Sands Capital Technology Innovators Fund Exited Its Position in Okta (OKTA) in Q3

Sands Capital, an investment management company, released its Q3 2025 investor letter for the “Sands Capital Technology Innovators Fund.” A copy of the letter can be downloaded here. Technology Innovators focus on pioneering businesses worldwide that serve as key drivers or beneficiaries of significant, long-term technological changes. The fund returned 8.4% (net) in the third quarter compared to a 12.5% return for the benchmark, MSCI ACWI Info Tech and Communication Services Index. Despite concentrated leadership, global equities appreciated in the third quarter, as measured by the MSCI ACWI. The United States accounted for almost 70 percent of the index's increase, while developed markets outside the U.S. and emerging markets also provided positive returns. You can check the fund’s top 5 holdings to know more about its best picks for 2025.

In its third-quarter 2025 investor letter, Sands Capital Technology Innovators Fund highlighted stocks such as Okta, Inc. (NASDAQ:OKTA). Okta, Inc. (NASDAQ:OKTA) is an identity partner that offers products and services to manage and secure identities. The one-month return of Okta, Inc. (NASDAQ:OKTA) was -11.80%, and its shares lost 0.64% of their value over the last 52 weeks. On November 28, 2025, Okta, Inc. (NASDAQ:OKTA) stock closed at $80.33 per share, with a market capitalization of $14.161 billion.

Sands Capital Technology Innovators Fund stated the following regarding Okta, Inc. (NASDAQ:OKTA) in its third quarter 2025 investor letter:

"Finally, we exited our investment in Okta, Inc. (NASDAQ:OKTA) to reallocate capital to higher-conviction opportunities. Since our initial investment in March 2020, Okta has faced challenges, including security breaches and a smaller-than-expected addressable market, due in part to Microsoft’s bundled offerings. These issues contributed to a faster-than anticipated deceleration in revenue growth. While we remained patient, expecting improved execution, broader product adoption, and a tailwind from agentic AI, we lost confidence in management’s ability to establish Okta as the leader in identity. After a prolonged downturn across the software sector, we no longer viewed Okta as offering a compelling balance of risk and opportunity relative to other businesses in which we hold stronger conviction."

Okta, Inc. (NASDAQ:OKTA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 55 hedge fund portfolios held Okta, Inc. (NASDAQ:OKTA) at the end of the third quarter, which was 57 in the previous quarter. While we acknowledge the potential of Okta, Inc. (NASDAQ:OKTA) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Okta, Inc. (NASDAQ:OKTA) and shared the list of best American AI stocks to buy according to analysts. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.