Right. Good morning, everybody. Welcome to Investor Summit at Oktane 2026. We have about an hour. We are going to take questions in the room, but we are going to be joined by Todd McKinnon, our Co-Founder and CEO. Todd McKinnon.
It is our opportunity to push the whole industry forward and help them create this secure agentic enterprise. It is like we are not going to waste this opportunity. We are going to meet this moment and lead the industry and do everything in our power to build a culture and a company and a set of products and capabilities that meet this moment. It is very exciting. It is super motivating for all of us, and we are excited to talk about it at Oktane. For many of you that have been on the journey with us for a while, it is great to see so many familiar faces. You see a lot of the same themes resonating, but in a new way that is even more relevant than ever in this agentic world.
It really is a transformation of every layer in the stack, and folks that have been around a long time can sense how the potential there. We also know that it is going to take a while. Everything has to be transformed, and it is going to be some vendors are going to make the transition, some are not. There is going to be lots of new vendors. There is going to be different dynamics in the industry, but Okta is very committed to really winning in this era and building a long-term value-creating company. Thanks for all the support and thanks for coming to Oktane. We are excited to answer some questions to try to illustrate what we are up to in a little bit more detail. David, you are going to make the decision who gets to ask? Awesome. Be nice to David.
Thank you, David. Keith Bachman from Bank of Montreal, and I appreciate the time. Todd, I just wanted to ask you a question about the market dynamics. What I mean by that is your keynote today highlighted Blueprint, which is a way to try to bring vendors together. Underneath that, you talk about messages such as governance and orchestration are key themes. Yet there is a lot of vendors trying to get into that space. Not only security vendors. IBM has watsonx.governance, watsonx Orchestrate. ServiceNow has Control Tower, which the value proposition sounds remarkably like some of the things that you are trying to do.
I just wondered if you could talk a little bit about Okta's positioning here and right to win when there's a lot of folks trying to go after the same real estate, and not even necessarily security vendors, but a lot of folks trying to have that governance and orchestration layer, which is necessary for adoption. Just talk a little bit about the competitive dynamics and your right to win.
I think there's a lot of work to do. Fundamental to our strategy and our belief is that agentic is not one discrete thing. It's really a transformation of every layer in the stack. It's new agents, it's new platforms to build agents, but it's also agents in every part of the stack. You've heard us say this several times now. But the implications of that are that when you talk about Control Tower or management and visibility, there's actually a lot of work to do there. For example, a Control Tower and visibility in terms of the effectiveness and the ROI, the business ROI of agents, you could put a Control Tower on that. It's actually very different from a visibility and security governance Control Tower.
I guess it's a long-winded way of saying that there's a lot of opportunity for all of us to be successful, which is why strategically, the point of the Blueprint is we're trying to make the pie bigger for everyone by catalyzing the market. There's unprecedented interest. Really, in a very concrete way, it's a conversation everyone wants to have, and everyone knows it's going to be a problem. But I think the market, in terms of actually allocating budget to build the secure agentic enterprise, is being hamstrung by the confusion. Customers, they don't want to make the wrong decision, and we've been successful with Okta for AI Agents. It's off to a great start. It's growing incredibly fast. But that's because we've positioned it as this really no regrets foundation.
Basically, we go to customers, and we say, "However this unfolds over the next five or 10 years, you're going to have to have a secure way to connect things together." Token, that's not going away. In fact, it's been around for a while. You've had to connect software together. And it's only going to get supercharged in terms of that requirement. So you need to manage tokens, you need to have this registry, and that's worked. But to really take the market to the potential we think it can be, and let's be clear, we think the identity foundations of the Blueprint, it could be a bigger market than all of IAM. And IAM is one of the biggest markets in cyber already. I believe IAM will be the biggest market in cyber in five years. That's pretty clear to me that's going to happen.
Agentic could be bigger than it all. The agentic, the security and governance and visibility for agentic, being the control layer for that, could be bigger than all of identity is today. Now, how do we make that happen? We have to bring this clarity, and we have to make sure customers can get help, and the industry can help customers understand how to rationalize this all and put things in buckets. Of course, there is going to be debates and skirmishes at the margin. It is not like I am sure that other companies have an opinion on they should do this identity part, and that is fine.
By and large, we are going to clarify what the gateway should do, what is the difference between an AI gateway and a MCP gateway, and how those work together, and what risk means across those kind of things can be clarified and catalyze the market, and that is the point of the Blueprint . The Blueprint members, it has only been six months or so we have been working on this in serious, dedicated budget and effort, and it is going well. The proof is in the pudding. The alliance members have to keep working together, certify their products as the technology evolves, but I am very optimistic about it. The strategic objective here is, let us be clear, is bring clarity and make the pie bigger for everyone. I think we have a good shot of doing that.
Like I said, I am super motivated and fired up to meet this need and move the industry forward because, yeah, the downside scenario is fragmented approaches, not good governance, not good risk management, and not getting where we need to be as an industry.
Hey, thanks. Brian Essex from JP Morgan. Hey, Todd.
