Hi, everyone. Welcome to Okta's First Quarter of Fiscal Year 2022 Earnings Webcast. I'm Dave Gennarelli, Vice President of Investor Relations at Okta. With me in today's meeting, we have Todd McKinnon, our Chief Executive Officer and Co-Founder; Mike Kourey, our Chief Financial Officer; Frederic Kerrest, our Executive Vice Chairman, Chief Operating Officer and Co-Founder, Brett Tighe, our incoming Interim CFO; and Eugenio Pace, CEO of Auth0. Today's meeting will include forward-looking statements pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to statements regarding our financial outlook and market positioning. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. Forward-looking statements represent our management's beliefs and assumptions only as of the date made. Information on factors that could affect the company's financial results is included in our filings with the SEC from time to time, including the section titled Risk Factors in our previously filed Form 10-Q. In addition, during today's meeting, we will discuss non-GAAP financial measures. These non-GAAP financial measures are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP and non-GAAP financial measures and a discussion of the limitations of using non-GAAP measures versus their closest GAAP equivalents is available in our earnings release. You can also find more detailed information in our supplemental financial materials, which include trended financial statements and key metrics, posted on our Investor Relations website. In today's meeting, we will quote a number of numeric or growth changes as we discuss our financial performance. And unless otherwise noted, each such reference represents a year-over-year comparison. And now I'd like to turn the meeting over to Todd McKinnon. Todd?

