Okta Inc (OKTA)

Pretax margin

		Jan 31, 2025	Jan 31, 2024	Jan 31, 2023	Jan 31, 2022	Jan 31, 2021
Earnings before tax but after interest (EBT)	US$ in thousands	46,000	-337,000	-801,000	-849,696	-266,191
Revenue	US$ in thousands	2,610,000	2,263,000	1,858,000	1,300,200	835,424
Pretax margin		1.76%	-14.89%	-43.11%	-65.35%	-31.86%

January 31, 2025 calculation

Pretax margin = EBT ÷ Revenue
= $46,000K ÷ $2,610,000K
= 1.76%

The pretax margin of Okta Inc. over the specified period demonstrates significant variability, reflecting substantial fluctuations in the company's profitability before tax expenses. As of January 31, 2021, the pretax margin was notably negative at -31.86%, indicating that the company's pretax earnings were a substantial loss relative to its revenues. This negative margin widened considerably by January 31, 2022, reaching -65.35%, which suggests an increased pretax loss and potentially heightened operational challenges or increased expenses during that period.

By January 31, 2023, the pretax margin improved to -43.11%, representing a relative reduction in pretax losses compared to the previous year. This indicates a period of some recovery or operational improvement, albeit still reflecting significant losses. Further improvement is observed by January 31, 2024, when the pretax margin increased to -14.89%, signifying a continued narrowing of losses, approaching a less severe negative margin and possibly signaling ongoing turnaround efforts or revenue growth.

Most notably, by January 31, 2025, the pretax margin transitions into positive territory at 1.76%. This positive margin indicates that Okta Inc. achieved pretax profitability during this period, marking a significant milestone and potential inflection point in its financial trajectory. Overall, the trend from deeply negative margins to a modest positive margin illustrates substantial improvement in the company's profitability profile over these four years, reflecting either increased revenues, improved cost management, or both.