Hey, Brian.
We caught up really briefly, and you asked me one of the things that I thought was impressive, my reply was, the third-party IdP access.
Yeah, third-party IdP.
Integration. Yeah.
Sacrilege in the past.
Would love to hear the backdrop for that. How many deals, when you've been selling Okta Agentic Identity Platform, how many of those conversations maybe had a bottleneck because a competitor of yours was in the IAM business with that customer? How much do you think this would accelerate market adoption of your agentic platform?
Yeah, I can start, and Ric, you can chime in here. You've been super close to this. By the way, Okta has a secret weapon here in my friend Ric Smith. He's been here one year.
You got it.
Making a huge difference accelerating our R&D. The access management for employees, the market share is pretty stable. Microsoft has about 40%, Okta has about 30%, and then there's some smaller players and a lot of niche players, I would say below that. The whole market's growing, so that's good. Okta for AI Agents is a GA product. We're the only one with a GA product, which is a great position to be in. We're innovating quickly. That's a lot of customers out there that have a Microsoft IdP. They're coming to us, particularly the big ones, big global deployments, multinational. I'm thinking of a multinational auto manufacturing company. I'm thinking of two or three other very large accounts that see this as a big problem in their Entra ID IdP shops. They want to use Okta for AI Agents, which is exciting.
I would say the vast majority still of our conversations about Okta for AI Agents are people with the Okta IdP, for sure. Particularly in the largest of the large enterprise, which is an overall area of strength for Okta in general in the last year or two. The fact that we're supporting IdPs outside of Okta is very compelling. That's exciting. The other exciting thing is that we're seeing that I can think of two or three specific cases, one's with a software company, 35-year-old software company. A couple other ones come to mind where they're actually, you can't replace Entra ID because it's the login for Microsoft 365. But the Okta for AI Agents product is actually pulling in the whole platform. They know AI is a big deal.
They've been not happy with Microsoft because it's not really great at connecting with non-Microsoft technologies, and this has been the thing to get them over the edge of going in on the whole platform, governance, privilege, Okta for AI Agents, and Workforce Identity. Those two I'm thinking of actually have a big CIAM, a customer identity expansion as well. It's catalyzing the platform, that's like big-time upside scenario for Okta. We win the agentic identity market. It pulls through the rest of the platform in a way that changes the market share dynamics overall. It's super exciting.
I think you stated it very accurately. Most of our conversations that we have actually start on the AI front, and then that leads to a larger platform sale. Most of that is the result of the customer having a clear understanding that it's time to actually evolve their identity platform in order to be able to handle what's happening in the agentic world. In terms of us being able to connect to another IdP, it is early days in terms of that kind of opportunity. We're seeing more and more demand for that, and it's not just unique to what's happening with Okta for AI.
We're seeing it across all the products, and we have a motion to actually start opening up governance, PAM, as well as the Auth0 platform so that we can attach to an independent IdP other than Okta, so that we can use that as a land and expand opportunity for the platform.
One other thing I'd say on that is, this is really where specialization in go-to-market is helping. We made a move to specialize how we go to market in the field with our customers, with deep domain expertise in kind of three product areas. So we have a takeoff team for AI, deep subject matter experts on Okta for AI Agents and our AI solutions. They're often opening the door, and those doors lead in different directions. Like Ric said, it really is creating the opportunity for broad platform modernization across all identity use cases and for identity types. That leads us to the CIO and the CISO, where we have the Okta specialist team, but it also leads us to external-facing applications and Auth0.
We see many examples now where the AI conversation is opening the door to a much broader opportunity for Okta, and it's going across both the Okta and Auth0 platforms in all of their forms. The go-to-market structure that we've had in place now for 18 months is really helping elevate that.
Join me in congratulating my friend here for five years at Okta.
Thank you, Todd.
Congratulations, Jon. Jon, when I first met Jon, I was interviewing him for the GM of EMEA role, and I just want to thank you for making my promotion decisions look smart.
Number one role in life, make the boss look smart.
Never fails.
Thank you. Eric Heath from KeyBanc.
Yeah.
I think one of the things you said, Todd, and I totally appreciate, there is a lot of noise. It is hard for the CISOs to cut through the noise and understand all the different technologies and who is differentiated, and everybody has got their own story and they are all telling the same story, essentially. Long-winded way, I guess, of saying, you do have some platform vendors that have gotten into identity, and they tell a similar story in that they are trying to secure identity for agents as well. How are you seeing them show up, if at all, the larger platform vendors? Secondarily, is the bundling effect, what they can do with flex pricing and platformization, having any impact, or do you foresee it having any impact to selling Okta for AI agents?
I think it is going to play out. I think the market share established over the next three years for the agent, call it the system of record for agent identities, it is going to play out over the next three years. There is going to be massive growth and the market share is going to be set probably in three years. So there is going to be competition. People are waking up to this after many, many years, that identity is going to be the biggest part of cyber and that the agentic control plane might be a bigger market than all of that together. Because really you are talking about the control plane or at least some foundational pieces of the blueprint for all of technology. Because everything is becoming agentic.
