Cloud identity management service provider Okta Inc. showed positive free cash flow for the first time in its history as it posted yet another strong set of financial results.

The company beat market estimates with a loss before certain costs such as stock compensation of 4 cents per share, or $3.9 million, on $105.6 million in revenue. That easily beat Wall Street’s forecast of an 11 cents per share loss on revenue of $96.93 million.

More importantly, Okta’s losses are well down from the same period one year ago, when it posted a loss of 19 cents a share.

Key to Okta’s strong showing was its subscription revenue, which grew 58 percent from a year ago, to $97.7 million. The company also said it was cash-flow positive in the quarter at $1.4 million, compared with negative cash flow of $11.2 million a year ago.

Executives said in a conference call that Okta’s growth is thanks to continued momentum in large enterprises, where it fulfills a strong demand for federated identity management services.

That need has emerged from the explosion of software-as-a-service, a market that barely existed 15 years ago but is now expected to top $74 billion in revenue this year, according to Gartner Inc. As organizations embrace SaaS, their ability to control access has slipped because they no longer own the software and underlying infrastructure needed to support their businesses.

Okta gives back this control to companies through an array of identity management services, including multifactor authentication, universal directory services and application programming interfaces for management and security.

In the quarter Okta expanded its customer base to more than 5,600 organizations, including 100 new customers with more than $100,000 in annual recurring revenue. It also expanded deployments with existing customers such as the Transportation Security Administration, executives said.

“Our continued strength is a testament to the growing pervasiveness of identity,” Okta Chief Executive Todd McKinnon (pictured) said in a statement. “We believe we are well positioned to further benefit from these tailwinds as organizations continue their move to the cloud, while digitally transforming and securing their businesses.”

For the next quarter, Okta is expecting an adjusted loss of 8 to 9 cents on revenue of $107 million to $108 million. The analyst consensus has the company down for a fourth-quarter loss of 11 cents on revenue of $99.87 million.

Photo: Okta