Thanks, Dave, and thanks, everyone, for joining us this afternoon. With our strong first quarter results, and the recent closing of the Auth0 transaction, the new fiscal year is off to a fantastic start. There are so many exciting developments at Okta happening right now that I've never been more excited about the future and about our business. I'll start with a quick recap of our Q1 results and then get into some of the other notable highlights including the closing of the Auth0 transaction. Our team has executed exceptionally well at helping customers and organizations safely secure access to technology from anywhere. Although we are not yet in a normalized business environment, we are optimistic about the recovery. One thing is clear: the importance of identity will continue to accelerate as global economies continue to recover. To highlight just a few of our first quarter financial metrics, RPO grew 52%, current RPO grew 45%, total revenue grew 37%, subscription revenue grew 38% and we generated a quarterly record $53 million in free cash flow. We added a record of 650 customers in Q1; our base of large enterprise customers surpassed 2,000 with the addition of 125 customers with an annual contract value greater than $100,000 in the quarter. Consistent with prior quarters, half of these $100,000 ACV additions were from new Okta customers. Here are just a few notable examples of large enterprise wins and upsells in Q1, which come from a wide range of industries. A fantastic new customer identity win was a Fortune 10 company that chose Okta as the identity layer for its new digital application. As part of a highly regulated industry, the organization needed to secure customer access and maintain data privacy, while also providing a unified omni-channel experience for millions of customer interactions via the app and in person. The Okta Identity Cloud will give the organization a unified 360-degree view of its customers. Okta's adaptive multi-factor authentication will allow the organization to build personalized, contextual access policies and Okta lifecycle management will automate progressive profiling and provisioning to ensure customers are only accessing the data they need. A competitive workforce identity win was Western Health, an Australian hospital and community-based healthcare provider. Western Health selected Okta to secure the identities of its 6,500 staff as a part of its new identity and access management strategy to modernize its IT processes, deliver a better experience to its staff, and provide a single source of truth for identity across the business. Western Health will also use Okta Access Gateway to secure access to the key legacy applications. Learn and expand is a key part of Okta's growth strategy; a great example of this is an upsell we closed with an existing workforce identity customer, Essilor Group, the world leader in ophthalmic optics leveraging Okta's CIAM capabilities. Essilor selected the Okta platform to manage its distribution partners' identities, helping the company to engage securely with their partners’ eye care professionals. A common thread with all of these customer examples is that their organizations can identify with at least one, if not all three, of the mega trends that have been driving Okta's business for the past several years: the deployment of cloud and hybrid IT, digital transformation projects, and the adoption of zero trust security environments. Organizations are not just adapting to the pandemic environment, but are retooling their digital strategy and their shifted and dynamic work environments will remain integral to their businesses going forward. Also driving customer conversations are the frequent high-profile cybersecurity attacks. While this month, the Biden administration issued a presidential executive order on improving the nation's cybersecurity posture, which further highlighted the need for a solution like Okta's. The order states that the federal government must advance toward a Zero Trust architecture and explicitly states that government agencies must adopt MFA, which is critical to a Zero Trust environment. We've had some great recent wins across the public sector and see growing opportunity, particularly with federal agencies, given our existing FedRAMP moderate authorization, and recent DoD impact level for provisional authorization. Achieving FedRAMP high is also on the near-term roadmap. Turning to our recent product announcements. At our Investor Day last month, you heard me talk about the Okta Identity Cloud and the platform we're building. Our unified extensible and integrated platform is our foundation to build incredible new products and features, while also making those identity capabilities more accessible to everyone in an organization. This is why I'm so passionate about ensuring that Okta's platform enables us to become a primary cloud. In a cloud-centric world, identity has become even more important and strategic than infrastructure or collaboration clouds because it is the connection to these other clouds. Identity is the epicenter of an organization's tech connections, and it offers the freedom of choice to adopt any technology. Expanding our use cases is an important component of becoming a primary cloud. The announcements we made at Oktane about broadening our capabilities in both privileged access and identity governance represent further expansion into the workforce identity market. Importantly, we're building privileged access for the way critical infrastructure is today and will be in the future, cloud-deployed and just in time. We're reimagining identity governance for a cloud-first world, where the number of resources accessed by an organization has dramatically transformed. We've received positive feedback from customers as they are excited about our goal to unify identity with one control plane. These are exciting developments and I can't wait to update you on our progress. In the meantime, our core products in both customer and workforce identity continue to perform very well. Once again, growth in the quarter was led by our CIAM solutions. Customer interest in recently introduced products like customer identity workflows remain strong and we're seeing more success than ever with our organic CIAM business. Of course, our presence in the CIAM market just took a game-changing leap forward with the closing of the Auth0 acquisition earlier this month. Okta and Auth0 have complementary strengths and expertise, and together, we can now give customers more choice to meet every identity need. In the short-term, we're going to focus on integrating Okta back-end systems, such as those around accounting and other administrative processes. On the product side, we are going to maintain and invest in both platforms and over time, we will be integrating our technologies to provide even more innovation to ensure that customers have a cohesive experience. Our main goal is to maintain the strong momentum we are experiencing in CIAM today across all offerings. We've been a combined company for only a few weeks and we couldn't be happier with the feedback we've received from customers and partners at both Auth0 and Okta. They're incredibly excited about the breadth of use cases and coverage we offer. Everything we heard has reinforced our belief that Eugenio and team have built a very special company. The energy and enthusiasm has also resonated inside our organizations. As we expected, the cultures are very much aligned. Since the closing of the transaction, we've been able to do more detailed analysis on our existing base of customers, and two things became very evident. First, there's even more opportunity to cross-sell and upsell than expected. And second, there's a clear need for both the Okta low-code approach and the Auth0 developer-led approach to the CIAM market. Okta is well positioned to become the standard for digital identity. The Okta and Auth0 platforms are made up of core technologies that are flexible, extensible, and incredibly customizable to make that spectrum possible by building a platform that connects with everything and meets every identity use case. Over time, we will push the technology ecosystem to be safer and create more value for everyone. Together, Okta and Auth0 create a powerful combination. We've strengthened our position as the world's leading independent identity cloud. We will create even more powerful network effects that will drive platform innovation, allowing us to better serve our customers with a broader range of use cases and audiences. As a result, we will capture more of the massive and growing $80 billion identity market opportunity even faster. The world is still in the early stages of modernizing its identity infrastructure. The secular trends I mentioned earlier that have been driving our business will continue to drive our business for years to come. With that as a backdrop, we're establishing a new long-term financial target, which is a significant step up from our prior FY'24 framework. Given our market-leading position, unmatched technology portfolio, and the massive market opportunity, we're confident that we can grow our revenue base to achieve $4 billion in FY'26, with growth of at least 35% each year. Along the way, we will continue to invest in driving product innovation and our go-to-market initiatives while targeting a free cash flow margin of 20% in FY'26. Of course, if we were to grow faster than these levels, we may elect to invest more while balancing free cash flow margins. Before turning it over to Mike, I want to acknowledge his significant contributions to Okta. Over the five plus years, he was the Chair of our Audit Committee, and for his leadership as CFO. Over the past several months, Mike has made a significant impact, especially with the acquisition of Auth0 and operational improvements that he's already implemented. While he'll be stepping down as CFO next week, we are grateful that he's staying on in an advisory capacity to assist with the transition. Michael will always be a friend and considered a member of the Okta family, and we wish him all the best in his future endeavors. We are initiating a search process to fill the position. In the meantime, I'm very happy to have Brett Tighe as Interim CFO. Brett is our Senior Vice President of Finance and Treasurer. He's made countless contributions to Okta over the past six years. He also spent almost 11 years with growing responsibilities in finance at Salesforce. Having worked closely with Brett, I know that he is a terrific finance leader and has the experience to be a great CFO and will be considered in the search process. Now I'll pass it over to Mike to share a few words and then discuss our Q1 financials in more detail.

