What happened

Shares of IT service provider Luxoft Holding Inc. (NYSE:LXFT) rose sharply on Friday following the company's fiscal second-quarter report. Luxoft beat expectations for earnings and produced double-digit revenue growth, enough good news to send the stock about 15% higher by noon EST.

So what

Luxoft produced second-quarter revenue of $228 million, up 16.1% year over year and in line with the average analyst estimate. Revenue from the automotive and transport industry soared 76% year over year, while revenue from the financial services industry, Luxoft's largest industry vertical, rose just 4.9%.

The Luxoft logo.

Image source: Luxoft Holding Inc.

The company also reduced its dependence on its two largest customers, bringing the percentage of revenue from these customers to 35.4%, down about 10 percentage points year over year. Outside these two top accounts, Luxoft produced revenue growth of 37.5% year over year.

Non-GAAP earnings per share came in at $0.82, down from $0.83 in the prior-year period but $0.05 better than analysts were expecting. GAAP EPS was $0.54, up from $0.48 in the prior-year period.

Luxoft CEO and President Dmitry Loschinin commented on the company's outlook: "We continue to place strategic emphasis on accelerating our shift to digital innovation as demand for complex digital and cloud-based deployments remain strong. Looking ahead, we are confident that our overall strategy is aligned with the long-term trends across each of our verticals as we look to become an increasingly critical strategic partner for our customers."

Now what

Luxoft expects to produce full-year revenue of at least $920 million, up at least 17.1% compared to the previous year. Adjusted EBITDA margin is expected between 15.5% and 16.5%, while non-GAAP EPS is expected to be at least $2.85. Luxoft's fiscal year ends in March.

While the bottom line moved in the wrong direction on an adjusted basis, the company still beat expectations. This, along with double-digit revenue growth and solid full-year guidance, led investors to push up the stock on Friday.

Timothy Green has no position in any of the stocks mentioned. The Motley Fool recommends Luxoft Holding. The Motley Fool has a disclosure policy.