swing of $86 million)

The operating profit turnaround reflects significant improvements in operating efficiency and expense management. Previous period challenges were overcome by discipline in cost control and a higher revenue base, contributing to a dramatic improvement in profitability. " "

Net Income

Reversal from a loss of –$40 million in Q1 FY25 to a profit of $62 million in Q1 FY26

The net income reversal is the result of stronger operating performance and reduced expenses relative to the previous period, with a recovery built upon the enhanced revenue generation and tighter cost oversight that offset the prior period’s losses of over $100 million. " "

Balance Sheet Strength

Cash increased by 53% (from $322 million to $494 million), short-term investments up 11.6% (from $1,998 million to $2,231 million), total liabilities down 6.8% (to $2,798 million), and stockholders’ equity up 10.3% (to $6,567 million)

Balance sheet improvements were achieved through robust operating cash flows and strategic liquidity management. The strong cash generation, coupled with prudent investment in short-term securities and a reduction in liabilities, supported by net income gains and incremental equity growth, marked an overall healthier financial position compared to Q1 FY25. " "

Total Revenue Growth

Q2 FY 2026

10% "

10% "

no change

Current RPO Growth

Q2 FY 2026

12% "

10% to 11% "

lowered

Non-GAAP Operating Margin

Q2 FY 2026

25% "

26% "

raised

Free Cash Flow Margin

Q2 FY 2026

Approximately 25% "

Approximately 19% "

lowered

Total Revenue Growth

FY 2026

9% to 10% "

9% to 10% "

no change

Non-GAAP Operating Margin

FY 2026

25% "

25% "

no change

Free Cash Flow Margin

FY 2026

Approximately 26% "

Approximately 27% "

raised

New Product Innovation & Portfolio Expansion

Mentioned consistently in Q4 2025 ( " " ) with strong contributions from products like OIG, Privileged Access, and others; Q3 2025 ( " " ) emphasized new product bookings and visible ramp-up; Q2 2025 ( " " ) focused on rapid adoption and broad product pipeline.

Q1 2026 call reiterated robust new product performance with strong contribution from OIG, Privileged Access, Device Access and others, plus record workflow execution growth and mainstream adoption ( " ).

Consistently positive emphasis with deeper integration and continued momentum in innovation.

Product Bundling & Suite-Based Pricing

Q4 2025 ( " ) detailed Workforce Identity suites with “good, better, best” packaging; Q3 2025 ( " ) described the exploration of bundling versus a la carte pricing; Q2 2025 had no mention.

Q1 2026 highlighted the formal introduction of suite-based pricing to drive cross-sell opportunities and consolidate identity solutions, reinforcing a unified market message ( " ).

Evolution from exploratory discussions to a well-defined, successful bundling strategy that is driving customer consolidation.

Go-to-Market Specialization & Sales Team Realignment

Q4 2025 ( " " " ) and Q3 2025 ( " ) emphasized the move to specialized teams (Okta vs Auth0) with early signs of increased productivity; Q2 2025 ( " ) discussed the early implementation of the hunter-farmer model.

Q1 2026 focused on further specialization—dividing teams into Okta and Auth0 sellers with encouraging early signals, improved pipeline, and better rep metrics ( " " ).

Consistent emphasis with incremental improvements; acknowledging short-term change costs while anticipating long-term benefits.

Large Enterprise & Public Sector Growth

Q4 2025 ( " " ) and Q3 2025 ( " " ) stressed strong large enterprise wins and federal wins; Q2 2025 ( " " ) highlighted significant penetration in Global 2000 accounts with growing contract durations.

Q1 2026 underscored significant growth in large enterprise accounts (20% increase in $1M+ ARR deals) and strong public sector wins (top deals in public sector vertical) ( " " ).

Continued focus on enterprise and public sector segments with deeper product maturity and improved contract values.

Subscription Revenue Growth & Booking Trends

Q4 2025 ( " " ) reported record bookings driven by partners and new product contributions; Q3 2025 ( " " " ) mentioned strong upsell and new logo wins though details were more qualitative; Q2 2025 ( " ) provided revenue guidance without detailed subscription metrics.

Q1 2026 reported a modest $3M sequential increase in subscription revenue – noted as the lowest since going public – and outlined expectations for seasonality with declining cRPO in Q2 ( " " ).