Thanks, Todd, for those kind words. It has been my privilege to be a member of the Okta team since 2015. I'm tremendously proud of the company's success today and the significant growth opportunities in the future for the company. Over the past several months, I've enjoyed the opportunity to work more closely with the Okta organization and much of the Auth0 organization. I could not be more impressed with the strategic and operational expertise of both teams. Notably, I've worked very closely with Brett since I joined the Board of Directors over five years ago, and I've worked with him shoulder to shoulder since I've been CFO. Brett is a strategic thinker and has a deep understanding of Okta and the identity industry. I have immense respect for Brett and I'm confident he will excel in the job. Lastly, before I discuss our results, note that I will be signing our Q1 quarterly report on Form 10-Q, which will be filed later today. And as Todd mentioned after next week, I will stay on as an advisor to the team to help ensure a smooth transition. Now let's turn to our results. As a reminder, Q1 results do not contain any impact from Auth0 as the transaction closed on May 3. Following my review of the quarter, Brett will provide the business outlook, which will be inclusive of Auth0. Regarding Q1, total revenue increased 37% driven by a 38% increase in subscription revenue. Subscription revenue represented 96% of our total revenue. RPO or backlog, which for us is contracted subscription revenue both billed and unbilled that has not yet been recognized, grew 52% to $1.89 billion. Current RPO, which represents subscription revenue we expect to recognize over the next 12 months, also experienced strong growth of 45% driven by continued strong demand and an uptick in early renewals. We believe year-over-year growth in current RPO is an important metric, especially when viewed along with subscription revenue and billings growth. While we do not provide specific guidance for current RPO, we continue to believe that on an organic basis, excluding Auth0, current RPO growth will outpace subscription revenue growth throughout this fiscal year. Total and current calculated billings grew 74% and 73%, respectively. Calculated billings growth in the first quarter was driven by two factors. First, Okta experienced strength across both new and existing customers, as demand for our products remains robust, driven by the macro trends that Todd mentioned earlier. Second, we implemented operational improvements to our billings process in Q1, which conforms with the practices of other large SaaS peers. These two improvements are: one, we're now billing at contract signature rather than subscription start date; and two, subsequent annual payments are now due rather than billed on the anniversary date. This has a favorable effect on both billings and cash collections timing. Note that even without these process improvements, calculated billings would have been $293 million representing growth of 40%. Going forward, we expect the effect of these changes to be much more modest. Turning to retention, our dollar base net retention rate for the trailing 12-month period remained strong at 120% at the high end of our historical 115% to 120% range. It was down slightly from 121% last quarter, as new customers represented a larger portion of total business this quarter. Gross retention rates remain consistent with Q4 reflecting the value of our product to our customers. Additionally, upsells, particularly with our enterprise customers, were very strong. As a reminder, the retention rate may fluctuate from quarter to quarter, and in the current environment, it's possible that fluctuations and retention rates may be more pronounced. Before turning to expense items and profitability, I'd like to point out that I will be discussing non-GAAP results here going forward. Now, looking at operating expenses, total operating expenses grew 38%. The growth in expenses was partially offset by reduced travel and office-related spending. Headcount growth accelerated to 28% to over 3,000 employees, with the biggest increase in our go-to-market team as we continue to scale globally. We generated a record cash flow from operations and free cash flow of $56 million and $53 million, respectively, which yielded a record 21% free cash flow margin. This is a terrific illustration of the leverage in our model. Free cash flow is driven by strong billings and collections during the quarter. Note that free cash flow was not impacted by the recent invoicing change as the change was implemented at the end of the first quarter. We ended the first quarter with a strong balance sheet anchored by $2.69 billion in cash, cash equivalents, and short-term investments. Now let me turn the call over to Brett to discuss our outlook.

