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Newly public Pivotal Software Inc. today reported strong results in its first quarter peeking out of the nest of majority owner Dell Technologies Inc.

The company, which makes software for building cloud computing applications, reported a net loss in its fiscal 2019 first quarter of $32.5 million, or 31 cents a share, down from a $51.5 million or 76 cents a year ago.

Before certain costs such as stock compensation, the loss was 10 cents a share, down from a 20-cent loss a year ago. Revenue rose 28 percent from a year ago, to $155.7 million. Analysts had expected an adjusted loss of 13 cents a share on revenue of $140.4 million.

More important, revenue from subscriptions, a steadier, more predictable and more profitable stream of revenue than traditional software, jumped 69 percent, to $90.1 million. And subscription customers hit 339, up 20 percent from a year ago.

Pivotal also issued a new forecast, say subscription revenue would be $92 million to $93 million in the current quarter and revenue would be between $157 million and $159 million, with an adjusted loss of 9 to 10 cents. For the full fiscal year, it called for subscription revenue ranging from $380 million to $384 million, total revenue from $642 million to $649 million and an adjusted loss of 37 to 39 cents. Analysts were forecasting a 45-cent loss on sales of $622 million, according to a survey by FactSet.

All this cheered investors, as shares jumped more than 7 percent in after-hours trading, following a 1.3 percent uptick in the regular session, to $21.21 a share. Update: They liked it even better on Wednesday morning, when shares were jumping more than 26 percent.

“It’s been a great start to our fiscal year,” Chief Executive Rob Mee (pictured) said on the earnings conference call. “We believe we are well-positioned to disrupt some of the largest areas in IT investment as we help enterprises across industries transform.”

Pivotal went public on April 20, raising $497 million in the IPO, part of an ongoing parade of offerings by enterprise software companies this year. Dell still owns 70 percent of Pivotal’s shares and controls nearly 96 percent of its voting power, which may limit the kinds of investors interested in the shares because Dell must OK big decisions the company makes.

Indeed, the IPO itself was widely viewed partly as a way for Dell pay off a little more of the massive debt it incurred from buying EMC, though not immediately since the money raised will stay with Pivotal. “This is about Dell continuing to de-lever so they can pay down the debt,” longtime analyst and SiliconANGLE Media Inc. co-Chief Executive Dave Vellante said recently.

Still, the company’s business itself clearly remains strong as its Cloud Foundry software continues to be a leader in the segment of cloud computing known as platform as a service. It also has a service operation called Pivotal Labs. Pivotal Chief Financial Officer Cynthia Gaylor noted that gross profit margin in the first quarter was 64 percent, up 10 points from a year ago, thanks to the higher subscription revenues, which have a 92 percent margin.

Mee called out new customers, in particular the ticket marketplace StubHub, which is using Cloud Foundry to build applications faster and reduce costs as it uses Google’s public cloud. Another new customer is Dick’s Sporting Goods. Current customers such as West Corp. and Garmin Ltd. also expanded their use of Cloud Foundry.

Pivotal was founded by Mee in 1989 as a software consultant. In 2012, it was acquired by storage giant EMC, which combined it in 2012 with Greenplum Inc., the data warehouse provider EMC had acquired in 2010. In 2015, Mee took over the CEO spot again, and when Dell bought EMC, the former became the majority owner in Pivotal.

Dell CFO Tom Sweet provided some analysis of Pivotal’s IPO in the context of Dell in a recent interview with theCUBE, SiliconANGLE’s video studio:

Photo: Pivotal Software