Also these statements are based solely on the present information and are subject to risks and uncertainties that can cause actual results to differ materially from those projected in the forward-looking statements. Please refer to our Form 10-Q, Form 10-K and other filings with the SEC and the risk factors contained therein. Also, please note that a replay of today's webcast will be available in the Investor Relations section of our website at www.prospricing.com.
I would also like to point out that the company's use of non-GAAP financial measures is explained in today's earnings press release, and a full reconciliation between each non-GAAP measure in the most directly comparable GAAP measure is provided in the tables accompanying the press release distributed early today and can also be found on our web site, in the investor relation section.
With that, I would like to turn the call over to Bert.
Bert WinemillerThank you, Charlie, and to those of you listening to our call. We continue to make great progress on our strategic initiatives that are positioning us to capitalize on the large, long-term market opportunities for our high return on investment enterprise, pricing and margin optimization software products. We're very pleased with our financial performance in the third quarter of 2010. This performance is a clear indication of the recognition of the power of pricing and PROS' ability to develop high-value software products. The following are our non-GAAP results. For the third quarter we are reporting revenue of $18.8 million. In addition to exceeding the high end of our revenue guidance, this was our fourth quarter of sequential revenue growth and also represented double-digit year-over-year revenue growth. Operating income was $2.4 million for the third quarter, which also exceeded the high end of our guidance while we continued to make strategic investments. Sales activity continues to increase and we are pleased that awareness of the power of PROS' science-based pricing and margin optimization software continues to reach a growing audience.