When we talk about the agentic, the blueprint for the secure agentic enterprise, we are talking about the blueprint for all of security. That is why it takes a village. It is not going to be Okta out there all alone, securing everything. It is just not going to happen. There is too much technology, and there are too many pieces that have to come together to make it happen. But I do think the market share is going to be set over the next three years for agentic identity, and we are very focused on winning that.
It is all systems go to win that. I think we have a lead. It is very early, but our advantages are, it echoes with what we have been talking about for many years. We are not trying to sell a model. We are not trying to sell a broad development platform.
Some people will want to go all in, and they will be constrained and hamstrung by that. But the vast majority of people, especially in this fast-evolving, somewhat confusing environment of agentic and rebuilding their company and their infrastructure, they like the choice. They like the flexibility. I like our position, and there is not another company that has that focus on identity, and if we do our job right in laying the landscape in a way that people are clear on how the blueprint parts have to work together and how in those different pillars of the blueprint, how identity plays such a relevant role, I like our chances. But the market share is not decided yet. It is too early. We have to go out and win it, and we are making sure we build the company and the culture and the environment to win it.
That is why everything at Okta is ramping up. The intensity, the expectations, the standards. We are not going to lose this. I am totally dedicated to winning this, and I like our chances.
Great. Thank you very much. Gray Powell with Deutsche Bank.
Hey, Gray. Nice to see you.
Nice to see you too. I just had a question on the buying center, particularly related to Okta for AI Agents. For better or worse, security or identity historically is just viewed as like a tax on the business versus something that enables business. Do you see the buying center changing with AI? Is it more closely aligned with something like a marketing budget or something that could generate revenue versus traditional security budget dollars?
Yeah. We've faced this challenge for some time, just relating to identity. Broadly speaking now, identity management is a topic where we need to address the needs of people who are building technology to compete and sell goods and services. Also, clearly it's of high relevance to CIOs and CISOs and the SOC. For some time we've been working really hard to make sure that we've got the right team in place to specifically address those needs. We don't really see that playing out much more differently when we think about agentic security. The agentic security topic, and it's clear understanding as we're seeing it in our customer base, that to solve it, they see agents as a primary identity type.
That's a natural evolutionary step in the relationship capital that we've built over 17 years in our customer base. Now, it means that we've got to be tight with our customers across a really broad set of stakeholders. It means in really big companies, we've got to be aligned internationally so that we understand their strategies. We're ahead of the curve when we're thinking about securing all of their external-facing apps or their resources to humans, non-humans, and agents in the future. There's a lot of work to be done, especially in enterprise and strategic customers. But I feel really good about our positioning, the relationships that we've built over time, and we're seeing budgets typically come out of our traditional stakeholder groups. So CIO, CISO budgets.
We're seeing a lot of new program spend, and increasingly, we're seeing budget come out of R&D and engineering, especially for things like building external-facing agents.
Yeah, I think you'll see an evolution over the next year. From, I'd say, 80% of the conversations I have are with IT or security, Gray. So, traditional buyers. But I see a big trend changing. You're going to get more like the traditional customer identity business, where it's like marketing chief digital officer. You're seeing that start to happen more and more. I was meeting with one of the major airlines recently, and at the table were their, basically it's their kind of chief digital officer, which is business-driven. They want growth. It's a loyalty program growth, more ROI on the loyalty program. Then you saw, then the chief security officer was more of traditional risk management, lock down internal systems. You could tell that conversations are going to evolve that way. There's going to be more of that, what typically would've been like the CIAM buyer.
I think we've done a good job leveraging our relationships with IT and security and the Workforce Identity Foundation, and getting Okta for AI Agents off the ground and rolling there. I think you'll see a similar thing on the customer identity side, but I think it makes sense, right? I think people are starting with their internal processes. Maybe the risk is lower there. They don't want to mess up the customer-facing experience. You don't want to mess up your loyalty program, as an airline, but, that's the trend I see.
Thanks for taking the question. Rich Poland from Wells Fargo. So Todd, I think today on stage you were talking a lot about the agentic commerce opportunity and the productization there with Auth0. I just wanted to put a finer point on that given recent events with Muse and Instinct.
Feels like that could be meaning.
Super interesting. Yeah. I feel like I'm a broken record here, but I think there is a big opportunity for more standardization there. All these products like Instinct and Muse and OpenCloud and the other ones, it's pretty rudimentary . It's like, "Type in your password and I'll use your password." I think we need a better solution. It's like if you're building a customer-facing app, for many years a bot was bad. Bots where you'd want to shut them down, and you didn't want bots taking the tickets and scalping them, and bots were blocked, and we have a whole capability to block bots. Now bots are good.
Unless you're worried about, like Amazon is, you're worried about your Amazon credentials being out there and losing control, and someone hacks into one of these Muse or one of these things and buys $5 million worth of Amazon stuff, Amazon's going to be responsible. I think we need better standards. I think the industry has to evolve, and I think as the Blueprint expands, it'll start to cover more and more customer facing. If we do our jobs right, it could start to cover more and more customer-facing scenarios. But, yeah, it's still early days, especially on the customer-facing side.