Thanks, Mike. Really appreciate the comments from both you and Todd. It has been a true pleasure to partner with you over the years, and I want to say thank you for all you've done for this company. I'm incredibly excited about the opportunity to step into this role. Now let's get into our financial outlook for Q2 and FY'22. We closed the acquisition of Auth0 on May 3, and will include financial results from Auth0 for the period from the close date going forward. Current and prospective customers are even more excited now that Auth0 is part of Okta and demand remains strong for both of our products. This guidance is inclusive of Auth0 net of the purchase accounting adjustments. Keep in mind that Auth0 has a margin profile consistent with early-stage high-growth companies as it has been aggressively investing to capture the massive opportunity in CIAM. As the business scales, there will be opportunities for efficiencies. For the second quarter of fiscal '22, we expect total revenue of $295 million to $297 million, representing growth of 47% to 48% year-over-year, non-GAAP operating loss of $55 million to $53 million, non-GAAP net loss per share of $0.36 to $0.35, assuming weighted average shares outstanding of approximately 154 million. Given our strong Q1 results, we raised our organic revenue outlook for the full year beyond the earlier estimates and then added the expected contribution of Auth0. For the full year fiscal '22, we now expect total revenue of $1.215 billion to $1.225 billion representing growth of 45% to 47% year-over-year. We also now expect non-GAAP operating loss of $172 million to $167 million, non-GAAP net loss per share of $1.16 to $1.13, assuming weighted average shares outstanding of approximately 159. And while we don't provide explicit guidance for cash flow, given our strong cash flow generation in Q1, we now expect free cash flow to be slightly positive for the fiscal year. This is inclusive of integration and transaction-related costs, which is an improvement from the view we provided last quarter. We had a great quarter and a great start to the fiscal year. We are extremely excited about closing the Auth0 transaction and accelerating our growth together. Okta has developed a strong foundation and market leadership position, and we are confident we will be able to achieve $4 million in revenue in FY'26, with growth of at least 35% each year while targeting a 20% free cash flow margin in FY'26. And as Todd mentioned, if we were to grow faster than these levels, we may elect to invest more while balancing free cash flow margins as we continue to capitalize on the massive market opportunity in front of us. Now I'll turn it back to Dave for Q&A. Dave?

All right. Thanks, Brett. To indicate that you have a question, please click on the raise hand icon. It looks like most of you have already. I will announce you when it's your turn to ask a question. You have to unmute yourself at that time. And in the interest of time, please limit yourself to one question and one follow-up question. So that we're going to go to Adam Tindle at Raymond James. Adam?

Thanks, Dave. First-time caller, longtime listener, so I appreciate you putting me first. I do have a question probably for Todd and Eugenio. Thinking about this Auth0 margin profile, how it's consistent with early-stage high-growth company, trying to think about a way to ask the question. Of similar size and scale to Okta, circa four or five years ago, when I'm comparing the implied operating loss for Okta at that scale versus Auth0, it looks like it's maybe 1.5 times, or more than that on an operating loss profile basis. So I guess the question would be, what are the key similarities and differences that you've observed in the economic models of your own versus theirs? And how do you see the Auth0 profitability ramp versus Okta's from here?

I think the first part of this answer would be just to know philosophically, this is a growth business. So both Okta organic and Auth0 were really, really investing for growth. This is a $30 billion customer identity market, very dynamic market, and the stakes are very high to win this market. So we’re being very aggressive. And I think that we're seeing tremendous success on the Okta side. I'll let Eugenio comment about what they're seeing on the Auth0 side in terms of success.

