Okta Stock Soars 20% on Strong Q2, AI Security Growth

Okta's stock surged over 20% in after-hours trading, breaking its 52-week high. This comes after the company reported strong second-quarter results. Okta's revenue hit $805 million, marking an 11% year-over-year growth, and adjusted earnings per share reached $1.05. Here's the thing: The company also announced a record bookings quarter outside of a fourth quarter period. New products, many of them AI-focused, represented 30% of these bookings. What's interesting is that these new products led to a 40% average increase in contract value when included in deals. Okta also agreed to acquire Permiso Security for $200 million, adding AI-focused identity threat detection capabilities. The company raised its full-year guidance, now expecting $3.22 billion in revenue and $910 to $930 million in free cash flow. This means that AI is driving significant growth in the identity security market.