I would add, most of our customers, particularly in the CIAM business, they're starting to see a drift in traffic. Traditional digital properties are in decline in terms of the traffic they see as a result of more and more consumers going through agents. The standards in place like UCP are very early, so there's not broad adoption, not a lot of interoperability. But every one of our customers sees that pull, and that's why we're partnered with Google to go out there and try to open up that lane for them. To the earlier question regarding are we seeing more traction revenue opportunities or helping guide our customers on revenue opportunities, beyond just agentic, they're actually coming to us and trying to find paths that they can look at the login process as part of the conversion process.
If you end up in the Auth0 platform keynote, you'll be seeing a presentation around Conversion Suite, which offers that opportunity and affordance to our customers.
Hey, Joshua Tilton, Wolfe Research.
Hey, Josh.
Thanks for taking my question. Hey, Todd. Todd, I want to go back to something you said when you started. You used the words, "We're lucky for where we're positioned in the industry." Can you maybe, in the context of that, compare the demand and the adoption curve that you're seeing for your Okta for AI Agents offering, to what you saw during COVID and the demand and adoption curve when I could argue you were just as lucky for your position in the market at that time?
Yeah, COVID was definitely a catalyst. I would say it was like the big final push of the multiyear secular shift to being the perimeter is not the network. You really have to have a strong identity foundation. Like I said, I don't think it was, in terms of shift in industry, it was like a culmination of that shift. After COVID and zero interest rates last three or four years, we've all been trying to figure out what's the next big catalyst. We found it, which is very exciting. It's hard to compare. It was such a weird time in COVID, and everyone was trying to adjust and so forth, but this one feels way bigger to me. It's not the final push of a multiyear thing. This feels like something new.
Not new in the sense that it is totally disconnected from what we have done before, but the energy and the potential feels much bigger.
Hi, good afternoon or good morning. Fatima Boolani from Citi. Thank you for taking.
You are still in New York
I know, still on New York time. I appreciate you taking the questions.
Yes.
I have one for Todd, and I am going to sneak one in for Ric as well, if possible. Todd, just on the Blueprint Alliance, the spirit of the effort is very clear, the ethos is clear, but can you maybe expound on what the next phase of the Blueprint Alliance is going to be outside of building more consortium and.
Yeah.
More vendor inclusion? Ultimately what I am trying to ask is that, should we expect the next phase of that alliance to include economic incentives whereby Jon can go to customers and have joint go-to-market incentive agreements with a CrowdStrike or a Zscaler, where ultimately you are getting paid for building a coalition around this effort and.
Yeah.
I will follow up for Ric.
No, it is a really smart question. Kind of follow the money. This is very important to us, and the next phase, I think is, it has to catch on with customers. Meaning customers have to accept it and make it clear to everyone involved on the vendor side that they want this and that it. If it does not get that kind of traction, it is not going to be super successful. So customer adoption and customer endorsement is super important. That is the only thing that I have been working at enterprise companies for a long time, and the one thing that really is powerful is customers requesting things. So that is really important. Then I think the next. We have a really good version of the white paper that I am very proud of.
The next step is really working with alliance partners to check the reference architecture that the products are working together. It will just be a good virtuous cycle with customers endorsing it and know they are seeing results, that the products are working together, and tangible evidence of the clarity versus the conclusion. I think those are two very important steps. In terms of the economic incentives, I think those are interesting, but probably premature now until we get those two steps. The one thing I will say is that, we are talking Blueprint, which is very high level industry landscape type stuff, and then we talk about this Agent SSO. That is like we went macro and now we are going to micro. Agent SSO is, we have been working on this for four years. It is perfect for agents. They all need it.
It has got a ton of traction, a ton of momentum. In terms of incentive, the reason why we are enabling Cross App Access support in every Okta product is because we have to catalyze the ecosystem. We have to give these ISVs a reason to support it. They all have 50 things to do. They are all working about on AI agents and doing this stuff, and they have to have an incentive. The incentive is going to be customers ask for it. If customers have one of the most popular AI agents in Claude, like they do, speak in this protocol, and it is in every Okta product.
We cannot go to an ISV and say, "Hey, support Cross App Access is an open protocol." The first thing they ask is, "Okay, how many customers can use it?" The answer that used to be like, "Well, I am not sure." But now the answer is very clear. Every Okta customer, and by the way, every Ping customer, because they support it, which is awesome, and every customer that uses Claude. So that number is big. When we talk over the next six months or a year, the question you used to ask me is, "How many ISVs supporting Cross App Access?" That number better grow. If that number is growing, you could get confidence in this micro standardization effort, and if you get confidence in this micro standardization effort, you should have more confidence in the macro effort, too.
Ric, just really quickly for you. You are spoiled for choice in terms of where you can invest the R&D envelope. Clearly, the velocity of the portfolio expansion has picked up. How should we think about where you are kind of putting your chips and, I am coming from the standpoint of the earlier question on if we see a massive explosion on consumer AI interfaces and in B2C use cases, there is a completely different technology investment strategy behind that. So how do you kind of think about allocation of your R&D capital behind those opportunities?
