What: Shares of Blue Nile (NASDAQ:NILE) were up 10% as of 1:20 p.m. Thursday after the online jewelry specialist announced better-than-expected third-quarter earnings and renewed its share repurchase program.

So what: Quarterly revenue rose 4% year over year to $109.9 million, and translated to 17.6% growth in net income to $2.0 million, and a 21.4% increase in net income per diluted share to $0.17.

Analysts, on average, were anticipating higher revenue of $111.1 million to result in lower net income of $0.16 per share.

In addition, Blue Nile's board renewed the company's share repurchase program, authorizing it to buy back up to $100 million in common stock -- or nearly a quarter of its entire market cap as of this writing -- over the next 27 months.

Blue Nile CEO Harvey Kanter added, "Importantly, we expanded profitability while at the same time investing in initiatives to drive greater long-term growth. These initiatives, which include online and offline marketing and the Webroom concept, focus on building awareness and generating a greater level of trust for buying diamonds and fine jewelry online."

Now what: For the current quarter, Blue Nile anticipates revenue between $158 million and $168 million, and earnings per diluted share of $0.41 to $0.47. By comparison, analysts were modeling fourth-quarter revenue of $164.8 million, and earnings of $0.44 per share.

For the full fiscal year 2015, Blue Nile now expects revenue between $488 million and $498 million (representing a $7 million reduction from the high end of its previous range), and earnings per diluted share of $0.87 to $0.93 (a $0.04-per-share increase from the low end of its prior range). Still, both ranges were roughly inline with Wall Street's expectations. Consensus estimates called for fiscal 2015 revenue of $494.9 million, and earnings of $0.89 per share.

In the end, investors are rightly encouraged by this quarter's strong profitability, and the company's willingness to reward shareholders for their patience through an enormous repurchase plan. If Blue Nile continues to drive awareness for its brand as the world migrates online, this may well be the start of a much longer positive trend.

Steve Symington has no position in any stocks mentioned. The Motley Fool recommends Blue Nile. 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.