Okta, Inc. Earnings Per Share Disclosure
| Year Ended January 31, | |||||||||||||||||||||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||||||||||||||||||||
| Class A | Class B | Class A | Class B | Class A | Class B | ||||||||||||||||||||||||||||||
| (dollars in millions, shares in thousands, except per share data) | |||||||||||||||||||||||||||||||||||
| Basic net income (loss) per share: | |||||||||||||||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||||||||||||||
| Net income (loss), basic | $ | 27 | $ | 1 | $ | (339) | $ | (16) | $ | (778) | $ | (37) | |||||||||||||||||||||||
| Denominator: | |||||||||||||||||||||||||||||||||||
| Weighted-average shares outstanding, basic | 162,082 | 7,487 | 156,335 | 7,299 | 150,891 | 7,132 | |||||||||||||||||||||||||||||
| Net income (loss) per share, basic | $ | 0.16 | $ | 0.16 | $ | (2.17) | $ | (2.17) | $ | (5.16) | $ | (5.16) | |||||||||||||||||||||||
| Diluted net income (loss) per share: | |||||||||||||||||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | 27 | $ | 1 | $ | (339) | $ | (16) | $ | (778) | $ | (37) | |||||||||||||||||||||||
Gain on extinguishment of debt, net of interest expense1 | (17) | (1) | — | — | — | — | |||||||||||||||||||||||||||||
| Net income (loss), diluted | $ | 10 | $ | — | $ | (339) | $ | (16) | $ | (778) | $ | (37) | |||||||||||||||||||||||
| Denominator: | |||||||||||||||||||||||||||||||||||
| Number of shares used in basic calculation | 162,082 | 7,487 | 156,335 | 7,299 | 150,891 | 7,132 | |||||||||||||||||||||||||||||
| Weighted-average effect of diluted securities related to: | |||||||||||||||||||||||||||||||||||
| Employee share-based awards | 1,832 | 2,942 | — | — | — | — | |||||||||||||||||||||||||||||
| Convertible senior notes | 743 | — | — | — | — | — | |||||||||||||||||||||||||||||
| Assumed conversion of Class B to Class A common shares | 10,429 | — | — | — | — | — | |||||||||||||||||||||||||||||
| Number of shares used in diluted calculation | 175,086 | 10,429 | 156,335 | 7,299 | 150,891 | 7,132 | |||||||||||||||||||||||||||||
| Net income (loss) per share, diluted | $ | 0.06 | $ | 0.06 | $ | (2.17) | $ | (2.17) | $ | (5.16) | $ | (5.16) | |||||||||||||||||||||||
1 Under the if-converted method, net income is adjusted to reflect the assumption that the convertible senior notes were converted at the beginning of the period. | |||||||||||||||||||||||||||||||||||
| Year Ended January 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| (shares in thousands) | |||||||||||||||||
| Employee share-based awards | 4,503 | 15,179 | 17,334 | ||||||||||||||
| Convertible senior notes | 4,170 | 5,473 | 11,485 | ||||||||||||||
| Total | 8,673 | 20,652 | 28,819 | ||||||||||||||
About Earnings Per Share Disclosures
The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.
Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.