Yes. I would agree with the same high-growth profile that was really described. There’s a - what I would add perhaps is that what was different from us, it's what makes the combination even stronger, right? So we have a heavy international profile. In previous calls, we mentioned that a large percentage of our revenue originates outside the U.S., almost 50% of that, in our case. We are also a developer-oriented company, which has a slightly different go-to-market. But it's also complementary to what Okta has been doing for years. And that’s maybe a different audience and a bigger audience that we can now reach out jointly and continue to grow. We had a great Q1. Our Q1 is slightly, one month shifted from Okta's, but our Q1 was - we beat the plan and we are heading towards a really, really strong Q2 as well. So I couldn't be more excited.

And one thing I'll add there, too, to give you more color, we actually went back and looked at the comparisons, the past comparisons, kind of like what you did. I don't remember the exact numbers. But one of the qualitative differences between the two models was the developer model that Auth0 has been very successful for required spending a little bit ahead of when the actual revenue ramped, because the developer got the word out there and started to seed a lot of deals. But it took an enterprise sales team to come in and really get that revenue engine running. That's why one of the many reasons we're so excited about the combination because we have a great enterprise sales team. Auth0 does as well. It's just not as big as ours. And we're seeing a lot of in the first few weeks. We're seeing a lot of great synergy between how, over time, we'll really be able to leverage the sales teams together and make something much, much more than the sum of the parts.

Very helpful color. Maybe just as a quick follow-up, Todd. On the CFO search, big picture here. You have over $2.5 billion of cash on the balance sheet. When I look at your financial targets that were updated, fiscal 2026, you're going to have nearly $1 billion of annuity stream of cash that's highly recurring and resilient. So just wondering how you're thinking about key characteristics for the next CFO with that as the backdrop?

I think the points you mentioned are definitely part of the equation. I would add that a significant M&A integration is - the integration with Auth0 is very early, and it's very, very critical for the success of the company. So experience with that will be helpful. I also think just high growth, dynamic, adaptable to change. Because one thing about our industry, we're defining the future of identity. We're working hard to make sure that identity has its rightful place as a primary cloud in the ecosystem of every organization in the world. That's something that hasn't been done before. In past generations of technology, identity was really a part of other platforms. It was a part of Windows or it was a part of Oracle. We're making this first-class primary cloud, and that's different and unique. I think, not just the CFO, but the entire team has to be up for that challenge. That’s important, an important part of it as well.

Appreciate the details and congrats on the strong start.

Thank you.

Next, we're going to go to Keith Bachman at BMO.

Hi. Thank you. I want to ask the question that was just asked a little more directly. Can you tell us what the revenue contribution is for FY 2022 and also what the cost structure that you're layering into? Most companies when they do a deal provide this information. I'm a little confused on just why you're not laying it out more explicitly.

It's good feedback. I'll pass it on to Brett to talk about the model, try to give you some more color there. Just in general, we felt this was the best high-level way to communicate the business. As we get feedback and as we go forward, we'll break other things out as we need to, but that's kind of the high-level thinking on it.

Thank you, Todd. To discuss the revenue components, it's important to note that Q1 for Okta standalone was very strong, and we believe that momentum will carry through the rest of the year, which is reflected in our revenue guidance. If we had been an independent company, we would have increased our full-year guidance, not just for Q1 but for Q2 through Q4. As Eugenio mentioned, Auth0 is on track to meet its goal of exceeding $200 million in ARR by year-end, which is also included in our revenue guidance. We did mention the deferred revenue haircut; we closed the deal three weeks ago, and while we have an estimate in our revenue guide, we will refine that with our auditors in the coming weeks and provide further details during Q2 earnings. Regarding margins, Q1 was a strong quarter for Okta standalone, and we expect that trend to continue. We're very pleased with Okta's individual performance. Auth0 is poised to invest in significant opportunities within the CIAM market, which is valued at $30 billion, as well as in the $50 billion workforce market for cross-selling. However, the accounting for deferred revenue and other acquisition-related costs is affecting our operating margin. On a positive note, we previously indicated that free cash flow was slightly positive without considering acquisition and integration expenses; now we see it as slightly positive even when including those expenses, showing good progress in terms of margins.

Okay. Thank you, Brett. My two cents would be the next time you come on, as I think investors would certainly appreciate some cadence on what the organic growth was, whether it's billings or revenues.

