By Kuldip K. Ambastha
On Thursday, September 1, 2022, the stock of Okta, Inc. (OKTA), a technology company providing cloud-based identity management support for businesses, fell in price by -33.7% per share for the trading day. While 2Q2022 results surpassed Wall Street expectations, areas of concern on a going forward basis drove this sharp decline in the share price and many equity research analysts have downgraded the stock. Specifically, Auth0 (acquired in 2021) has not been successfully integrated into Okta at this time, and sales professionals affiliated with Auth0 have been leaving Okta at an elevated rate. Okta leadership may need to consider changes in sales compensation structures and in corporate strategies to improve profitability in the future. Tough decisions could lie ahead, especially as more and more technology companies are initiating workforce reduction plans given the current economic landscape.
Disclosure – The principals and clients of Ambastha Financial LLC have no positions in OKTA.
Disclaimer – No recommendations are being made via this post. Past performance is not an indicator of future performance. As an investor, you should do your own research and seek professional advice from a Registered Investment Adviser (RIA). You can lose money by investing in stocks and other instruments. Ambastha Financial LLC does not assume any responsibility (legal or otherwise) for any losses that may occur as a result of actions taken based on this post. All content copyrighted © 2022 – Ambastha Financial LLC.