What happened

Shares of Smartsheet (SMAR -2.58%) were climbing today after the software-as-a-service company posted better-than-expected results in its third-quarter earnings report.

As a result, the stock was up 18.2% as of 10:17 a.m. ET.

So what

Smartsheet, which makes a collaborative work platform, said that revenue in the quarter jumped 38% to $199.6 million, which topped analyst estimates at $194.3 million.

That growth was driven by a 129% net revenue rate, which shows that existing customers increased spending by 29% in the past four quarters. Additionally, the number of its highest-value customers, which generate annual contract value of at least $100,000, jumped 55% to 1,346, showing the company's momentum with its largest customers. Smartsheet already serves 80% of the Fortune 500, so expanding contracts with large companies may be the biggest key to its growth. 

On the bottom line, the company's adjusted operating loss expanded slightly from $2.7 million in the quarter a year ago to $4.3 million, and its adjusted loss per share narrowed from $0.03 to $0.01, easily beating the analyst consensus of a $0.15 loss.

CEO Mark Mader said, "In the current challenging macro environment, customers are turning to Smartsheet to help execute more strategically and efficiently, and are realizing a rapid return on investment. Looking ahead, I am confident in our ability to continue to unlock significant value for our customers, and generate durable, long-term growth with improving profitability."

Now what

Smartsheet also raised its guidance for the full year and offered a better-than-expected Q4 forecast. 

For the current quarter, the company called for 30% to 32% revenue growth to between $205 million and $207 million, ahead of the consensus at $204.4 million. On the bottom line, it sees an adjusted per-share loss between breakeven and $0.02 a share, which compares with estimates of a $0.09 per-share loss.

The market is typically going to be pleased with a beat-and-raise quarter, but given the macro headwinds in the software sector, the update from Smartsheet looks especially impressive.