Connected-home software provider Alarm.com (NASDAQ: ALRM) reported its second-quarter results after the market closed on Aug. 8. Both revenue and adjusted earnings grew at double-digit rates, and the company raised its full-year guidance despite uncertainty surrounding tariffs on Chinese goods. Alarm.com now sees roughly 10% revenue growth this year, up from the single-digit growth it expected in March. Alarm.com results: The raw numbers Metric Q2 2019 Q2 2018 Year-Over-Year Change Revenue $121.7 million $104.5 million 16.5% Net income $13.8 million $10.7 million 29% Non-GAAP earnings per share $0.40 $0.34 17.6% Data source: Alarm.com. What happened with Alarm.com this quarter? Software-as-a-service [SaaS] and license revenue was $82.3 million, up 15.9% year over year. This number includes software license revenue of $11.0 million, up 7.8% from the prior-year period. Hardware and other revenue was $39.3 million, up 17.3% year over year. Net income on both a GAAP and non-GAAP basis benefited from a $3.3 million reversal of an impairment charge recorded in the fourth quarter of 2018. Adjusted earnings before interest, taxes, depreciation, and amortization was $27.7 million, up from $23.4 million in the prior-year period. Total cash and cash equivalents was $150.9 million at the end of the quarter, up from $122.4 million at the end of the first quarter. This total includes a $7.4 million payment received related to a promissory note with a hardware supplier. Operating cash flow was $22.9 million, up from $11.7 million in the prior-year period. Free cash flow was $21.3 million, up from $8.6 million in the prior-year period. Alarm.com integrated new security panels during the quarter, as well as additional automation and lighting hardware. Image source: Alarm.com. What management had to say During the earnings call, Alarm.com CEO Stephen Trundle highlighted the company's success selling advanced services to its subscribers: "For the first six months of the year, the number of subscribers electing a video service plan is up about 40% from the first half of 2018. Adoption of our video analytics service, which we initially released at the end of last year, continues to grow as well." Trundle also explained that the company has been able to largely pass through tariff-related costs on its hardware: "But generally I think our service providers understand that this is not -- you look at the gross margins we run on hardware and you look at, which are intentionally low, and you look at this additional cost, and most are understanding that there is a new tariff cost, and as long as we call that out, we can pass through the bulk of it." Looking forward For the third quarter, Alarm.com expects SaaS and license revenue between $83.7 million and $83.9 million. The company didn't provide guidance for total revenue or any profitability metrics. For the full year, Alarm.com raised its guidance. The company now expects: SaaS and license revenue between $333.2 million and $333.7 million, up from a previous range of $331.3 million to $332.2 million Total revenue between $460.2 million and $465.7 million, up from a previous range of $447.3 million to $454.2 million. Hardware and other revenue is expected between $127.0 million and $132.0 million. At the midpoint, total revenue will be up 10% from 2018. Adjusted EBITDA between $101 million and $103 million, unchanged from the previous outlook. Non-GAAP earnings per share between $1.39 and $1.41, up from a previous outlook of $1.37 to $1.41. While tariffs on Chinese goods have created uncertainty for Alarm.com, the company felt confident enough after the second quarter to boost its revenue guidance and nudge up the low-end of its earnings guidance. 10 stocks we like better than Alarm.com HoldingsWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.* David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Alarm.com Holdings wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of June 1, 2019 Timothy Green has no position in any of the stocks mentioned. The Motley Fool recommends Alarm.com Holdings. The Motley Fool has a disclosure policy.Source