Big day for those interested in application software! On August 4, after reporting better-than-expected sales, an acquisition, and increased guidance for the year, Allscripts Healthcare Solutions (NASDAQ:$MDRX) saw its shares gain 12.4%.

What Does This Mean?

Before we get into any numbers, it’s important to clarify the following: The company’s IT software solutions are used by healthcare providers around the globe in order to manage patient care. And in the second quarter, the demand for these software solutions surpassed expectations within the acute-care market.

With this, the Chicago-based company posted GAAP revenue of $426 million, which is up 10% from 2016. Meanwhile, software delivery, support and maintenance revenue came in at $279 million on a GAAP basis. This is significant, as it is up 12% from 2016. Additionally, client-services revenue totaled $147 million on a GAAP basis. Recurring revenue – including subscriptions and support and maintenance – grew 11%.

Further, gross margin of 44% compared favorably to the 43.1% rate in 2016. At the same time, adjusted net income came in at $27 million and adjusted earnings per share was $0.15.

Not only that, Allscripts Healthcare disclosed that it would be purchasing McKesson Corporation’s (NYSE:$MCK) hospital and health-systems business for $185 million.

What Does The Future Hold?

Thanks to the solid quarter, Allscripts Healthcare led management to increase its sales outlook to between the range of $1.79 billion to $1.82 billion from prior guidance of $1.71 billion to $1.74 billion. This guidance is a clear reflection of the company’s expectation that it will close on its acquisition in Q4.

In addition, Allscripts Healthcare raised its compound annual-growth outlook for next year to 2020. Now, the company forecasts revenue growth to be between 9% to 11%.

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