Delaware (State or other jurisdiction of incorporation or organization) | 001-38044 (Commission File Number) | 26-4175727 (I.R.S. Employer Identification Number) |
301 Brannan Street San Francisco, California 94107 | ||
(Address of principal executive offices and zip code) | ||
(888) 722-7871 | ||
(Registrant's telephone number, including area code) | ||
___________________________________ |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Exhibit Number | Description | |
99.1 | Press release dated June 7, 2017, issued by Okta, Inc. |
Okta, Inc. | ||
By: | /s/ William E. Losch | |
Name: | William E. Losch | |
Title: | Chief Financial Officer | |
Exhibit Number | Description | |
99.1 | Press release dated June 7, 2017, issued by Okta, Inc. | |
• | Q1 total revenue up 67% year-over-year; subscription revenue up 75% year-over-year |
• | Q1 GAAP operating margin improved by 17 percentage points; Non-GAAP operating margin improved by 24 percentage points, year-over-year |
• | Company raised $200 million in Initial Public Offering |
• | Revenue: Total revenue was $53.0 million, an increase of 66.8% year-over-year. Subscription revenue was $48.4 million, an increase of 75.4% year-over-year. |
• | Operating Loss: GAAP operating loss was $28.6 million, or 54.0% of total revenue, compared to $22.7 million in the first quarter of fiscal 2017, or 71.4% of total revenue. Non-GAAP operating loss was $19.7 million, or 37.2% of total revenue, compared to $19.3 million of the first quarter of fiscal 2017, or 60.7% of total revenue. |
• | Net Loss: GAAP net loss was $28.9 million, compared to $22.8 million in the first quarter of fiscal 2017. GAAP net loss per share was $0.73, compared to $1.22 for the first quarter of fiscal 2017. Non-GAAP net loss was $20.0 million, compared to $19.3 million in the first quarter of fiscal 2017. Non-GAAP net loss per share was $0.50, compared to $1.04 for the first quarter of fiscal 2017. |
• | Cash Flow: Net cash used in operations was $9.7 million, compared to $15.0 million for the first quarter of fiscal 2017. Free cash flow was negative $13.3 million, or 25.2% of total revenue, compared to negative $17.2 million, or 54.1% of total revenue, in the first quarter of fiscal 2017. |
• | Cash and cash equivalents and short term investments were $224.2 million as of April 30, 2017. |
• | Total revenue of $55.0 to $56.0 million |
• | Non-GAAP operating loss of $24.0 to $23.0 million |
• | Non-GAAP net loss per share of $0.26 to $0.25 using shares outstanding of approximately 92.5 million |
• | Total revenue of $233.0 to $236.0 million |
• | Non-GAAP operating loss of $91.2 to $88.2 million |
• | Non-GAAP net loss per share of $1.15 to $1.11 using shares outstanding of approximately 80.2 million |
Three Months Ended April 30, | |||||||
2017 | 2016 | ||||||
Revenue | |||||||
Subscription | $ | 48,357 | $ | 27,563 | |||
Professional services and other | 4,650 | 4,224 | |||||
Total revenue | 53,007 | 31,787 | |||||
Cost of revenue | |||||||
Subscription (1) | 11,157 | 7,460 | |||||
Professional services and other (1) | 6,306 | 4,919 | |||||
Total cost of revenue | 17,463 | 12,379 | |||||
Gross profit | 35,544 | 19,408 | |||||
Operating expenses | |||||||
Research and development (1) | 15,359 | 8,766 | |||||
Sales and marketing (1) | 37,180 | 26,401 | |||||
General and administrative (1) | 11,639 | 6,945 | |||||
Total operating expenses | 64,178 | 42,112 | |||||
Operating loss | (28,634 | ) | (22,704 | ) | |||
Other income (expense), net | (19 | ) | 32 | ||||
Loss before income taxes | (28,653 | ) | (22,672 | ) | |||