Could you discuss the competitive landscape, both with and without Auth0? Are you noticing any changes from Microsoft, especially in the mid-market segment? Have your win rates shifted in relation to Microsoft compared to other competitors? It would be great if you could provide a broader perspective on the competitive landscape, considering that Auth0 is now part of your offerings. Thank you. The competitive landscape has largely been vis-à-vis the major platform players like Google and Amazon and Microsoft has largely been consistent the last five or six years, ever since Microsoft launched a product, I think what is going on now is seven or eight years ago. Not for Okta when they launched their competing product, it was scary at the time. But it was really the best thing that ever happened to us. It validated this concept of identity being this primary system that people had to invest in. So we haven't seen a change there. It's interesting. I think, in general, Microsoft is relatively weak in the mid-market for their identity business. So it's interesting that you'd mentioned that you had a question about them being strong there. I would say I would call that out as a weakness of Microsoft being the smaller companies they've been market, maybe it's because of their channel; I don't know why, but they've tended to not show up very well in that segment. The question about Auth0, the competitive dynamic on customer identity is really a build versus buy conversation. If you think about the market being $30 billion, we're going to get to some of that with our low-code approach with Okta organic CIAM. A lot of that $30 billion was going to people building their own solutions. That’s the power of this, from the ground up developer-centric approach. It really increases the capability to take on some of those projects that would have been built internally.

If you think about it, the only companies that can afford to start from scratch and not think about this problem as an existing problem are small startups, companies that just started today. Everybody else already has a solution deployed. In our deals with customers, everybody has its own thing already. Some of the pushback that we saw in the past has gone away because the realization that they can do better than us with all the resources we've put into solving this problem has gone away. The problem is getting complex; attacks are getting more sophisticated; more things are being moved to the digital world. The notion that adding a little bit more effort and fixing your existing home-built system to deliver on today's requirements is just going away very quickly.

Next up, we're going to Taz at Guggenheim.

I have a question about the impact of Auth0 on the billings. You gave us the impact on revenues. But given the deferred revenue write down, I would assume that the impact on billings would be higher than the revenue impact, is that a fair statement? That your growth impact on billings would be more than on revenues from Auth0.

Yes. Taz, let's talk about how to think about billings for Q2 and FY'22. A couple of things going on there, just like I said on revenue and margin, Okta continues standalone to do very well there. So obviously as shown by the 40% Q1 billings growth, which we're very pleased to see. Q1 was the biggest impact of any quarter really going forward, but Q2 will continue to modestly help us along because we're bringing billings forward and free cash flow bringing that forward as well. On the other side, obviously, Auth0 will be layering that on top. When we talk billings in the future, we're going to talk net revenue acquired deferred revenue. So when you think about the billings number, Auth0 will add a bunch of DR into Q2. We're going to back out any acquired DR so we can get a true operational billings number. Regarding growth going forward, we typically talk about it in relation to subscription revenue growth. Because of all those impacts I just described in Q2, I'd probably say mid-single digits that billings growth will be higher than subscription revenue growth. For FY'22, primarily due to the Q1 operational change, that number will probably be high single digits of delta between billings growth and subscription revenue growth for FY'22.

Can you just comment on the deferred revenue right now you're assuming for Q2, like what would have been the normal run rate of revenue for Auth0? And then how much headache are you assuming in your guidance for Q2?

The deferred revenue haircut, we've just obviously done the transaction a little over three weeks ago, we think it's probably in the range of plus or minus 20%. We're going to work that out over the next couple months before we talk to you guys after Q2.

Does that go away completely in Q2? Or do we have some lingering write down in Q3 and Q4 as well?

It will linger primarily because Auth0 being in a lot of ways very similar to Okta, they annually bill a lot of their customers. As you know, if it's built DR, it's more annual nature, so it will last likely into Q1 of FY'23. Obviously, the impact will be less in FY'23. But you guys know how the mechanics work.

Guys, next, we're going to Ittai at Oppenheimer.

Thanks, guys, a great quarter. Todd, I want to go back to the prepared remarks a little bit. I think you mentioned that you see more opportunities now to cross-sell with Auth0 versus what you expected in our last update, maybe you can give us a little bit more detail of what else did you find in there after you started digging in?

