Activision Blizzard Inc. reported better-than-expected adjusted third quarter revenue, led by sales of the company's latest "Guitar Hero" video game. Its earnings met Wall Street expectations.

After Thursday’s market close, the Santa Monica company reported net income of $15 million (1 cent a share), compared with a net loss of $108 million (-8 cents) a year ago. Revenue fell 1 percent to $703 million.

Excluding one-time items, Activision earned 4 cents a share with adjusted non-GAAP revenue of $755 million. Analysts surveyed by Thomson Reuters on average expected adjusted results of 4 cents per share profit and revenue of $724 million.

Activision gave a conservative outlook for the current quarter because of the continued uncertain economy. The company forecast adjusted earnings of 43 cents a share on non-GAAP revenue of $2.2 billion. Analysts on average expect 44 cents a share on revenue of $2.3 billion.

Activision said so far it has been seeing strong sales in its music genre, led by its latest title, "Guitar Hero 5." The company next week is set to release the highly anticipated combat game, "Call of Duty: Modern Warfare 2."

“Even though there is a great deal of economic uncertainty in the marketplace and the consumer risks around the holiday season are high, we believe that our strong balance sheet and solid cash position, coupled with our leading franchises, operational capabilities and broad global reach will enable us to take advantage of the long-term opportunities afforded by our industry," Chief Executive Robert Kotick said in a statement.

Shares were up 49 cents, or 4.5 percent, to $11.36 in midday trading on the Nasdaq.