What: Alarm.com (NASDAQ:ALRM), which offers a multi-tenant software-as-a-service platform for connected homes, surged as much as 22% on Wednesday after the company reported better-than-expected third-quarter results. But the day's gain has pulled back to 17% at the time of this writing.

Alarm.com platform. Image source: Alarm.com.

So what: Going into Alarm.com's third quarter, analysts were expecting the company to post non-GAAP EPS of $0.04 and revenue of about $45 million. But the company's results were much better, with non-GAAP EPS and revenue of $0.14 and $54 million, respectively. Management cited "robust" performance in its core security and smart home services market in North America.

Another factor that may be contributing to the market's optimistic response is management's decision to increase its guidance for the full year. Alarm.com's full-year outlook for revenue was increased from a range of $193.9 million to $195.3 million to a range of $197.7 million to $200.1 million.

Now what: Following both a significant rise in the stock price and a better-than-expected quarter, it may be wise for investors interested in the company to look over its complete third-quarter earnings release, as well as listen to a recording of the company's third-quarter earnings call.