Updated from 4:37 p.m. EDT

Business Objects ( BOBJ) handily beat Wall Street's top- and bottom-line expectations in the third quarter, as the business software company grew its operating income by 81% and raised full-year guidance. P/>The strong quarter sparked a modest after-hours rally, with shares of the Paris-based company gaining $1.36, or 4%, to $35.

On Thursday the company posted a profit of $19.5 million, or 21 cents a diluted share (and ADS), compared with $11 million, or 12 cents a share, in the same quarter last year. Total revenue increased by 19% to $261.4 million from $219.5 million, the company said.

The jump in revenue put Business Objects over the $1 billion revenue mark (on a trailing four-quarter basis) for the first time.

Revenue was above the company's guidance, while earnings were at the high end.

Excluding items, Business Objects earned a profit of 30 cents a share, 3 cents above Wall Street's expectations. Analysts polled by Thomson First Call were looking for $252.2 million in revenue.

Looking to the fourth quarter, the company now expects revenue to range from $287 million to $292 million. Earnings will range from 37 cents to 40 cents a diluted share on a non-GAAP basis. Analysts were projecting a 38 cent profit on sales of $282 million.

Software license revenue was up 14% to $120.3 million, while sales of core business intelligence products, including query, reporting and analysis, grew by 9% to $104.9 million.

CEO John Schwarz said on a conference call that his company's strong growth in license revenue, an indicator of new business, shows that Business Objects is stealing share from rivals Cognos ( COGN)and Hyperion ( HYSL).

Since the beginning of the year, shares of Business Objects have appreciated by about 40%, while shares of Cognos have slipped by 17% and those of Hyperion have gained 2%.

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