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Circuit City

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posted a sharply higher second-quarter profit, topping Wall Street's estimates, as the electronics chain continued to benefit from strong demand for flat-panel TVs and digital-audio products. The retailer also raised its sales targets for the full year.

Circuit City's earnings for the quarter ended Aug. 31 rose to $10 million, or 6 cents a share, from $1.3 million, or 1 cent a share, a year earlier.

Excluding a $1.3 million loss from discontinued operations in the latest quarter, Circuit City's earnings were 7 cents a share. Analysts polled by Thomson First Call had an average estimate for earnings of 5 cents a share.

The retailer's sales rose to $2.84 billion from $2.56 billion a year earlier, while same-store sales surged 8.3%.

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Among the chain's best-performing categories were televisions, which saw same-store sales growth in the double digits. The company, like its rival

Best Buy

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last week, noted strong same-store sales growth in flat-panel displays.

Circuit City also reported double-digit same-store sales growth for digital-imaging products, laptops, and portable digital-audio products, among other categories.

For the full fiscal year, Circuit City now expects same-store sales growth of 7% to 9%, up from a prior view of 5% to 7%. The company expects total sales to increase 9% to 11%, compared with its earlier target of 7% to 11%.