Financial Data and Key Metrics Changes - In Q3 FY 2026, the company reported total revenue growth of 10% and raised its full-year revenue growth outlook to 11% [17][18] - The non-GAAP operating margin for Q4 is expected to be 25%, with a full-year margin of 26% [17][18] - Free cash flow margin is projected at approximately 31% for Q4 and around 29% for the full year [17][18] Business Line Data and Key Metrics Changes - The company experienced strength with large customers and upsells in its workforce segment, particularly with new products like Okta Identity Governance [6][7] - New products are contributing significantly to results, with a record number of customers engaging with Okta's offerings [7][9] Market Data and Key Metrics Changes - The company has over 20,000 customers, positioning it well to become the identity layer for AI agents [9][10] - There is a surge in interest for agentic security solutions, with over 100 current customers representing more than $200 million in existing ARR [10][11] Company Strategy and Development Direction - The company is focusing on securing AI agents and non-human identities, which is seen as a critical growth opportunity [8][12] - Okta is investing in innovation and expanding its product portfolio to simplify customer interactions and enhance security [7][14] - The strategy includes increasing the number of quota-carrying sales representatives to meet growing demand [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the upcoming Q4, which is expected to be the largest quarter of the year, and highlighted strong business momentum [44][46] - The company is confident in its strategy to capture emerging opportunities in the identity security space, particularly related to AI [14][35] Other Important Information - The company ended Q3 with nearly $2.5 billion in cash, cash equivalents, and short-term investments, indicating a strong balance sheet [17] - The company is evaluating its capital structure and considering investments in business growth, M&A, and opportunistic repurchases of outstanding notes [17] Q&A Session Summary Question: What convinces customers to consolidate their identity management with Okta? - Management noted that technological changes, particularly related to AI, are driving customers to consolidate their identity management systems with Okta [24][26] Question: Can AI capabilities be deployed by non-Okta customers? - Management confirmed that while many customers are interested in AI capabilities, the deployment can be applicable to any company, not just existing Okta customers [30][33] Question: How does the company view its guidance for the next fiscal year? - Management refrained from providing specific guidance for FY 2027, citing the need to assess Q4 performance first, but expressed confidence in business momentum and growth opportunities [40][48] Question: What is the status of the sales realignment efforts? - Management reported positive outcomes from the sales realignment, with improved sales productivity and lower attrition rates among account executives [80][81] Question: How is the company addressing the challenge of agentic commerce? - Management highlighted the importance of Auth0 for AI Agents in enabling businesses to build and manage agents effectively, addressing security and access challenges [59][62]

Financial Data and Key Metrics Changes - The company reported solid Q2 results with total revenue growth of 10% to 11% for FY '26, an increase from previous guidance of 9% to 10% [18] - Non-GAAP operating margin is expected to be between 25% to 26% for FY '26, up from previous estimates [18] - Free cash flow margin is projected to be approximately 28% for FY '26, indicating improved profitability and cash flow [18] Business Line Data and Key Metrics Changes - The public sector business showed strong performance with multiple new business and upsell deals, including significant contracts with the DOD [15][16] - New products from Okta Identity Governance, Okta Privilege Access, and others contributed positively to revenue, highlighting the success of the unified identity platform [5][12] - The company experienced a record pipeline generation, reflecting improved sales productivity from specialized go-to-market teams [13][18] Market Data and Key Metrics Changes - Five of the top ten deals in Q2 were with the US public sector, indicating strong demand in this market [16] - The company noted that the macroeconomic uncertainties previously affecting guidance did not materialize, allowing for a more optimistic outlook [13][18] Company Strategy and Development Direction - The company is focused on building an identity security fabric that secures all identities, including AI agents, emphasizing the importance of independence and neutrality in the identity market [7][11] - The acquisition of Acxiom Security is expected to enhance Okta's Privilege Access capabilities and support the integration of new technologies [6][73] - The company aims to consolidate identity solutions for customers, reducing vendor complexity and operational costs [42][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and execution, noting that the go-to-market realignment is showing positive signals [13][19] - The company is optimistic about the adoption of new products and the rapid pace of innovation, positioning itself to lead the identity industry [19] - Management highlighted the importance of addressing current identity security challenges as organizations increasingly adopt AI technologies [70][71] Other Important Information - The company ended the quarter with approximately $2.9 billion in cash and short-term investments, indicating a strong balance sheet [17] - The upcoming Oktane Conference will showcase innovations and provide insights into the company's future direction [10] Q&A Session Summary Question: What indicators are used for guidance and NRR stabilization? - Management noted that NRR has stabilized and emphasized the importance of sales productivity and pipeline generation as indicators for future guidance [20][24][26] Question: What trends are seen in AI native customer adoption? - Management indicated that AI native customers are growing rapidly and are focused on securing their internal operations, similar to other customer cohorts [32][34] Question: Why is identity critical as an independent platform? - Management explained that identity must be independent to reduce fragmentation and operational complexity, allowing companies to consolidate vendors effectively [42][46] Question: How is the sales force productivity evolving? - Management reported increased productivity from specialized sales teams and noted record pipeline generation, reflecting the success of their go-to-market strategy [56][60] Question: What is the monetization strategy for cross-app access? - Management stated that cross-app access will enhance the value of identity providers and will be monetized through existing products while addressing current identity security challenges [102][104]