Imagery from DigitalGlobe's various satellites. Image source: DigitalGlobe.

What: Shares of DigitalGlobe (NYSE:DGI) rose as much as 22.8% early Thursday, then settled to trade up 14.5% as of 11:30 a.m. ET after the satellite image specialist released stronger-than-expected first-quarter 2016 results.

So what: Quarterly revenue climbed 3.5% year over year, to $175.4 million, while net income came in at $7.3 million, or $0.11 per share, compared to a loss of $5.9 million, or $0.08 per share, in the same year-ago period. Adjusted EBITDA rose 30.5% year over year, to $95.4 million. Analysts, on average, were modeling a $0.06-per-share net loss on revenue of just $166.5 million. 

Within the top line, U.S. government revenue fell an expected 3.9%, to $110.3 million, as DigitalGlobe realized the deferred revenue earn-out on prior Global Enhanced GEOINT Delivery awards in last year's first quarter. And Diversified Commercial revenue climbed 19.2%, to $65.1 million, notably driven by a 35% increase in revenue from Direct Access Program (DAP) customers, to $33.2 million. 

Meanwhile, DigitalGlobe's per-share earnings were bolstered by both its continued focus on operating efficiencies and its decision to repurchase just over 4.1 million shares during the quarter for $60.9 million, or an average price of $14.80 per share. 

Now what: In addition, keep in mind DigitalGlobe is preparing for the Sept. 2016 launch of its new WorldView-4 satellite, for which the company also incidentally announced yesterday a three-year letter of intent from a new international defense and intelligence customer. That brought the value of contracts and letters of intent for both WorldView-3 and WorldView-4 to $355 million, which in turn should increase annualized contract revenue by $43 million with the vast majority set to begin next year.

In the meantime, DigitalGlobe also reiterated its full-year 2016 outlook, which calls for revenue of $670 million to $700 million, and adjusted EBITDA of $330 million to $355 million. During the subsequent conference call, CFO Gary Ferrera noted that "some" of the increase in DAP revenue in Q1 can potentially be credited to orders pulled forward from the current quarter.

Nonetheless, this was as good a quarterly report as DigitalGlobe investors could reasonably expect, and it's no surprise to see shares trading up nicely today.

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