Provision for income taxes | 248 | 81 | |||||
Net loss | $ | (28,901 | ) | $ | (22,753 | ) | |
Net loss per common share, basic and diluted | $ | (0.73 | ) | $ | (1.22 | ) | |
Weighted-average shares used to compute net loss per common share | 39,783 | 18,574 |
(1) | Amounts include share-based compensation expense as follows (in thousands): |
Three Months Ended April 30, | |||||||
2017 | 2016 | ||||||
Cost of subscription revenue | $ | 686 | $ | 393 | |||
Cost of professional services and other revenue | 469 | 273 | |||||
Research and development | 3,301 | 618 | |||||
Sales and marketing | 2,375 | 1,354 | |||||
General and administrative | 2,075 | 731 | |||||
Total share-based compensation expense | $ | 8,906 | $ | 3,369 |
April 30, 2017 | January 31, 2017 | ||||||
(unaudited) | |||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 221,726 | $ | 23,282 | |||
Short-term investments | 2,500 | 14,390 | |||||
Accounts receivable, net of allowances of $1,025 and $1,306 | 32,171 | 34,544 | |||||
Deferred commissions | 13,131 | 13,549 | |||||
Prepaid expenses and other current assets | 10,271 | 7,025 | |||||
Total current assets | 279,799 | 92,790 | |||||
Property and equipment, net | 13,180 | 11,026 | |||||
Deferred commissions, noncurrent | 9,463 | 10,050 | |||||
Intangible assets, net | 9,835 | 9,155 | |||||
Goodwill | 6,282 | 2,630 | |||||
Other assets | 1,671 | 4,984 | |||||
Total assets | $ | 320,230 | $ | 130,635 | |||
Liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit) | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 15,909 | $ | 11,897 | |||
Accrued expenses and other current liabilities | 4,822 | 5,853 | |||||
Accrued compensation | 6,613 | 9,866 | |||||
Deferred revenue | 115,717 | 108,012 | |||||
Total current liabilities | 143,061 | 135,628 | |||||
Deferred revenue, noncurrent | 4,927 | 5,711 | |||||
Other liabilities, noncurrent | 6,323 | 4,947 | |||||
Total liabilities | 154,311 | 146,286 | |||||
Commitments and contingencies (Note 8) | |||||||
Redeemable convertible preferred stock | — | 227,954 | |||||
Stockholders’ equity (deficit): | |||||||
Preferred stock | — | — | |||||
Class A common stock | 1 | — | |||||
Class B common stock | 8 | 2 | |||||
Additional paid-in capital | 483,019 | 44,469 | |||||
Accumulated other comprehensive loss | (99 | ) | (167 | ) | |||
Accumulated deficit | (317,010 | ) | (287,909 | ) | |||
Total stockholders’ equity (deficit) | 165,919 | (243,605 | ) | ||||
Total liabilities, redeemable convertible preferred stock and stockholders’ equity (deficit) | $ | 320,230 | $ | 130,635 |
Three Months Ended April 30, | |||||||
2017 | 2016 | ||||||
Operating activities: | |||||||
Net loss | $ | (28,901 | ) | $ | (22,753 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation, amortization and accretion | 1,575 | 887 | |||||
Stock-based compensation | 8,906 | 3,369 | |||||
Amortization of deferred commissions | 4,039 | 3,053 | |||||
Other | 270 | (130 | ) | ||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 2,243 | 3,090 | |||||
Deferred commissions | (3,033 | ) | (2,756 | ) | |||
Prepaid expenses and other assets | (3,143 | ) | (2,876 | ) | |||
Accounts payable | 3,782 | 3,681 | |||||
Accrued compensation | (2,121 | ) | (2,855 | ) | |||
Accrued expenses and other liabilities | (223 | ) | (182 | ) | |||
Deferred revenue | 6,920 | 2,437 | |||||
Net cash used in operating activities | (9,686 | ) | (15,035 | ) | |||
Investing activities: | |||||||
Capitalization of internal-use software costs | (1,208 | ) | (1,232 | ) | |||
Purchases of property and equipment and other | (2,448 | ) | (927 | ) | |||
