LOS ANGELES (Reuters) – Video game maker Take-Two Interactive Inc (TTWO.O) on Thursday smashed Wall Street expectations for its fiscal third quarter and raised its forecast for the current fourth quarter, citing strong sales for its "Red Dead Redemption" title.

The company's shares rose 12.4 percent in after-hours trading.

The New York-based company raised its outlook for the fourth quarter and said it expects to be profitable for the full fiscal year, after previously forecasting a net loss.

"It's a hit or miss business and 'Red Dead Redemption' definitely played a big role in the turnaround," said Atul Bagga, an analyst with ThinkEquity LLC.

Take-Two Interactive confounded analysts who had expected the company to suffer without a game release tied to "Grand Theft Auto," its most popular franchise.

If the company can stay profitable this fiscal year, it will be the first time it has achieved an annual net profit without releasing a "Grand Theft Auto" game.

Strauss Zelnick, chairman of Take-Two Interactive, said the company must continue to release quality games.

"It's true of all entertainment businesses, as they begin to mature so called 'B' titles stop selling and even 'A-' titles stop selling and only 'A+' titles continue selling," he told Reuters in an interview.

"Red Dead Redemption" has sold 6.9 million units since its release in May. The franchise is about half as popular with gamers as its older cousin "Grand Theft Auto," Bagga said.

The company has not said when it will release the next "Grand Theft Auto" title.

"If they can again turn a profit in 2011 I think that will be a big boost for investor sentiment," Bagga said.

The company posted a net profit for the quarter ended July 31, of $5.9 million, or 7 cents per diluted share, compared with a net loss of $56.5 million, or 73 cents per share, in the year-ago period.

Excluding items, the company earned 28 cents per share, ahead of the average of analysts' estimates of a loss of 6 cents a share, according to Thomson Reuters I/B/E/S.

The company, best known for its top-selling "Grand Theft Auto" game franchise, posted net revenue of $354.1 million, more than triple its revenue of $94.9 million in the year-ago period.

For the fiscal fourth quarter ending on October 31, Take-Two forecast a profit, excluding items, of 20 cents to 30 cents a share. It raised its outlook from an earlier forecast of a fourth-quarter loss, excluding items, of 10 cents to 20 cents, citing continued strong sales of "Red Dead Redemption."

Analysts on average had expected a loss of 12 cents a share for the current quarter, according to Thomson Reuters I/B/E/S.

Shares of Take Two rose 12.4 percent in after-hours trading to $9.95 after closing 3.4 percent higher at $8.85 on Nasdaq.

(Reporting by Alex Dobuzinskis; Editing by Carol Bishopric)

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DETROIT – General Motors plans to start trading shares again on Nov. 18, timing that allows the company one more quarter of earnings to build its case to investors, a firm that researches initial public offerings said Thursday.

Scott Sweet, the managing partner of IPO Boutique, said GM plans to price the shares on Nov. 17 and begin selling them the next day. He said the automaker wants to start a two-week a road show to drum up investor interest on Nov. 3, the day after the midterm congressional elections.

It's unclear if the IPO dates have been finalized. Two people with knowledge of the process say the automaker's board hasn't approved a date for the IPO but is expected to meet next week to discuss the issue. GM is in a "quiet period" before an IPO, so no one is authorized to discuss the process publicly.

The company filed paperwork for an initial public offering with federal regulators last month. GM spokeswoman Renee Rashid-Merem declined to comment Thursday on the timing of the IPO.

Sweet said his information comes from multiple people on Wall Street but declined to name them. He says the company hasn't yet established a price for the shares, but hopes to raise $15 to $20 billion with the initial public offering.

The timing could disappoint some Democrats who supported the government's $50 billion bailout of GM last year and wanted to point to a successful IPO before the elections. But one more quarter of earnings could help the automaker establish that it is healthy and capable of making sustained profits. GM earned $2.2 billion in the first half of 2010 despite depressed U.S. auto sales, but it lost $3.4 billion in the fourth quarter of last year.

GM also hopes the U.S. auto market sees some modest improvement this fall. On Wednesday it said its U.S. sales fell 5 percent from July and 11 percent from last August, when they were boosted by the Cash for Clunkers program.

Dan Akerson, who became GM's CEO on Wednesday, didn't mention the IPO in his first e-mail to employees Thursday. Akerson wished employees a happy Labor Day weekend and said he has already met with United Auto Workers President Bob King. Akerson said he is "from a union family" and believes "very deeply" in working together with the union.

"There will always be more hard work ahead of us, but because of your dedication, I have great optimism for GM's future," Akerson said in the e-mail obtained by The Associated Press.

Akerson took over from Ed Whitacre, who has resigned as CEO but will remain chairman of GM through the end of this year. Both men are former telecommunications executives appointed to GM's board by the federal government.

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Discounts spur surprising Aug. retail sales gains

NEW YORK (AP) — This year's back-to-school season isn't as big a bust for retailers as they feared — or as last year's — but it's not great either.

Americans are spending only when the item and price are just right, according to August reports from major chains released Thursday that showed shoppers bought a little more than a year ago.

Analysts expect stores will need to keep discounting to get shoppers to spend this fall and for the holiday season while they grapple with job worries and tight credit.

