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NEW YORK (TheStreet) -- Zynga (ZNGA) , best known for the popular Facebook (FB)  game FarmVille, was gaining Friday on better-than-expected third-quarter results that reflected growth from its widening portfolio even as the company operates in the red. Shares were rising 13% to $3.99 in mid-day trading.

For the three-month period ended Sept. 30, the social-gaming company reported a third-quarter loss of 2 cents a share, beating Thomson Reuters estimates by 2 cents. Revenue totaled $152.1 million, 41% lower than the same period a year earlier but beating estimates by $9.4 million.

The San Francisco-based company continues to show growth after announcing it would refocus operations on core franchises. By the end of the quarter, Zynga had 3 of the top 10 games on Facebook based on daily average users.

"Our teams are working hard to compete more aggressively on the web, move to mobile and develop new hits," said CEO Don Mattrick in a statement. "We believe our top franchises -- Zynga Poker, FarmVille and Words With Friends -- can be evergreen in terms of consumer interest and we are focused on growing these franchises in fiscal year 2014."

Come the New Year, this will remain a challenge as engaged-users is expected to fall. DAUs dropped to 30 million, down 49% on the year-ago quarter and 23% quarter-by-quarter. Monthly active users (MAUs) were 57% lower to 133 million on a year-on-year basis, and down 29% since the second quarter 2013.

Costs were kept in check, however, as the company completed restructuring efforts. Lay-offs affected 520 positions or 18% of total global workforce during the quarter.

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"We are dedicated to improving employee efficiency by leveraging smaller, more focused teams on new intellectual property and redeploying talent through our largest franchises," explained CFO Mark Vranesh in a conference call.

The company also announced it had hired Clive Downie, former executive of mobile gaming company DeNA Co, as its new chief operating officer in a play to expand mobile reach.

For the fourth-quarter, the company forecasts revenue between $175 million and $185 million, and earnings loss between 5 and 4 cents, below Yahoo! Finance estimates of a 3-cent loss.

TheStreet Ratings team rates Zynga Inc as a Sell with a ratings score of D. The team has this to say about their recommendation:

"We rate Zynga Inc (ZNGA) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been weak operating cash flow."