There's a few things. First, we had an assumption about this $30 billion, CIAM, TAM, they're going after with the developer-led approach. We're going after with a low-code approach. We had an assumption that there wasn't much overlap between those two customer bases and prospects. That's been validated. One thing we've been able to do in the first three weeks is finally see all the customer lists and the pipelines. There's very little overlap there. Which means it validates our thesis that these are two distinct parts of this $30 billion market. So that's really exciting. The second thing we're doing is we're collaborating very well at the go-to-market level to ensure we lead with the right solution when there is overlap among prospects. We're not trying to sell low code to someone that wants the developer approach and the other way around. So there’s that synergy. Then, the other two things I’d call out are: Okta has a couple of products, like advanced server access, which is the foundation for our PAM product that's going to be released in a few quarters. That is really perfect for dev shops, for people with a lot of Linux servers that are dynamically starting and stopping servers, which is overlapping with Auth0's customer base. We think there's a big upsell opportunity for our ASA and PAM products into the Auth0 customer base. Also, Okta Access Gateway has been really helpful in selling to companies that have hybrid IT, and Auth0's customer base has the same challenge. We think that's a big cross-sell opportunity as well. Those are some specifics. I know Eugenio has been working on this close as well; he probably has some more anecdotes he can share.

Look, we only had like three weeks, it feels like three years already. But it's only been three weeks that we were able to kind of look into details. Our teams are uncovering tons of opportunities. Todd mentioned integration with ASA, server access with the Okta application gateway; there are opportunities between B2B and B2E, so workforce and business identity. Tons of connecting points are being uncovered together. What's even more interesting and exciting is that it’s not just our teams finding those connecting points. In many cases, it's our customers who are saying, 'Hey, can we use ASA here? I'm already using Auth0 for protecting my apps. Can I use ASA in my DevOps team?' It's great to see the excitement not just on our side but from our customer base as well, and they are identifying synergy opportunities.

It's great to hear that. As a follow-up, Todd, in your prepared remarks, you mentioned that workforce identity met expectations, but it seems that it wasn't a source of growth. Can you provide insight into the current growth rate of your workforce business? What has it decreased to, and how should we view the future growth of that business?

Yes. Both of our organic businesses are very strong. The growth number and subscription revenue is 38%; billings was a little bit north of that. They're both doing really well. I think the workforce product continues. We saw the numbers; the large transactions over $100,000 were particularly strong. Our advanced lifecycle management product is exciting because it gives our customers more power and helps automate more of their processes. It’s the foundation for our upcoming identity governance product. So lifecycle management performing well is a good harbinger for success in those broader product categories. That's important for this concept that we're trying to build the primary cloud for identity. We want to be that vendor for every use case customer has, whether it's customer identity, building an app, B2E, B2C, privilege access, IGA, or workforce. When you talk to customers, that resonates. This is a very complex landscape and they want all their use cases covered. A very good trend for the workforce business happened in the public sector. The Biden administration basically told every federal agency they must have multi-factor authentication. It’s a perfect storm for Okta, having the right product at the right time. The federal agencies are moving to cloud and zero trust.

That's great. Thank you very much. I'll echo Keith's comments; more itemized numbers, please. Thank you.

That was another vote for that, good to hear. Yes. Do we have a voting feature on Zoom?

Next up, we're going to Rob Owens at Piper.

Todd, you mentioned something earlier, and I was hoping you could expand on the public sector perspective. Could you clarify if Auth0 has a significant presence in this area? Also, Freddie appears to be a bit isolated, so I'll reach out to my Brady Bunch windows here. Please discuss the channels to market for the public sector and what strategies you have in place.

Yes, absolutely. Thank you for the opportunity. I was just sitting here and really enjoying the conversation, taking some notes on my own. So happy to participate actively. I appreciate the opportunity, Rob. Yes. Certainly, when it comes to the public sector, federal, state, local, things are going very well, and we think the opportunity there is excellent. The Biden administration's executive order emphasizes the need to improve cybersecurity posture, which is a great opening for Okta. We think we are in a good spot, and we're working toward our FedRAMP high authorization. As organizations consolidate their vendors, our strong momentum with customers has helped us become a primary choice and build relationships.

Great. Thanks, Freddy. And quick one for Brett, where are you profitable come Q2, what would be the fully diluted share count you're looking at?

Maybe around 170 million.

Next we're going to Jonathan Ho at William Blair.