We're pretty financially aligned in R&D, so when we groom the portfolio, we're looking at like, what are the major drivers in terms of current revenue? What are the bigger bets down the line? We have no fear of moving resources, even if we have to cross the lines between the different platforms. We're here to win, and that's the only way to win.
Yeah. One thing I want to be clear on, everyone. We combined Auth0 and Okta R&D, so it all works for Ric now. He can move pieces around, make sure the investment across the entire portfolio is aligned on the biggest impact things. I think it's a great thing. It's really helped Okta for AI Agents and the gateway and so forth.
Thanks. Saket Kalia at Barclays. Thanks so much for hosting the session. Jon, maybe for you, I want to change it up a little bit. I'd love to talk about some of the observations that you have from specializing the sales force. It seems like it's been a great success based on some of the metrics. But maybe outside of the agentic opportunity, which we.
Yeah.
Are all clearly excited about. Do you still feel like there's low-hanging fruit for better execution just in the core Workforce and Auth0 businesses? Does that make sense?
Indeed. I think the momentum, the durability of our core business is really strong. It is a really big part of the success we have had this half. A large part of that is the improvements and the accelerated benefits of sales productivity. For 18 months, we have had a very stable operating model in go-to-market. It has benefited from specialization, like I said, in several forms.
We specialized it around our public sector opportunity. We have specialized in commercial and down segment around specific customer need, around new logo acquisition, and install base and account management, and like I said, in platform specialization up above that for enterprise and strategic. It is super clear that when we think about specialization and, obviously, many companies at our phase and our stage with this broad range of product capability and demand that solve specific problems for customers and our stakeholders that we manage. There are various choices around how you specialize, and we take our North Star from what is it that the customer needs?
What is it the customer needs to be successful in the thought leadership, relationship capital, technical expertise, and partner ecosystems so that they can invest in the Okta and Auth0 platforms and think about them really as generational strategic bets over the long term.
That is how we think about specialization. If you look at all of the incredible innovation that we have built in and around the Auth0 and Okta platforms over years, they are very broad platforms. They have a lot of use cases covered. They require a lot of specificity, a lot of understanding about the competitive landscape, the buying processes of stakeholders. When they think about those platforms, the different identity use cases change. So it does require learning, and our tenure in sales is very high. Like I said, AA productivity is very strong and our attrition is low, and so we are getting the benefit from that.
When we think about the future, we feel about shifts in those areas carefully and prudently, and we really think right now we are on the right path in the structure and the team, the capacity we have got, and how it is yielding in pipeline and sales productivity.
Shrenik Kothari from Baird. Todd, on the keynote, you pretty much highlighted why you made the Agent SSO available to everyone, and clearly, as you just highlighted, it's a frictionless on-ramp for customers to adopt more. I just wanted to connect the dots here a little bit, since you already have several dozen customers who are already using Okta for AI Agents, and you mentioned in the keynote that first step is the connection point, and then if you need more complex use cases, requirements for governance and runtime enforcement. Just curious in terms of the monetization journey for the customers on Okta for AI Agents, how is that progressing? Yeah.
I was meeting with a large, well-known insurance company, and they're an Okta customer. They use Okta for customer identity and Workforce Identity. The conversation was all around Cross App Access, and they're very excited about Claude supporting it. They're very excited about a bunch of their applications supporting it, and so they want to understand that. They were super excited about just being able to do that in their environment. They have Agent SSO, which means that they can start using the Okta directory of agents. They can start doing Cross App Access, and they're very excited about that, and it was two meetings and one-week POC when they realized that they needed full life cycle. They needed support for connections that weren't Cross App Access, and it's a full upgrade to Okta for AI Agents. I was really excited about that because that's our strategy.
It's like seed the opportunity with Cross App Access, deliver value with that, but also deliver value and monetize the value with Okta for AI Agents, which is why when you put it all together too, you kind of see why third-party IdP support is important. Even if it's a company that doesn't use, like this large auto manufacturer I was talking about, they don't use Okta for their IdP, but we could run the same play there. Cross App Access, upgrade to Okta for AI Agents. Yeah, like I said, we're in a good position. Still early, we have a lot of work to do, but the strategy and the tactics are, we're seeing early evidence that they're playing out quite nicely.
Great. Steve Koenig with Macquarie.
Thanks.
Thanks for doing the Q&A.
Yeah, sure.
I am wondering, Todd, question probably for you or anyone else that wants to comment. Given the early state of agentic identity and agentic governance, and you are one of the few vendors with a GA product out there, how is this impacting customers' efforts to adopt agentic AI more broadly, and where are you seeing, if you were to think about the use cases that are driving customers to consider Okta for AI Agents, what sorts of agentic use cases are priority for them, and where are they, in some cases, holding back on adopting agentic technology because of this early state of the controls technology?
