Image source: Getty Images.

What happened

Shares of Cirrus Logic (NASDAQ:CRUS) bounced as much as 11.9% higher before noon on Friday, following the release of a solid second-quarter earnings report.

So what

In the second quarter, Cirrus Logic's revenue grew 39.7% year over year to land at $428.6 million. Adjusted earnings more than doubled to $1.35 per diluted share.

Analysts would have settled for earnings of $1.05 per share on sales near $397 million. Cirrus passed the Street's earnings target by 29%.

Looking ahead, the designer of high-performance audio products set its third-quarter revenue target at approximately $495 million. That's $55 million, or 12%, above the current Street view.

Now what

Say what you will about Apple (NASDAQ:AAPL) and its decision to remove the headset jack from the iPhone 7, but that move is most certainly helping audio-chip provider Cirrus Logic.

"We are extremely pleased with our progress in the September quarter as we began volume shipments of our new digital headset solution," said Cirrus CEO Jason Rhode in a prepared statement, ever careful not to mention the company's important customer by name.

Later, Rhode clarified that he expects a heavy order volume for digital headsets as consumers get used to the idea of having wireless headsets instead of the old plugged-in variety.

The all-digital headset conversion gives Cirrus another entry point into the product-design process, and it shows on both the top and bottom lines.

Thanks to Apple's increased audio-chip orders, Cirrus shares are trading near multiyear highs at prices last seen in 1995. Even so, the stock still looks reasonably affordable with a P/E ratio of just 15 times forward earnings.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.