Energy intelligence software provider EnerNOC (NASDAQ:ENOC) announced third-quarter results after the closing bell today. The company reported strong financial results, with revenue and free cash flow both up double digits over last year's third quarter. Let's take a closer look.

A look at the numbers
EnerNOC reported revenue of $329.4 million, along with net income of $96 million, or $3.11 per share. Non-generally accepted accounting principles earnings were slightly better, as net income was $103.2 million, or $3.31 per share. While revenue was up 18.3% over last year's third quarter, net income was down 15.9% per share on a GAAP basis and 15.1% on a non-GAAP basis.

Revenue was also much stronger than the company's own guidance of $313 million-$323 million; however, earnings fell short of guidance on both a GAAP and non-GAAP basis, and missed analysts expectations by $0.02. Free cash flow growth was strong as the company delivered $17.3 million in free cash flow, which is 11.4% higher than last year's third quarter. 

The company also used its balance sheet to raise $160 million in convertible debt. EnerNOC used a portion of those proceeds to buy back $30 million in stock last quarter, and now has a $246 million war chest of cash for acquisitions or additional capital returns to investors.

Operationally, the highlight this past quarter was strong subscription sales as the company signed subscription contracts with 200 enterprise customers for 2,000 additional sites. This brought the company's customer base up to 35,300 sites. One of the key additions was a new deal with Boston Properties (NYSE:BXP), which expanded the deployment of the company's energy intelligence software to include utility bill management across 180 properties representing 46.6 million square feet of office space.

A look at outlook
As a result of the company's third-quarter financial results EnerNOC has issued new guidance for the full year. The company is boosting its full-year revenue guidance from $450 million-$465 million to $465 million-$470 million. However, earnings guidance is being dropped from $0.47-$0.55 on a GAAP basis to $0.40-$0.45. On a non-GAAP basis, earnings will be $1.29-$1.35 per share as opposed to the $1.36-$1.45 per share the company previously had guided.

Still, EnerNOC continues to grow its customer base and revenue through its sales force, as well as through acquisitions. In fact, just two days ago, EnerNOC announced the acquisition of World Energy Solutions (NASDAQ:XWES), which is a leading cloud-based energy intelligence software provider. That deal is expected to add about $30 million per year in recurring revenue from its more than 4,000 customers when it closes early next year, while boosting earnings by 2016.

Investor takeaway
EnerNOC delivered strong revenue growth in the quarter. While earnings came in a bit short, the company is growing free cash flow. It's using that cash flow, along with its balance sheet, to put it in a better position to grow profits in the future, as it's making growth-focused acquisitions that will power a surge in future revenue and earnings.

Matt DiLallo has no position in any stocks mentioned. The Motley Fool owns shares of EnerNOC. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.