Okta Inc (OKTA)
Current ratio
| Jan 31, 2025 | Jan 31, 2024 | Jan 31, 2023 | Jan 31, 2022 | Jan 31, 2021 | ||
|---|---|---|---|---|---|---|
| Total current assets | US$ in thousands | 3,416,000 | 2,980,000 | 3,229,000 | 3,041,000 | 2,878,570 |
| Total current liabilities | US$ in thousands | 2,523,000 | 1,782,000 | 1,465,000 | 1,243,000 | 1,545,610 |
| Current ratio | 1.35 | 1.67 | 2.20 | 2.45 | 1.86 |
January 31, 2025 calculation
Current ratio = Total current assets ÷ Total current liabilities
= $3,416,000K ÷ $2,523,000K
= 1.35
The analysis of Okta Inc’s current ratio over the specified periods reveals a pattern of fluctuations that reflect changes in the company's short-term liquidity position. As of January 31, 2021, the current ratio was 1.86, indicating that the company held approximately $1.86 in current assets for every dollar of current liabilities, suggesting a relatively comfortable liquidity cushion at that time.
By January 31, 2022, the current ratio increased significantly to 2.45, which implies a strengthening in short-term liquidity and possibly an improvement in liquidity management or an increase in current assets relative to current liabilities. This ratio suggests that the company was well-positioned to meet its short-term obligations with ample current assets.
However, by January 31, 2023, the current ratio slightly declined to 2.20, still indicative of a healthy liquidity position, but reflecting the initial signs of a potential easing in the company's short-term liquidity buffer.
The downward trend continued into January 31, 2024, when the current ratio decreased further to 1.67. This decline may be attributed to either a reduction in current assets, an increase in current liabilities, or both. The ratio nearing 1.7 suggests a more modest liquidity cushion, which warrants ongoing monitoring to assess whether the company maintains sufficient liquidity to cover its short-term liabilities comfortably.
Most recently, as of January 31, 2025, the current ratio further decreased to 1.35. This value, while still above 1, indicates a thinning of the liquidity margin and suggests that the company's short-term assets are less than 1.5 times its current liabilities. This downward trend could point to a need for improved liquidity management or strategic adjustments to ensure adequate coverage of obligations.
In summary, Okta Inc’s current ratio experienced an overall decline from 1.86 in 2021 to 1.35 in 2025. Although the ratios remain above the critical threshold of 1, indicating that current assets generally surpass current liabilities, the declining trend signals a gradual erosion of liquidity comfort over this period. This warrants further analysis of factors contributing to these changes, including asset composition, liability structure, and operational cash flows.
Peer comparison
Jan 31, 2025