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Game shares jumped Thursday, as Wall Street applauded

earnings from video-game publisher

Electronic Arts

(ERTS)

.

Electronic Arts said after the bell Wednesday that it earned $250 million, or $1.69 a share, in the third quarter, up from $132 million, or 92 cents a share, a year earlier. Sales rose 48% to $1.23 billion from $833 million in the same period last year.

The company's shares on Thursday afternoon gained 2.6% to $52.29.

Take-Two Interactive

(TTWO) - Get Take-Two Interactive Software, Inc. Report

jumped 2.6% to $20.78, while

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Activision

(ATVI) - Get Activision Blizzard, Inc. Report

added 2.4% to $14.85. Even

THQ

(THQI)

, which sent investors panicking in October after warning of slowing growth, gained 2.2% to $13.04.

"Sometimes you need to be hit over the head to feel comfortable with a particular company in a difficult environment," said Lehman Brothers leisure analyst Felicia Rae Kantor, referring to Electronic Arts, in a note to clients. "Consider us convinced." Kantor maintained a 2-equal weight rating, equivalent to a hold rating, and a $65 price target. The firm has no investment-banking relationship with Electronic Arts.

Separately, RBC Capital Markets games analyst Stewart Halpern upgraded his rating on Electronic Arts to sector outperform, and raised the price target by 3 cents, to $60.

But not everyone in the investment community was convinced. W.R. Hambrecht analyst Bill Lennan downgraded Electronic Arts stock to hold from buy on concerns over the company's calendar-year 2003 projections for several divisions. While the company largely has affirmed 2003 sales expectations, it has guided down sales in the PC and Nintendo divisions. PC games make up about 20% of the company's publishing revenue.

"I heard some subtle and not so subtle signals that I believe made me feel marginally more negative," said Lennan. "I was concerned the company took down projections for North American PC software from 5% to 8% growth, to 0% to 5% growth."