Okta Inc (OKTA)

Short-term

Turnover ratios

The activity ratios of Okta Inc. from the provided data reveal several key insights into the company's operational efficiency over the specified period.

Inventory Turnover:
Historically, Okta's inventory turnover data is unavailable for most periods until the latest measurements in 2023. Starting from January 31, 2023, the inventory turnover ratio stabilizes around 5.6 to 5.9 times, indicating that the company is efficiently managing its inventory by turning it over approximately five to six times annually. The consistent values suggest a steady inventory management strategy during this recent period.

Receivables Turnover:
The receivables turnover ratio demonstrates significant fluctuation over the analyzed timeline. In early 2020, the ratio ranged around 6.37 to 5.51, decreasing markedly in subsequent periods to as low as 3.27 on January 31, 2022, before sharply rising again in 2023. Notably, in April 2023, the ratio peaks at 6.76, indicating an improvement in collection efficiency, while other periods show moderate to low collection speeds. The fluctuations suggest variability in the company's credit policies or customer payment behaviors over time, with a recent rebound in collection efficiency.

Payables Turnover:
The payables turnover ratios display considerable volatility. In the initial periods, such as July and October 2020, the ratio remains high around 39 to 39.35, reflecting prompt payment to suppliers. From January 2021 onward, the ratio drops significantly, reaching as low as 10.71 in October 2022, which implies longer payment periods or more extended credit terms. Conversely, periods like April and July 2023 show elevated ratios (up to 55.68 and 53.91, respectively), indicating shorter payment cycles or a strategy to settle liabilities more quickly at those times. Overall, the company exhibits variable payables management, potentially adjusting payment policies based on strategic or operational considerations.

Working Capital Turnover:
This ratio illustrates a general trend of increasing efficiency in managing working capital. Starting from 0.32 in July 2020, the ratio rises gradually, reaching approximately 3.47 by January 2025. The ascending trend indicates that Okta is generating higher sales relative to its working capital investment over time, reflecting improved operational leverage and efficient utilization of short-term assets and liabilities. The notable uptick starting around late 2022 suggests a strategic shift toward more effective working capital management.

Summary:
Overall, Okta's activity ratios indicate a company that is refining its operational efficiency. Inventory management appears stable in recent periods, receivables collection has shown cyclical improvement, and payables are managed with noticeable variability—likely reflecting strategic considerations. The steady increase in working capital turnover ratios suggests ongoing enhancements in operational effectiveness, leading to better utilization of assets and liabilities to support sales growth.

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Average number of days

The activity ratios for Okta Inc., specifically the Days of Inventory on Hand (DOH), Days of Sales Outstanding (DSO), and the Number of Days of Payables, exhibit notable trends over the examined period.

Starting with the Days of Inventory on Hand, the data indicates that for most of the fiscal years prior to early 2023, this ratio is not available or not reported, suggesting the company either held negligible physical inventory or did not track this metric prominently in those periods. From January 31, 2023, onward, a consistent trend emerges where DOH values are reported and display a gradual increase. Specifically, DOH rose from approximately 61.50 days in January 2023 to nearly 65.96 days by October 2023, indicating that the company is holding inventory for a longer period, which could imply a strategy of increasing inventory levels or a change in inventory management efficiency. This extended inventory period may reflect adjustments in supply chain practices or a shift in product delivery approaches.

Regarding the Days of Sales Outstanding, this metric reveals significant variability over the analyzed period. Early 2020 shows a DSO of approximately 57.34 days, which then increases substantially, reaching a peak of around 111.73 days in January 2022. Subsequently, the DSO declines markedly, dropping below 50 days at several points, including 47.44 days in April 2024, and ends at approximately 46.97 days in April 2025. These fluctuations suggest periods of slower receivables collection, potentially linked to changes in customer credit policies, contract structures, or sales mix. The recent downward trend indicates an improvement in collection efficiency, reducing the average days outstanding.

The Number of Days of Payables demonstrates relatively low and stable figures throughout the period, fluctuating between approximately 6.55 to 34.09 days. Most of the recent data, especially from April 2022 onward, shows days payable in the range of approximately 6.55 to 9.32 days, suggesting that Okta is paying its suppliers within a relatively short window, aligning with a standard or slightly accelerated payment schedule. The fluctuation in payable days may reflect short-term adjustments in payment policies or cash management strategies.

Overall, the trend in activity ratios indicates that Okta is increasingly managing its receivables more efficiently in recent periods, with shorter DSO, while inventory levels have begun to increase slightly after a period of unreported or stable figures. The payables activity remains consistent with prompt payment practices, maintaining a tight working capital cycle. These ratio movements provide insights into the company's operational efficiency and cash flow management strategy, reflecting ongoing adjustments in response to market conditions and internal management decisions.

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Long-term

The analysis of Okta Inc.’s long-term activity ratios reveals distinct trends over the observed periods, specifically focusing on the fixed asset turnover and total asset turnover ratios.

The fixed asset turnover ratio exhibits significant variability across the timeline. Initially, on July 31, 2020, it stood at 3.18, and it experienced rapid fluctuations thereafter. Notably, during the latter part of 2020 and early 2021, the ratio sharply increased, reaching peaks of 12.31 in October 2020 and subsequently 13.31 in January 2021. This upward trend continued through April 2021 (14.45), indicating a period of high efficiency in utilizing fixed assets to generate revenue. The ratio declined to a low of 4.89 in July 2021, then surged again to reach elevated levels of 18.96 in October 2021 and 22.04 in April 2022, signaling periods of enhanced fixed asset productivity. The subsequent months show fluctuations: a decline to 7.66 in July 2022 followed by a rebound to 31.49 in January 2023 and an even higher 36.32 in April 2023, before decreasing again to 14.65 in July 2023. The data beyond this point is not available for further analysis.

In contrast, the total asset turnover ratio demonstrates a more stable and gradual upward trend over the same period. Starting from approximately 0.23 in July 2020, it experienced modest increases throughout the subsequent quarters, reaching approximately 0.28 by April 2025. The ratio’s steady growth suggests consistent efficiency improvements in asset utilization across the company's total asset base, with minimal volatility compared to the fixed asset turnover ratio.

Overall, the data indicates that Okta Inc. experienced periods of significant improvement in fixed asset efficiency, particularly around early 2021 and again in early 2023, corresponding with spikes in the fixed asset turnover ratio. The total asset turnover ratio's steady increase reflects a consistent enhancement in overall asset utilization effectiveness over time. The fluctuations in fixed asset turnover highlight periods of operational or strategic shifts impacting asset productivity, whereas the stability in total asset turnover underscores a broader trend of gradual efficiency gains across the company's asset base.