Okta (NASDAQ:OKTA) layoffs are underway as the U.S. identity and access management company cuts jobs.
According to a filing with the U.S. Securities and Exchange Commission (SEC), Okta is laying off 300 full-time employees. That includes both workers in the U.S. as well as those around the world.
Okta says these layoffs are part of a restructuring plan it’s undergoing in 2023. It expects to suffer a $15 million charge in the fourth quarter of fiscal 2023. It expects the majority of employee severance and benefits costs to be paid in Q1 of fiscal 2024.
Todd McKinnon, CEO of Okta, explained the reasoning behind the job cuts in an email to employees:
“We entered fiscal 2023 with a growth plan based on the demand we experienced in the prior year. This led us to overhire for the macroeconomic reality we’re in today. In addition, in the first half of FY23, we faced our own execution challenges. I wish I had responded sooner, but we’re doing the best we can today to adjust to this reality.”
Analyst Upgrades OKTA Stock
Needham also weighed in on OKTA stock following the news of layoffs today. This has the firm bumping shares of OKTA up to “buy” from the prior “hold” rating. That matches the analyst consensus for OKTA stock based on 35 opinions.
Needham also set a price target of $90 per share. That represents a potential upside of 18.2%. It’s also above the analyst consensus price target of $83.32 per share.
OKTA stock is up 3.9% as of Thursday morning.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.