Shares of enterprise software company Asana (ASAN 43.10%) absolutely skyrocketed on Friday after it reported financial results for its fiscal third quarter of 2025 -- results that had the investing world feeling quite optimistic about its future. As of 9:50 a.m. ET, Asana stock was up about 40% and hitting 52-week highs.

Could better growth be just around the corner?

Asana offers workplace management software. With it, its customers set goals and track progress. The company expected Q3 revenue of $180 million to $181 million. But it generated Q3 revenue of nearly $184 million.

Beating the top end of guidance by 1% seems incompatible with a 40% gain in Asana's stock price. But as you might have guessed, there's a little more to the story.

Since the company went public in 2020, Asana's growth rate has plunged at an alarming pace, as the chart below shows.

ASAN Operating Revenue (Quarterly YoY Growth) data by YCharts

However, with Q3 results, Asana's management highlighted the recent launch of its artificial intelligence (AI) product, AI Studio. In short, its customers love it and some are bypassing a pilot period and diving straight into a subscription. Investors are hopeful not only that this will reinvigorate Asana's growth, but also that it might even expand the company's addressable market. And these developments are what investors are celebrating today.

Looking ahead

In the upcoming fourth quarter, Asana's management expects to generate revenues of $187.5 million to $188.5 million, which would represent 10% year-over-year growth. That's the same as its growth rate in the second quarter and in Q3, which does suggest that its slowdown is reaching a bottom.

Asana has negative free cash flow of $10 million through the first three quarters of its fiscal 2025. But management expects positive free cash flow in Q4.

With a successful AI launch, stabilizing growth, and positive free cash flow on tap, investors are justified in their excitement about Asana stock today.