I think it is a really good question. Any of our customers for Okta for AI Agents, I do not think we have introduced them to the concept of agents. I think these are companies that have been on the path. You look at Ramp or Yahoo or Dell, or internally, our own example. These companies see the potential and are on the journey. Either they are heavily invested in platforms that are offering agentic capabilities, or they are building their own. The need kind of smacks them in the face, and we are there to service that need. I think if you just think about it as an adoption curve, these would be called early adopters, I think. But we are trying to make the pie bigger by codifying and clarifying how things fit together with the Blueprint and trying to really hasten the big part of this bell curve of adoption.
Because it's coming, right? Every company that's going to be successful is going to. It almost loses meaning because saying they're going to be agentic, it's the same thing as saying they're going to adopt the future of technology. It's going to happen. It's just a matter of how long, and the reality is it's probably going to be longer than we all think. But it's probably going to be bigger than we all think. Yeah. It's super motivating.
Thanks for doing this. Mike Cikos with Needham. Two questions. First, on the AI monetization, can we talk about where we are in terms of price discovery, and what is the market willing to bear in terms of valuing an agent?
Yeah. This is a really important thing we think about a lot. Right now, our pricing for Okta for AI Agents is per user, which sounds weird. It's for agents, why would it be per user? If you got a chance to check out the keynote today, we're a pretty pragmatic company. We want to meet customers where they are. And this is like the previous answer, where these companies are adopting AI agent solutions, but they're really helping a user and making a user more productive. And the flows all kind of start for a user, whether it's the Dell example where it's the AI system is in the interaction of a customer service or support person, is figuring out based on the AI model, the next best action.
A lot of the use cases are tied to a user, so it kind of makes sense for someone like Dell or Ramp or Yahoo, or the many other customers where they say, "Hey, I want to pay for this per user." And it's basically an uplift of the per user price. And we're seeing, using round numbers obviously, but I can think of sizable deals that have been, if the overall platform or Okta is four, the AI agent part is one or 1.5. So it's a significant part of uplift for the whole suite. And that's exciting, but I think this is going to evolve. This pricing model is going to evolve, and it's not going to be per user. There's going to be something else. It's going to be per agent.
That is problematic now because there is not a standard way on how you count agents. By the way, it is something we can add to the Blueprint, a systematic way to count them. It sounds simple, but it is going to really benefit customers because right now the problem with counting is that if you have an agent like our internal agent called Dex, is that one agent or is that 7,000 agents? Because that is how many people use it. And of course, if you are paying by the agent, you want that to be one. If you are charging by the agent, you want that to be 7,000. The industry will figure it out. I think a big impetus will be the longer running agentic workflows get, the more autonomous workflows get, the less coupled they will be to a user session, and that will really force us all to figure this out.
But we will figure it out, and the value we are adding and the value the Blueprint is adding, like I said, I am not worried about monetizing this. I think this opportunity could be bigger than all of identity in the fullness of time. We will get there.
Maybe for a quick follow-up, I would just love to ask Jon, go to market. On this point, it feels like each touchpoint by default has to be more bespoke to help each customer on their journey. And I would just be interested, what are the additional resources you are putting behind this to help customers onboard?
There are two or three things I would say on that. We prepared for this year, really waiting for the moment, and it gave us an opportunity to reconsider our sales methodology and go to market. The structures that we have got in place to create a framework for how we go into the market with thought leadership around AI, we completely rebooted our sales methodology at the beginning of this year, specifically for that purpose. Secondary to that is we want go-to-market folks to come to Okta, and it be the best experience for them, not only in terms of making them identity experts, but also fusing how they go to market with AI tools.
We have spent a lot of time and effort and investment giving them amazing tools, where when they are showing up with customers, they have the right information that is specific to the use case, it is specific to the industry, it is highly relevant to really the innovation that is coming very quickly out of R&D to really give them the tools to excel, differentiate themselves, and meet customers where they are. The third piece on this is, you are right, each customer use case is bespoke. It is highly specific to where they are on their maturity curve with agents. An incredible part of that is preparing ourselves with thought leaders around those customers who work with them for years on their own technology strategy. For that, we have to rely on our partner ecosystem.
We have spent a lot of time and effort with our partners, educating them on this massive opportunity, but really preparing them to bring their specific thought leadership about the company in question to bear as they engage with us, with our expertise around AI security. That is really playing out. We had an incredible partner summit yesterday. Some of the performance from our consulting partners, the advisory firms, the companies we are working with in enterprise and strategic, it is paying massive dividend. When we look at the performance of our big deal cohort, really big part of our growth story in H1, I look at all those deals. Our top 20 deals in Q2, they were sold side by side with partners co-selling with us. Our biggest deal in Q2 was partner sourced.
A massive part of that is being there toe-to-toe with our partners, providing advice, technical expertise that is relevant to their bespoke agentic use cases.
Hi, it is Gregg Moskowitz from Mizuho. I have a bit of a follow-up on Agent SSO. It has been GA for a month, and the demo you showed this morning was pretty slick. What I am wondering, though, is how much of an on-ramp for Okta for AI Agents do you think that this can be? From a go-to-market standpoint, are there any strategies or mechanisms that you might be able to put in place to get a healthy percentage of customers to matriculate from Agent SSO to Okta for AI Agents going forward?
