Investors got good news from Zynga on Thursday afternoon -- or at least some not-so-bad news.
Shares of the social gaming company surged 12% in after-hours trading Thursday after it reported third-quarter sales of $202.6 million, beating the analyst projection of $187.9 million. The company also posted a smaller-than-expected loss -- $16 million, or two cents a share, against a projection of four cents.
Zynga still faces a difficult road ahead, having struggled to replicate earlier successes like FarmVille and Words With Friends.
The company's daily active user total slipped 23% versus the second quarter to 30 million, and 49% versus a year ago. Monthly active users fell to 133 million, from 311 million a year ago.
Zynga ( CEO Don Mattrick said the company is "working hard to compete more aggressively on the web, move to mobile and develop new hits, and I am happy with the early progress we have made." )
The company raised hopes among investors last year by applying for an online gambling license, exploring a new potential revenue source. But Zynga dropped those plans in July, focusing on its core social gaming business.
Zynga has offered online gambling in the U.K. since April.