What: Shares of Universal Display Corporation (NASDAQ:OLED) rose as much as 18% early Friday, and settled to trade up around 14.6% as of 12:20 p.m. after the OLED specialist reported better-than-expected third-quarter results and narrowed its full-year guidance.

So what: Quarterly revenue rose 19.8% year over year to $39.4 million, and translated to a 62.8% increase in net income to $7 million, or $0.15 per diluted share. Analysts, on average, were only expecting earnings of $0.08 per share on revenue of $38.3 million.

More specifically, Universal Display's top-line growth was driven by a 24% year-over-year increase in material sales, but partly held back by a 3.7% decline in royalty and license sales. On the latter, keep in mind this quarter's royalty and license results don't include a twice-per-year, $30 million payment from Samsung (NASDAQOTH:SSNLF) (up from $25 million last year) which arrives in the second and fourth quarters of each year. In addition, recall LG Display (NYSE:LPL) signed its own long-term agreement with Universal Display earlier this year to secure more attractive average selling prices, and now pays running royalties to Universal Display on sales of licensed OLED products. License and royalty revenue recognized from both customers should continue to rise over time as they ramp their respective OLED production efforts.

"We are pleased to report strong revenues, operating income and earnings in the third quarter as demand increased from customers, due to higher fab utilization rates and new capacity coming online," added Universal Display CEO Sid Rosenblatt. "Overall, we are encouraged by the robust global OLED pipeline, from leading panel manufacturers investing in additional OLED capacity to deliver bright, thin, beautiful, high resolution displays to consumers on a broader scale to OEMs around the world designing OLED panels into their new consumer electronic products."

Now what: Universal Display also narrowed its 2015 guidance to $200 million, plus or minus 3%. Previously, Universal Display called for full-year revenue of $200 million, with a downside range of 5% and "upside potential" of 15%.

For perspective, analysts' consensus estimates already called for for 2015 revenue of $200.3 million, and this new guidance range is a relief for many investors who worried that recently reduced OLED TV unit targets from LG Display would sway near-term results to the lower end of its previous guidance range. In the end, given Universal Display's solid quarterly beat and those worries proving largely unfounded, it's no surprise the market is bidding Universal Display stock up today.

Steve Symington owns shares of Universal Display. The Motley Fool owns shares of and recommends Universal Display. 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.