Yeah, you can almost think of it as a very clear analytical dashboard that we can use for pipeline. We know all the customers that are onboarding onto it, that can be fed to Jon, and his team can engage. Honestly, you don't really have to wait for that. It becomes pretty obvious in terms of all the features and functions that you need to manage the agent lifecycle once you're onboarded to it. But it does give them the first litmus test of understanding of what is the experience as a result of not having to do all these consent-based prompts through Claude console or what have you.
It was interesting internal, the debate about should we make the Cross App Access capability, add it to every product at Okta, and make it widespread. It was interesting debate. The debate against doing that was, "Oh, we don't want to give it away. We could charge for it. We can monetize it." The argument for doing it was obviously the pushing the Cross App Access standard, giving an answer to these ISVs when they ask how many people could do this. The answer is all of them. That's compelling. But the other point is, listen, we're pouring all this energy and innovation into Okta for AI Agents, and you can't build enough value around the blueprint and all the problems there to solve that you can't get them an upsell. It's like, really? Come on, guys. You've got to work harder.
The result was clear that we do have compelling value in Okta for AI Agents way above the Cross App Access and the stuff that, and the directory entries, and the capabilities there. I think we're going to be pretty happy with that decision.
Yeah, it's going to take a lot of effort and focus and momentum to get Cross App Access adopted broadly in the market and the ecosystem, and a major part of how we're going to be tracking customer success moving forward. We obviously have a set of customer health metrics that we measure in every kind of standard. It's like CSM motion and how we think about Agent SSO is going to form part of the consistent evaluation of the value that we're adding across all forms of how they're being successful with their stack.
Yun Kim, Loop Capital. Just following up on Mike's question around go-to-market on Okta for AI Agents. How heavily are the partners involved in the initial go-to-market? Because obviously we hear a lot of good things about the pipeline from the earnings calls. How are those generated, of that size? Also just walking the floor for a few minutes before I came in here, did pick up signs that maybe there is a greater services component related to Okta for AI Agents, maybe almost 2x to 3x versus your single sign-on. Does that change the way that you do your go-to-market, and you got to tie into services to make sure that you are engaging the prospects properly?
It is going to take a huge amount of collaboration in the industry to get our customers to be successful with AI security. That is really obvious. Just in the last, I would say year, 18 months, we have really expanded the amount of effort that we have put into forging these technology partnerships that are going to surround our customers. All of the customers are going to be meaningful to our growth. As Todd said earlier, they have deeply heterogeneous operating environments. They are looking to us as an independent and neutral identity provider with 17 years of integrations behind them to come in and help make this solution work very quickly for them.
It is going to require a very broad effort in long-term deployment, not just around Okta for AI Agents, but as Ric talked about, what we are seeing is the AI conversation is triggering a broadening effect as companies think about modernizing their identity infrastructures for all types of human, non-human, and agentic identity types. We have to, in our motion, we plan out that breadth of capability, the pull for a number of products that are in our new product category that put in place what we call an identity security fabric. A lot of these products, they are requiring consolidation, replacement of often many point solutions, and significant amount of services effort.
In order to do that, we face the reality that for us to be successful, we need to surround our customers with a number of service delivery capabilities in our partner ecosystem that are specialized, that are experienced, they are enabled, and we have invested in, and we have invested significantly in those capabilities. We are getting great feedback from our partner community in and around that. Their ability to go and deploy our products, broaden out the identity security fabrics that are a key part of the Blueprint Alliance and our customers' long-term strategies for identity, that is a critical part of our engagement, our selection, and our investment in the partner ecosystem.
Hi, Todd.
Nice to see you, Rob.
Rob Owens in Piper. Good to see you as well.
Yeah.
I appreciate the complexity of what you guys are trying to do around agentic, contemplating access, governance, and the like. How do you think about the data side of the equation? I know it's going to take a village, but there is a natural convergence when I think about what an agent has access to and then regulating what type of data it's going to have access to.
I think it.
How do you contemplate this longer term?
Yeah. I think data security and data governance is a big opportunity. I think it's pretty nascent and immature right now. I think a lot of enterprises don't have a good handle around it. It is a pretty identity-centric problem. So our strategy is, again, repeating myself a little bit, but we're trying to build the one-stop shop for identity. We're not trying to branch off into a bunch of other security categories. We're keeping our independence and neutrality, and we're trying to build the best, take our $600 million of R&D and invest it in the best identity stack, the identity platform. The pitch to customers is consolidate on us. Then the second opportunity is this agentic, being the system of record for the future of agentic, which is really the future of technology and playing our part in the blueprint.
So those are the two big things we're doing. When we think about strategy on the first one, it's like, okay, what is identity and what is not? There's a lot of things that are either some of them are clearly identity, and then there's things that are adjacent, and we're thinking through what's the right way to build, buy, and partner there. I think this identity area is super interesting. The current solutions there aren't great. Yeah, it's something we think about a lot, and I don't think there's a good answer yet.