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Data shows jobless claims drop, retail sales rise

WASHINGTON (AP) — A weak economy got a little lift Thursday with new data suggesting companies aren't pursuing mass layoffs and stores are a little busier.

New applications for unemployment benefits declined for a second straight week after rising in the previous three. Retailers reported surprisingly strong sales in August. And more people signed contracts to buy homes.

Economists were mildly encouraged by the news, which followed several downbeat reports on housing and weaker economic growth last week. But few saw signs that the economy is gaining momentum.

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Second Gulf spill puts moratorium back in question

NEW YORK (AP) — Just when America's ban on offshore exploration seemed like it might end, another disaster in the Gulf of Mexico put Big Oil back on the defensive.

An offshore production platform owned by Mariner Energy Inc. caught fire Thursday morning about 200 miles west of BP's blown-out well. The incident raised more doubts in Congress about the risks of offshore drilling.

The Obama administration had been mulling a quick end to its drilling moratorium, now that BP has brought its leaking well under control. White House spokesman Robert Gibbs said the Mariner explosion shouldn't affect a decision on the ban, and he would not link it with BP's well.

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Burger King sets sights overseas after $3.26B sale

CHICAGO (AP) — Burger King's new ruler could help its empire expand.

Burger King Holdings Inc. sealed a deal Thursday to sell itself for $3.26 billion to 3G Capital, an investment firm with strong ties to Latin America. The fast-food chain's chairman and CEO, John Chidsey, said the deal will help it expand more rapidly overseas.

Chidsey, who will become co-chairman of the company after the tender offer is complete, said the $24-per-share deal also brings 3G Capital's experience and contacts abroad.

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Stocks move higher following jobs, housing reports

NEW YORK (AP) — Stocks rose Thursday, extending their gains from the day before, after reports on housing, manufacturing and jobs all indicated that the economy continues to grow.

The Dow Jones industrial average rose 50 points, having jumped 254 on Wednesday thanks to strong reports on manufacturing in the U.S. and China. Broader indexes also rose.

Trading was somewhat muted ahead of the government's closely watched monthly report on employment due out Friday.

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Dell cedes data-storage maker 3Par to HP

SEATTLE (AP) — Dell Inc. is walking away from a bidding contest with rival Hewlett-Packard Co. for data-storage maker 3Par Inc.

Dell said Thursday it won't match HP's offer to pay $33 per share for 3Par, or about $2.07 billion. Dell's decision came barely an hour after 3Par announced it had received Dell's revised offer of $32 per share and then the even stronger bid from HP.

In a statement, 3Par said Dell's revised offer contained new terms that it found unacceptable, including a multiyear reseller agreement with Dell that would remain in effect even if 3Par were to be bought by another company.

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Bernanke: Shut down banks if they threaten system

WASHINGTON (AP) — Federal Reserve Chairman Ben Bernanke told a panel investigating the financial crisis that regulators must be ready to shutter the largest institutions if they threaten to bring down the financial system.

Bernanke also said while testifying before the Financial Crisis Inquiry Commission that it was impossible for the Fed to rescue Lehman Brothers from bankruptcy in 2008 because the Wall Street firm lacked sufficient collateral to secure a loan. Lehman's former chief executive told the panel a day earlier that the firm could have been saved, but regulators refused to provide help.

The Fed chief presented his analysis of the crisis and views on potential systemwide risks as the panel approaches the end of its yearlong investigation into the Wall Street meltdown.

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More Dems buck plan to let taxes increase for rich

WASHINGTON (AP) — Congress seems increasingly reluctant to let taxes go up, even on wealthier Americans.

Worried about the fragile economy and their own upcoming elections, a growing number of Democrats are joining the rock-solid Republican opposition to President Barack Obama's plans to let some of the Bush administration's tax cuts expire.

Democratic leaders in Congress still back Obama, but the willingness to raise taxes is waning among the rank and file as the stagnant economy threatens the party's majority in the House and Senate.

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Oh snap! New baby carrot campaign mimics junk food

NEW YORK (AP) — Baby carrot farmers are launching a campaign that pitches the little, orange, crunchy snacks as daring, fun and naughty — just like junk food.

A group of 50 producers hopes the 'Eat 'Em Like Junk Food' effort starting next week will double the $1 billion market in two or three years.

The goal is to get people to think of baby carrots as a brand they can get excited about — not just a plain, old vegetable. A website, http://www.babycarrots.com, features metal music and deep male voices chanting "Baby. Carrots. Extreme." On social networking site Twitter, the campaign's account suggests people eat them "like there's no tomorrow (maybe there won't be...)"

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By The Associated Press

The Dow Jones industrial average rose 50.63, or 0.5 percent, to close at 10,320.10.

Broader indexes also rose. The Standard & Poor's 500 index rose 9.81, or 0.9 percent, to 1,090.10, while the Nasdaq composite index rose 23.17, or 1.1 percent, to 2,200.01.

Benchmark oil for October delivery rose $1.11 to settle at $75.02 a barrel on the New York Mercantile Exchange.

Natural gas for October delivery lost 1.1 cents to settle at $3.751 per 1,000 cubic feet.

In other Nymex trading in October contracts, heating oil added 2.12 cents to settle at $2.0623 a gallon and gasoline gained 3.25 cents to settle at $1.9216 a gallon.

In London, Brent crude rose 58 cents to settle at $76.93 a barrel on the ICE Futures exchange.

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