Shares of Okta Inc. (OKTA) surged 5.29% in after-hours trading on Tuesday following the release of the company's second-quarter fiscal 2026 financial results that exceeded analyst expectations. The identity and access management firm reported strong earnings, revenue growth, and raised its full-year guidance.

For the quarter ended July 31, Okta posted adjusted earnings of $0.91 per share, significantly beating the analyst consensus estimate of $0.84. Revenue climbed 13% year-over-year to $728 million, surpassing Wall Street's forecast of $711.8 million. The company's subscription revenue, a key metric, rose to $711 million.

Okta's CEO, Todd McKinnon, attributed the solid performance to "continued strength in new product adoption, the public sector, Auth0 and cash flow." The company highlighted that five of its top ten customer wins came from the public sector, including a Department of Defense agency. In light of the strong results, Okta raised its fiscal 2026 outlook, now expecting revenue between $2.88 billion and $2.89 billion, up from its previous guidance of $2.85 billion to $2.86 billion. The company also increased its full-year adjusted earnings forecast to $3.33 to $3.38 per share.

Adding to the positive sentiment, Okta announced the acquisition of Axiom Security, an identity-centric privileged access management platform. This strategic move aims to enhance Okta's capabilities in securing sensitive resources, particularly as enterprises increasingly incorporate AI into their operations. The acquisition is expected to strengthen Okta's position in the growing identity and access management market.