Shares of MicroStrategy (MSTR -3.81%) rose on Wednesday after the enterprise software provider reported its fourth-quarter results. The company posted a small sales increase, beating analyst expectations. The stock was up about 10.6% at 12:40 p.m. EST.
MicroStrategy reported fourth-quarter revenue of $133.5 million, up 1.2% year over year and about $2.5 million higher than the average analyst estimate. Adjusted for currency effects, revenue was up 2.7%.
Product license revenue was down 3.6% to $30.1 million, while subscription services revenue rose 2.4% to $7.3 million. Product support revenue was $74.7 million, up 1.4%, while revenue from other services jumped 7.5% to $21.5 million.
"Our fourth quarter performance highlights increased customer adoption of our cloud offerings and our breakthrough HyperIntelligence product," said MicroStrategy CEO Michael Saylor in a press release.
Earnings per share came in at $1.18, up from $0.30 in the prior-year period and $0.35 higher than analysts were expecting. A big drop in operating expenses was responsible for most of the profit growth. Sales and marketing spending was down 13%, while research and development spending was down 7%.
MicroStrategy didn't provide any guidance, consistent with its past practices. However, chief financial officer Lisa Mayr did say during the earnings call that the company expects to deliver revenue growth in 2020 on a constant currency basis.
While MicroStrategy's revenue growth was sluggish in the fourth quarter, cost reductions did wonders for the bottom line. The positive earnings surprise was enough good news for investors to push up the stock.