What happened

Shares of Nutanix (NASDAQ:NTNX) jumped on Tuesday after the cloud computing company reported its fiscal first-quarter results. Nutanix beat analyst estimates across the board, and provided guidance that was in line with expectations. The stock was up 16.3% at noon EST today.

So what

Nutanix reported first-quarter revenue of $314.8 million, up 0.5% year over year and about $8.4 million above the average analyst estimate. The company is transitioning to a subscription-based business model, which is putting pressure on sales. Hardware revenue was down significantly from the prior-year period.

A cloud.

Image source: Getty Images.

"We continued to make progress toward our goal of more than 75% of billings coming from subscription by the end of the fiscal year, further demonstrating that customers want the freedom and flexibility that a subscription software model offers," CFO Duston Williams said.

Non-GAAP (adjusted) earnings per share came in at a loss of $0.71, versus a loss of $0.13 in the prior-year period, but $0.04 better than analysts were expecting. GAAP operating expenses soared 38%, despite the nearly flat revenue.

Now what

For the second fiscal quarter, Nutanix expects software and support revenue between $330 million and $335 million, along with an adjusted net loss per share of $0.70. For the full year, the company sees software and support revenue between $1.3 billion and $1.4 billion.

Eventually, Nutanix will complete its subscription transition, easing the pressure on its revenue and earnings. While the company posted a massive loss for the first quarter, investors found enough good news to propel the stock higher.