Hot Stock to watch: Okta Inc (NASDAQ: OKTA)

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Okta Inc (NASDAQ: OKTA) stock rose over 2.6% (As of 11:01:47 December 9th, 2019; Source: Investing.com) as the company posted better than expected results for the third quarter of FY 20 and raised the guidance for full year. OKTA has ended the third quarter with $1.37 billion in cash, cash equivalents and short-term investments, which reflects the net increase of $809 million sequentially. The increase is also on the back of the issuance of approximately $1 billion of convertible senior notes, which was partially offset by the $224 million repurchase of a portion of the existing convertible senior notes. OKTA has delivered the net loss of $63.5 million compared to a loss of $29.5 million in the previous year quarter.

OKTA in the third quarter of FY 20 has reported the adjusted loss per share of 7 cents, beating the analysts’ estimates for the adjusted loss per share of 12 cents. The company had reported the adjusted revenue growth of 45 percent to $153 million in the third quarter of FY 20, beating the analysts’ estimates for revenue of $143.7 million. The revenue growth is driven by 48% increase in subscription revenue. Subscription revenue forms 94% of the total revenue. Total RPO has crossed the $1 billion mark for the first time. Total calculated billings have increased by 42% and current calculated billings have also increased 41%. The increase in billings continues to be due to both new and existing customers across all the markets.

For the fourth quarter of fiscal 2020, the company expects the total revenue to be in the range of $155 million to $156 million, which represents a growth rate of 34% to 35% year-over-year.

Non-GAAP operating loss is expected to be in the range of $10.1 million to $9.1 million, non-GAAP net loss per share is expected to be in the range of $0.05 to $0.04 assuming weighted shares outstanding of approximately $122 million.

The company now expects full-year fiscal 2020 revenue to be in the range of $574 million and $575 million, representing 44% year-over-year growth. Previously, management had expected full-year revenue to grow in the range between 40% and 41% year over year. Okta now expects its adjusted net loss per share in fiscal 2020 to be in the range of $0.35 and $0.34, up from a previous forecast for an adjusted loss per share between $0.44 and $0.42. Non-GAAP operating loss is expected to be in the range of $53.1 million to $52.1 million for FY 20.

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