Other investing activities | 11,873 | 3,000 | |||||
Net cash provided by investing activities | 8,217 | 841 | |||||
Financing activities: | |||||||
Proceeds from initial public offering, net of underwriters' discounts and commissions | 199,997 | — | |||||
Other financing activities | 111 | (337 | ) | ||||
Net cash provided by (used in) financing activities | 200,108 | (337 | ) | ||||
Effects of changes in foreign currency exchange rates on cash and cash equivalents | 68 | 47 | |||||
Net increase (decrease) in cash and cash equivalents and restricted cash | 198,707 | (14,484 | ) | ||||
Cash and cash equivalents and restricted cash at beginning of year | 23,282 | 58,081 | |||||
Cash and cash equivalents and restricted cash at end of year | $ | 221,989 | $ | 43,597 |
Three Months Ended April 30, 2017 | ||||||||||||||||
GAAP | Stock-based compensation | Amortization of acquired intangibles | Non-GAAP | |||||||||||||
Costs and expenses: | ||||||||||||||||
Cost of subscription services | $ | 11,157 | $ | (686 | ) | $ | (4 | ) | $ | 10,467 | ||||||
Cost of professional services | 6,306 | (469 | ) | — | 5,837 | |||||||||||
Gross profit | 35,544 | 1,155 | 4 | 36,703 | ||||||||||||
Gross margin | 67 | % | 2 | % | — | 69 | % | |||||||||
Research and development | 15,359 | (3,301 | ) | — | 12,058 | |||||||||||
Sales and marketing | 37,180 | (2,375 | ) | — | 34,805 | |||||||||||
General and administrative | 11,639 | (2,075 | ) | — | 9,564 | |||||||||||
Operating loss | (28,634 | ) | 8,906 | 4 | (19,724 | ) | ||||||||||
Operating margin | (54 | )% | 17 | % | — | (37 | )% | |||||||||
Net loss | $ | (28,901 | ) | $ | 8,906 | $ | 4 | $ | (19,991 | ) | ||||||
Net loss per share (1) | $ | (0.73 | ) | $ | 0.22 | $ | 0.01 | $ | (0.50 | ) |
Three Months Ended April 30, 2016 | ||||||||||||||||
GAAP | Stock-based compensation | Amortization of acquired intangibles | Non-GAAP | |||||||||||||
Costs and expenses: | ||||||||||||||||
Cost of subscription services | $ | 7,460 | $ | (393 | ) | $ | (47 | ) | $ | 7,020 | ||||||
Cost of professional services | 4,919 | (273 | ) | — | 4,646 | |||||||||||
Gross profit | 19,408 | 666 | 47 | 20,121 | ||||||||||||
Gross margin | 61 | % | 2 | % | — | 63 | % | |||||||||
Research and development | 8,766 | (618 | ) | — | 8,148 | |||||||||||
Sales and marketing | 26,401 | (1,354 | ) | — | 25,047 | |||||||||||
General and administrative | 6,945 | (731 | ) | — | 6,214 | |||||||||||
Operating loss | (22,704 | ) | 3,369 | 47 | (19,288 | ) | ||||||||||
Operating margin | (71 | )% | 10 | % | — | (61 | )% | |||||||||
Net loss | $ | (22,753 | ) | $ | 3,369 | $ | 47 | $ | (19,337 | ) | ||||||
Net loss per share (1) | $ | (1.22 | ) | $ | 0.18 | $ | — | $ | (1.04 | ) |
Free Cash Flow | |||||||
Three Months Ended April 30, | |||||||
2017 | 2016 | ||||||
Net cash used in operating activities | $ | (9,686 | ) | $ | (15,035 | ) | |
Less: | |||||||
Purchases of property and equipment | (2,448 | ) | (927 | ) | |||
Capitalized internal-use software costs | (1,208 | ) | (1,232 | ) | |||
Free Cash Flow | $ | (13,342 | ) | $ | (17,194 | ) | |
Net cash provided by investing activities | $ | 8,217 | $ | 841 | |||
Net cash (used in) provided by financing activities | $ | 200,108 | $ | (337 | ) | ||
Free Cash Flow Margin | (25 | )% | (54 | )% |
Calculated Billings | |||||||
Three Months Ended April 30, | |||||||
2017 | 2016 | ||||||
Total revenue | $ | 53,007 | $ | 31,787 | |||
Add: | |||||||
Deferred revenue (end of period) | 120,644 | 81,962 | |||||
Less: | |||||||
Deferred revenue (beginning of period) | (113,723 | ) | (79,525 | ) | |||
Calculated Billings | $ | 59,928 | $ | 34,224 |