Overstock.com, Inc. (NASDAQ:OSTK) reported strong financial results for the first quarter that ended March 31, 2013. The stock price of  the company surged  more than 24 percent to $14.38 per share around 11:26 AM on Thursday in New York.

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The online discount retailer posted $312 million revenue, an increase of 19 percent compared with its $262 million revenue in the same period in 2012.

According to Overstock.com, Inc. (NASDAQ:OSTK) its revenue growth was primarily driven by a 21 percent increase in average order size and partially offset the decrease in customer orders.

Its net income was $7.7 million, and $0.31 diluted earnings per share, which is higher than its net income of $2.7 million and $0.12 diluted EPS in the same quarter a year ago.

During the first quarter, Overstock.com, Inc. (NASDAQ:OSTK)’s gross margin increased by 80 basis points from 18.1 percent to 18.9 percent. Its gross profit was $58.9 million, a 24 percent increase from $47.5 million recorded gross profit in the same quarter in 2012.  The online discount retailers’ gross profit was strong because it generated higher revenue from shifting its product mix into higher margin home and garden products. The company also incurred lower warehousing costs.

Overstock.com, Inc. (NASDAQ:OSTK) said its sales and marketing expenses increased by 29 percent from $14.5 million to $18.7 million. The online discount retailer explained that it poured more cash on sponsored search marketing because a substantial amount of its revenue is generated from it.

G&A / Technology expense also went up from $30.5 million to $33.2 million. According to the company, its technology expenses increased by 16 percent while its general and administrative expenses rose by 2 percent.

Overstock.com, Inc. (NASDAQ:OSTK) said its operating income for the quarter was $7.4 million and interest income was $34,000. The company restructured a credit of $432,000 as the company reoccupied some of its IT data space that was previously restructured. It recorded a charge of $98,000 and an interest expense of $51,000. The online retailer ended the quarter with $32.3 million free cash flow, and paid $46,000 income tax.

Earlier this week, Overstock.com, Inc. (NASDAQ:OSTK) announced that its CEO Dr. Patrick Byrne resumed his duties in the company after taking a medical leave of absence. In a statement, Byrne said, “It’s great to be back, and I look forward to serving our shareholders once more. I wish to extend my gratitude to Jonathan, who has done a fine job in my absence, and in my view is ready to start providing direction at a board level, while retaining executive responsibilities for a large section of the company.”