Hi, Nasr Islam here for Brad Zelnick at Deutsche Bank. Todd, touching on the four pillars outlined in the blueprint, if you look at other security markets, we have often seen value migrate towards runtime enforcement and response, while discovery and posture management capabilities have become increasingly commoditized over time. As the agentic identity market develops, do you think the same dynamic could emerge here? And where do you believe the most durable sources of differentiation will ultimately reside?
That is a good question. I think that would be a fair bet, that the value will accrue at the same layers. But we are keeping our mind open. And we are trying not to be too smart for our own good. We want to listen to customers and provide the value that they are asking for. You have to have a strategic view, and you have to bring your own opinions, but we are pretty good at listening to what the market wants us to build and building it quickly. The last thing that comes to mind there is that the opportunity is big. Spending time trying to think through what layer of the architecture is going to be monetized the most, might not be super productive.
If we just focus on what customers need, how value is going to be delivered, working with the people in the ecosystem to build the right thing, and then delivering great capabilities, I think that is the winning solution.
Rudy Kessinger, D.A. Davidson. A lot of your cybersecurity peers have seen a lot of success with the flex pricing model. Given the uncertainty around agents and how many we might have in six months or a year as a customer, I guess, is that a model that you guys have considered utilizing as well?
We have customers on flex agreements and enterprise bundles. Clearly, as the portfolio breadth has expanded and we're dealing with very complex customers, lots of different subsidiaries moving at different speeds with very broad use cases, there's clear commercial value to them of having agreements that give them economies of scale and flexibility. That's a path that we're down. I think that it's a path we're going to continue with, and it's exciting that customers are leaning in so broadly with us and are interested in those types of opportunities.
Every company that gets to $3 billion in revenue and has aspirations to accelerate growth like we do, they're going to do some version of bundling or platform. Ours is the identity is the bundle, is the platform. We're definitely doing bundling, and we're going to do more of it and flex agreements. We're going to do all that stuff. You're all very studied in all this, but the bundle economics are more compelling, and they work better the more hit products you have. One of the most exciting things about Okta for AI Agents is it looks like it's going to be a hit product, which is going to reinforce the value of the broad platform, make the bundle more compelling, stickier, move the rest of the product. It has big potential to move the business on all those dimensions.
Here we go. five minutes left.
Hey, it's Taz Koujalgi from Roth Capital. Just a clarification on the comment that you made earlier about pricing and uplift, Todd. You said if the Okta Platform spend is four, Okta for AI Agents spend is about 1.5, that would imply about 50% uplift. Did I hear you correctly? Because I think when you launched OIG, you had said that the uplift that you're getting from OIG is about 30%. It looks like the Okta for AI Agents uplift could be even more than OIG.
I think that's right. Yeah. It's not a set of thousands of deals yet, so it's a small sample size. I'm just thinking of the few specific sizable deals in my mind, and that's how the numbers are fleshing out. It's maybe similar or a little bit more to the OIG attach, which is pretty exciting.
Hey, thank you. This is Lawrence Vensko here for John DiFucci from Guggenheim Securities. We've talked a lot about the enterprise today and the opportunity there, but you've also invested a lot into the public sector, and you recently brought agent governance into the FedRAMP High environments. Considering your commentary around the pipeline and Okta for AI Agents, is the public sector pipeline today mostly Okta agencies adding agents to their environments, or is it new agency opportunities? Thank you.
It's still, I'd say, pretty early days in terms of agentic deployments in public sector. The public sector performance, generally speaking, has been very strong through the course of this year. That's down to, like you said, a lot of our investments in our regulated environments and, most recently, FedRAMP High and IL5. Yeah, we're continuing to see great representation in our top deals from the public sector, domestically and abroad. So yeah, we're excited about it. We're excited that we've got the right regulatory controls in place, the right environments for public sector customers, and I think that as they start to explore their own agentic use cases, we're going to be in a great position because of that.
Yeah, I think if you do take a broad survey, I think public sector is maybe trailing, particularly on adoption of agentic. Some of the biggest opportunities in the pipeline we're working on, even at this conference, are with massive government agencies that want to do Okta for AI Agents. They're doing pilots and prototypes. I just had a meeting yesterday with one of the leaders with this organization, and it's all about making sure all of the pieces of the platform have the right compliance so they can deploy it in their environment. So I think it's coming. Especially, I think it's some of the larger organizations that see a lot of potential and can move effectively quickly in here to get some of the benefits. It's pretty exciting.
Time for one more. Are we good?
That is shocking.
Yes, always have one more question.
Really?
All right. We will wrap it up there. Really appreciate you guys coming out to Las Vegas. We know your time is valuable. If you scan the QR code here, it will download a four-page summary of all the innovation announcements that we have this week at Oktane. Thanks again for coming out.
Yeah, thanks for your support. I read a lot of your research, not only on Okta, but on everything else, and you guys do good work, and I learn a lot from your research, so I really appreciate it.
Thank you.