Okta's Backlog Tops $4B on Strong Identity Security Demand

Okta’s OKTA Remaining Performance Obligations (RPO) or subscription backlog surged to $4.084 billion in the first quarter of fiscal 2026, marking a 21% year-over-year increase. More importantly, current RPO jumped 14% year over year to $2.23 billion, highlighting the company’s strong forward 12-month revenue visibility. This significant backlog growth reflects sustained enterprise demand for OKTA’s identity security solutions, as organizations prioritize secure access in increasingly complex IT environments.

The company benefits from strong demand for its new products, including Identity Governance, Privileged Access, Device Access, Fine Grained Authorization, Identity Security Posture Management and Identity Threat Protection with Okta AI. Okta’s Identity Security Posture Management and Privileged Access solutions are helping enterprises tackle non-human identities that comprise service accounts, shared accounts, machines and tokens.

For the second quarter of fiscal 2026, OKTA projects current RPO growth in the range of 10% to 11%. While the guidance reflects a slightly cautious outlook amid ongoing macroeconomic headwinds, it still indicates resilient demand and solid revenue visibility.

OKTA Faces Stiff Competition From CyberArk & Microsoft

As identity and access management becomes a top priority for enterprises, Okta faces stiff competition from seasoned players like CyberArk Software CYBR and Microsoft MSFT.

CyberArk leads in Privileged Access Management, offering advanced tools like credential vaulting and threat analytics. With its acquisition of Zilla Security, it’s expanding into automated Identity Governance. This move strengthens CyberArk’s Identity Security Platform, boosting compliance and efficiency. 

Microsoft’s Entra ID poses a significant challenge by offering a fully integrated Identity and Access Management solution, including Single Sign-On, Multi-Factor Authentication, Conditional Access and Identity Protection.

OKTA’s Price Performance, Valuation & Estimates

Shares of Okta have appreciated 27.7% year to date compared with the Zacks Security industry’s return of 19.9%.

Okta currently trades at a premium, with a forward Price/Cash Flow ratio of 23.83, higher than the broader Zacks Computer & Technology sector’s 20.4X. OKTA has a Value Score of D.
 

The Zacks Consensus Estimate for OKTA’s 2026 revenues is pegged at $2.86 billion, indicating 9.44% year-over-year growth. The consensus mark for earnings is pegged at $3.28 per share, which increased 2.8% over the past 30 days. The earnings figure suggests 16.73% growth over the figure reported in fiscal 2025.
 

OKTA stock currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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