Cloud Stocks Rally, Led by Okta

Okta's fourth-quarter revenue increased 11% year-over-year to $761 million, with subscription revenue also growing by 11%. The company posted an adjusted earnings per share of $0.90, beating analyst forecasts of $0.85. This performance was announced alongside a $1 billion share repurchase program. Despite the strong quarterly results, Okta's stock initially fell in after-hours trading. The company's guidance for the first quarter of fiscal year 2027 came in slightly below Wall Street expectations, with projected revenue between $749 million and $753 million. However, the full-year forecast was more optimistic, projecting revenue of $3.17 billion to $3.19 billion, just above consensus estimates. The rally in cloud stocks comes after a challenging start to the year for the sector. Cloud-focused exchange-traded funds (ETFs) have seen significant declines in early 2026, with the WisdomTree Cloud Computing Fund (WCLD) down roughly 22% year-to-date through the end of February. Okta's CEO, Todd McKinnon, highlighted the growing importance of securing AI agents as a key opportunity for the company. Analysts see this focus on AI agent security as a potential significant growth driver, though they also note the intense competition from Microsoft and other cybersecurity firms. The company's remaining performance obligations, which represent future contracted revenue, grew 15% to $4.83 billion.