Updated from 7:42 a.m. EDT

Eli Lilly ( LLY) released third-quarter earnings that beat Wall Street estimates even as its best-selling product continued to slip in the U.S. market.

Lilly also issued fourth-quarter and full-year earnings guidance that's within the range of financial analysts' consensus estimates. Lately, Lilly's stock was off 34 cents to $51.26.

The profit for the three months ended Sept. 30 rose to $794.4 million, or 73 cents a share, from $755.2 million, or 69 cents a share, last year. Sales rose 10% from the year-ago period to $3.60 billion, Lilly said Thursday.

On average, analysts had been forecasting earnings of 71 cents a share in the latest quarter on sales of $3.62 billion.

For the fourth quarter, Lilly put earnings at 73 cents to 79 cents a share, excluding one-time items, compared with the Thomson First Call consensus estimate of 76 cents a share.

Lilly predicted full-year earnings of $2.80 to $2.86, excluding special items. The consensus is $2.82. If items are included, the Indianapolis-based drugmaker says full-year earnings will be $1.90 to $1.96.

The company had a "decent quarter," says Tim Anderson of Prudential Equity Group in a research note, even though sales fell below his $3.7 billion prediction. He maintains his neutral rating. He doesn't own shares, and his firm doesn't have an investment banking relationship.

"Major products were roughly in line with our view," says James Kelly of Goldman Sachs. Kelly adds that he's concerned about "prescription weakness" in several big products. Kelly has a neutral rating on the stock. He doesn't own shares, but his firm has had a recent investment banking relationship with Lilly.

One product on Kelly's worry list is the schizophrenia drug Zyprexa, which accounted for 29% of Lilly's third-quarter revenue. U.S. sales declined 10%, but foreign-market sales rose 14%, giving Zyprexa a worldwide sales gain of 1% to $1.04 billion.

During the second quarter, Zyprexa's worldwide revenue fell 10%, including a 21% drop in the U.S. The company says worldwide sales will decline slightly for the full year.

Analysts questioned executives about their Zyprexa prediction, given that Lilly cited two events as helping the drug. One was the second-quarter settlement related to past marketing practices, for which Lilly took a $1.07 billion pretax charge. The other was a federally financed study, issued last month, that showed Zyprexa had better efficacy vs. several brand-name competitors even though it had more side effects.

John C. Leichleiter, Lilly's president and chief operating officer, said the comparison of schizophrenia drugs was "a very positive development" for Zyprexa. "But these things don't turn on a dime," he said. Although Lilly won't see changes in prescription patterns quickly, Leichleiter didn't offer a timetable.

Sales of Strattera, a treatment for attention deficit hyperactivity disorder, or ADHD, fell 14% to $140.9 million because of declining demand. Strattera is the only nonstimulant in the ADHD market, but despite a strong start, the drug has been hurt by the strengthening of its label in December to warn patients about potential liver problems.

Last month, the Food and Drug Administration told the company to add a "black box" warning, the strictest FDA alert, to the drug's label, referring to reports of suicidal thinking among children and adolescents. Analysts predict sales could be harmed. Leichleiter said it was too early to determine the impact of the new label.

Third-quarter revenue was aided by several veteran drugs -- the diabetes franchise, for example, gained 13% to $652.8 million vs. the same period last year -- as well as several newer drugs.

Sales of the antidepressant Cymbalta rose 13% to $182.8 million, although analysts say U.S. prescription growth has flattened in recent months. The lung cancer drug Alimta posted a 10% gain to $122.3 million, and the osteoporosis medication Forteo advanced 77% to $102.6 million.

The impotence drug Cialis recorded a 27% gain in worldwide sales to $195.1 million. Lilly has a marketing agreement with the drug's developer Icos ( ICOS).

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