What happened

Shares of programmable microchip maker Xilinx (NASDAQ:XLNX) were soaring on Thursday, rising as much as 15.7% just before 10 a.m. EDT. Lifted by a strong earnings report for the second quarter of fiscal year 2019, the stock stayed aloft at a 15.5% gain as of 2 p.m.

A technician installs a microchip on a circuit board with the help of tweezers.

Image source: Getty Images.

So what

Second-quarter sales rose 20% year over year to land at $746 million. Adjusted earnings stopped at $0.87 per diluted share, 34% above the year-ago period's result. Your average analyst would have settled for earnings of $0.76 per share on revenue in the neighborhood of $710 million.

Looking ahead, Xilinx's management expects third-quarter revenue to grow roughly 22% above the third quarter of fiscal 2018, adding up to approximately $770 million. The Street had been looking for $720 million.

Now what

In a conference call with financial analysts, CEO Victor Peng gave a verbal high-five to his company's communications division. That segment led the way with revenues 23% above the year-ago result, as Xilinx is staking a claim in the brand-new 5G wireless market.

This led Peng to say: "Communications was very strong in Q2, driven by LTE upgrades, pre-5G, and some early 5G deployments. Our wireless business grew very significantly with broad-based strength in both radio and baseband applications with major OEMs across multiple geographies, and we resumed shipping to ZTE."

So it's a classic beat-and-raise performance, enhanced by signs that Xilinx is unlocking several additional growth drivers right now. The enthusiastic market reaction to all of this good news should come as no surprise.

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.