Shares of Okta Inc. (OKTA) experienced a positive surge of 3.2% in premarket trading on Thursday. This comes after the identity software company revealed its plans to undergo a workforce restructuring process, with the objective of enhancing overall efficiencies and profitability.
According to an 8-K filing submitted to the Securities and Exchange Commission, Okta disclosed that approximately 7% of its workforce will be affected by the restructuring. This entails the elimination of 400 full-time jobs. As a consequence of these layoffs, the company expects to incur restructuring charges amounting to $24 million in the fiscal fourth quarter. These charges will primarily cover employee severance and benefits costs and are anticipated to be paid during the first quarter.
Despite these organizational changes, Okta remains steadfast in its financial projections for the fourth quarter. In late-November, the company previously stated that it anticipated adjusted earnings per share ranging from 50 cents to 51 cents, alongside a revenue forecast of $585 million to $587 million.
Notably, Okta's stock value has soared by an impressive 20.3% over the past three months leading up to Wednesday. By comparison, the S&P 500 has recorded a gain of 14.3% during the same timeframe.
Okta Inc. is taking proactive measures to streamline its operations and drive improved performance. The company's decision to undergo a workforce restructuring is projected to yield enhanced efficiencies and contribute to long-term profitability. While acknowledging the challenges ahead, Okta maintains its financial guidance and remains optimistic about its future prospects in the identity software market.