Okta's quarterly results and a new growth area

Okta generated $805 million in revenue in its fiscal second quarter, up 11% from the same period a year earlier. But the headline for the company was not just the earnings report: it was AI agent security, a category that enterprises are increasingly funding.

Subscription revenue rose 12% to $793 million. Remaining performance obligations increased to about $4.86 billion, up 17% year over year. The company also said current remaining performance obligations reached $2.585 billion, representing a 14% increase.

Operating cash flow came in at $234 million, while free cash flow was $227 million. After these results, Okta raised its full-year revenue forecast to roughly $3.22 billion to $3.23 billion.

Todd McKinnon said, “Every agent needs a trusted identity and clear controls that define what it can access.”

Why companies have to manage AI agent identities

In enterprise software, AI agents are increasingly being used to read emails, update customer records, query databases and trigger business workflows. But the more access these systems are given, the greater the risk if they are compromised or make an error.

According to a CyberArk survey, 79% of companies expect machine identities to increase next year. Roughly two-thirds of respondents expect that growth to be as much as 50%, while 16% predict an increase of between 50% and 150%.

Okta's Okta for AI Agents product, which the company made generally available this year, is designed to detect AI agents, grant access based on the principle of least privilege, and centrally manage what those agents can do. That opens a new market in which the company could generate revenue not only from human worker authentication, but also from overseeing digital workers.

Market impact and risks investors are watching

Data supporting security spending is also drawing attention. Verizon's 2026 Data Breach Investigations Report says shadow AI use rose to 45%, while software vulnerabilities were responsible for 31% of initial access in breaches. IBM, meanwhile, estimates the average cost of a cyberattack at more than $5 million globally.

What stands out for Wall Street

  • Results above expectations and a higher full-year forecast helped support gains in Okta shares.
  • AI agent security is emerging as a new subscription and security-spending category in identity and access management.

Even so, the market is also noting that this category is still at an early stage. Slower-than-expected adoption of AI agents by companies, or major software platforms building identity controls into their own products, are among the main risks that could affect Okta's growth rate in this area.