Hi, good afternoon. Yes, I wanted to ask, I guess, Mike, I think some investors would like a little bit more clarity on why you're stepping down after a relatively brief period in the seat. So could you maybe help us understand the timing and the rationale for the decision?

Thank you, Jonathan. Yes, as I mentioned, I've been on the board as audit chair since fall of 2015. It's been a fantastic experience and Okta is one of the finest companies on the planet. I have immense respect for the team and since I've been CFO, I’ve worked closely with Brett. He is a great candidate to succeed me, and I'm excited to help with the transition. My stepping down is about the timing; I need to focus on family priorities. I’ll stay on as an advisor to ensure a smooth transition.

Thank you. Can you talk a little bit about some of the traction you've gotten with your privilege in GRC Solutions? I know it's early in terms of revenue contribution, but can you give us a sense of how often you're seeing that bought as part of a bundle or out of an initial purchase? Thank you.

Yes. The advanced server access product that we've had in the market for about a year and a half is the foundation for our PAM. We're expanding that out over the next few quarters and we're going to release the full PAM product in the first quarter of next year. Same goes for the advanced lifecycle management module that we've had for about a year; it’s performing really well as customers invest in automating processes.

Just a quick one for me. I was wondering if you could just give us an update on the development progress you've made regarding the upcoming IGA and PAM products that you're soon to be releasing next year. Maybe which one is more complicated to develop?

They're going well. Teams are cranking away, working with early customers, vetting the plans. The biggest opportunity in both of them is to resist the temptation to implement things that have been done before because there are existing tools. We really have to challenge ourselves to build the future solutions, not just replicate the past. That’s an engineering challenge, but also a product challenge.

And then, Todd, do you think customers will be willing to deploy a good enough solution for both those two, for the benefit of managing just one platform and identity? Or do you have to be a market leader in both to really convince customers to move to your platform?

I think it's a little bit semantics. We're going to be the market leader for the customers that want a modern solution. We're not going to replace legacy systems. This is about the 10 times the customers that don't have those things right now. The companies that need modern versions will certainly find what we offer compelling.

Next, let's go to Joshua Tilton at Berenberg.

I want to discuss the future of the identity market as it converges. Customers are increasingly seeking to purchase a single product or a unified bundle for access management, PAM, or governance. Which of these three product features do you believe will influence a customer's decision to select one vendor over another?

I think it's the core access management that starts to get fuzzy between that and PAM. With remote work and cloud, many accounts are now privileged. The degree to which we can be the leader in securing environments and giving access control, while making it easier for users is key.

If I could just follow up on that public sector comments, the simple way to think about it is Fed Gov employs 2 million people and MFA is $76 per user per year. That implies a sizable opportunity there. So anything directly you guys are doing to capitalize on that opportunity?

We have a dedicated sales team, and we’re ramping that up. We have the necessary authorizations, and we've been working in the public sector for quite some time. The timing's good, and we've seen progress with customers there.

It's also not just direct. There's a channel component. We're building those relationships, but it takes time to get those in place. We're focused on that as we see the results from it.

Okay, we're running long. We're going to take one more question from Gray Powell at BTIG.

Hey, great. Thank you very much for working me in here at the last minute. Really appreciate it.

Make it a good one, Gray, make it a good one.

All right. I think I got one. So I'm going to follow up on the guidance questions. If I look at your Q1 results in a vacuum, the upsides of revenue was actually a little better than what you've seen in the last few quarters. The implied operating loss for Okta at that scale versus Auth0 looks like it's maybe 1.5 times, or more. So if Q1 was a fairly standard auto revenue beat, is it safe to assume that the organic upsides of the full year guidance would have been a fairly standard auto raise maybe in the, I don't know, $30 million to $40 million range?

I was going to say I think that's fair.

Okay. Apologies to those that we didn't get you on the call. We will take your questions afterward, if you'd like. Before you go, we want to let you know. We'll be at two virtual conferences this quarter, we will be at the William Blair Growth Stock Conference on June 3 and the BofA Global Tech Conference on June 8, and we're also participating in a number of bus tours. So we hope to see you at one of those events. So that's it for today's meeting. If you have any follow-up questions, you can email us at [email protected]. Thanks again.

Thanks, everyone.