Image source: Flotek Industries.

What: Flotek Industries Inc. (NYSE:FTK) reported earnings on Tuesday and the market was pleased with what it saw, sending shares as much as 18% higher in trading Wednesday. As of 12:50 p.m. ET, shares had settled to an 8.5% gain.

So what: First-quarter revenue fell 12.2% to $72.3 million, but when you consider the 57.8% decline in drilling rig count, that's not all bad. In addition, CnF revenue jumped 138% from a year ago, so the company's products are resonating with customers.  

The bottom line didn't look great with a $4.6 million loss from continuing operations, or $0.08 per share, but it's tough for anybody to make money in the energy business these days. The fact that loss from continuing operations weren't even bigger may be a good sign long term.

Now what: What had investors excited were the revenue number and CnF outperforming the market as a whole. That bodes well for the company if the energy industry ever picks up again.

Speculating on shares today is a big bet that demand will pick up in the shale space long term. That's a risky bet, but if it does, Flotek looks like it will be one of the biggest winners for investors.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.