Shift from record bookings to a more moderate subscription revenue beat, reflecting seasonality and tighter guidance philosophies.

Macro Economic Uncertainty Impact

Q4 2025 ( " " ) and Q3 2025 ( " " ) included discussions on conservative purchasing and revised guidance due to a cautious macro outlook; Q2 2025 ( " " ) noted the impact on new logos and license counts.

Q1 2026 executives reiterated that while the sentiment among customers is becoming more negative, the numbers have not deteriorated yet; guidance now incorporates additional conservatism given broader economic uncertainty ( " " " ).

Persistent macro headwinds remain, with greater caution in guidance while immediate impacts are not yet visible.

Declining cRPO & Revenue Conversion Concerns

Q4 2025 ( " " ) addressed cRPO as being affected by seasonality and strategic renewals; Q3 2025 ( " " ) discussed lower cRPO growth relative to total RPO due to adjustments in guidance; Q2 2025 ( " " ) acknowledged conservative outlooks due to previous security incidents and macro challenges.

Q1 2026 focused on declining cRPO (second consecutive sequential decline) and a modest subscription revenue beat, explained as seasonality and changes in guidance philosophy rather than structural issues ( " " " ).

Ongoing challenge viewed as seasonal; management emphasizes focusing on dollar metrics and coverage ratios to mitigate revenue conversion concerns.

AI & Machine Identity Integration (Auth for GenAI)

Q4 2025 ( " " " ) emphasized Auth for GenAI for securely managing AI agent identities and its potential monetization; Q3 2025 ( " ) discussed the need for AI integration and machine identity security with early monetization focus; Q2 2025 had no discussion.

Q1 2026 provided detailed coverage of Auth for GenAI, including its developer preview, integration of secure authentication for AI agents, usage-based pricing, and expected GA launch in summer 2025, highlighting its strategic role in the AI-driven landscape ( " " " ).

Growing significance with strong product vision, building on earlier interest; reflects rising market adoption for AI-led identity solutions.

International Expansion Challenges

Q4 2025 ( " ) noted that international revenue was around 20% and recognized the need to grow it while balancing strong North American performance; Q3 2025 ( " ) elaborated on tougher economic conditions in Europe and importance of partnerships; Q2 2025 had no mention.

Q1 2026 did not specifically mention international challenges, though noting that international growth accelerated more than U.S. growth ( " ).

Shift in focus – earlier calls identified challenges, but Q1 did not highlight issues, possibly reflecting improved performance or deprioritization.

Cost Pressures & Margin Impacts from Sales Specialization

Q4 2025 ( " " ) discussed sales specialization with focus on productivity gains though without mentioning direct margin pressure; Q3 2025 ( " " ) detailed short-term cost increases as part of specialization investments; Q2 2025 ( " " ) noted early changes with an emphasis on efficiency improvement.

Q1 2026 acknowledged the cost of change due to the realignment into specialized teams, yet highlighted encouraging early pipeline strength and overall resilient performance despite added conservatism in guidance ( " " " ).

Increasing short-term cost pressures are recognized but are expected to yield long-term gains in sales productivity and margins.

SMB Segment Weakness & Net Retention Decline

Q2 2025 ( " ) reported weakness in the SMB segment with net retention declining slightly; Q3 2025 ( " " ) noted concentration in SMB logos and pressure from legacy, COVID-era customers impacting NRR; Q4 2025 ( " ) mentioned strong net retention (107%) but without highlighting SMB-specific issues.

Q1 2026 indicated that the U.S. SMB market has transitioned to a hunter-farmer model with positive performance, but overall net retention has declined for the fourth consecutive quarter due to headwinds from older cohorts ( " " " ).

Mixed signals – while the SMB model shows improvements, overall net retention remains under pressure from legacy cohort challenges.

Seat-Based Contract Headwinds

Q2 2025 ( " " " ) and Q3 2025 ( " " " ) discussed lower seat purchases due to cautious buying, noting headwinds from budget scrutiny and legacy contracts; Q4 2025 ( " ) noted that customers now rightsize their contracts due to macro shifts.

Q1 2026 reiterated that seat-based headwinds persist, particularly from older customer cohorts at renewals, with caution that economic shifts could further impact these dynamics ( " " ).

Consistent pressure from a shift in customer buying behavior; headwinds remain though partially offset by successful upsell efforts.