What happened

Shares of cloud software provider Domo (NASDAQ:DOMO) soared on Friday after the company reported strong third-quarter results. The stock was up about 20% at 12:55 p.m. EST.

So what

Domo reported third-quarter revenue of $36.8 million, up 30% year over year and nearly $2 million above the average analyst estimate. Billings rose 29% year over year to $38.8 million, and subscription revenue surged 34% to $30.4 million.

A person looking at a screen.

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Non-GAAP earnings came in at a loss of $27.9 million, or $1.06 per share, up from a loss of $41.5 million in the prior-year period. Operating expenses declined by about 10% year over year.

CEO Josh James said: "Demand for our products and services continues to grow as enterprises around the globe embrace digital transformation and push our products deeper into their business processes. We have a very large multibillion-dollar market opportunity in front of us." 

Now what

Domo expects fourth-quarter revenue between $37.5 million and $37.9 million, along with a non-GAAP loss of $1.23 to $1.27 per share. Both are above average analyst estimates of $35.7 million and a loss of $1.39, respectively.

With revenue rising and costs being kept in check, investors had plenty of reasons to bid up the stock on Friday, despite the large and persistent losses.