Okta Inc (OKTA)

Quick ratio

		Jan 31, 2025	Jan 31, 2024	Jan 31, 2023	Jan 31, 2022	Jan 31, 2021
Cash	US$ in thousands	409,000	334,000	264,000	260,000	434,607
Short-term investments	US$ in thousands	2,114,000	1,868,000	2,316,000	2,242,000	2,152,580
Receivables	US$ in thousands	621,000	559,000	481,000	398,000	194,818
Total current liabilities	US$ in thousands	2,523,000	1,782,000	1,465,000	1,243,000	1,545,610
Quick ratio		1.25	1.55	2.09	2.33	1.80

January 31, 2025 calculation

Quick ratio = (Cash + Short-term investments + Receivables) ÷ Total current liabilities
= ($409,000K + $2,114,000K + $621,000K) ÷ $2,523,000K
= 1.25

The quick ratio of Okta Inc. over the analyzed period demonstrates notable fluctuations, reflecting changes in the company's short-term liquidity position. As of January 31, 2021, the quick ratio stood at 1.80, indicating that the company held approximately $1.80 in liquid assets for every dollar of current liabilities, suggesting a relatively strong liquidity cushion. By January 31, 2022, this ratio increased significantly to 2.33, implying an enhancement in liquidity and a more robust ability to meet short-term obligations without relying on inventory or other less liquid assets.

Subsequently, the quick ratio declined slightly to 2.09 as of January 31, 2023, signaling a modest decrease in liquidity but still maintaining a healthy buffer. The downward trend continued thereafter, with the ratio dropping to 1.55 by January 31, 2024, and further to 1.25 as of January 31, 2025. Despite the decline, the ratios remained above 1.0 throughout the period, indicating that Okta retained enough liquid assets to cover its current liabilities, although the decreasing trend suggests a gradual reduction in short-term liquidity.

Overall, the pattern reveals that while Okta's quick ratio experienced periods of strengthening, notably between 2021 and early 2022, it has been on a declining trajectory over the subsequent years. This trend may merit further investigation to understand underlying factors, such as changes in cash, marketable securities, or current liabilities, which could impact the company's liquidity management strategy moving forward.