Electronic Arts Inc, the video game publisher known for its FIFA and Madden: NFL franchises, said its quarterly outlook and revenue rose, sending its shares about 3 percent higher.

For the first quarter, the company forecast earnings in the range of a loss of 44 cents to 49 cents per share, falling short of the Street's average estimate of a 36 cents loss.

This was a nice, strong quarter, but they are being conservative with their outlook, said Sterne Agee analyst Arvind Bhatia.

In the past, the company frustrated investors by slashing its earnings forecast, but analyst say it has cut costs, slimmed its game portfolio and begun issuing more cautious forecasts.

Investors have been pulling back from traditional game publishers that produce action and sports games people play on consoles and TV sets.

EA and its rivals are investing more in digital content and offering users options to play more inexpensive games on mobile devices and PCs. EA generated $833 million in digital revenue this year, or revenue that comes from games that are not part of its traditional packaged games business. This beat its own target of $750 million for the year.

We're taking significant market share in the digital video game industry overall, said Chief Financial Officer Eric Brown in an interview.

Brown added the company's digital business is growing faster than its overall business. One big digital seller was FIFA'11, which made more than $100 million in digital content, such as downloaded content and games on Facebook.

EA, like many video publishers, follows accounting rules that defer the revenue it generates from digital games until later quarters. Taking this into account, the company said its profit was $83 million, or 25 cents per share, in the fourth quarter up from $23 million, or 7 cents per share a year earlier. This 25 cents EPS beats analysts' average estimates of 22 cents.

EA's net income rose to $151 million, or 45 cents per share, in its fiscal fourth quarter, from $30 million, or 9 cents per share, a year earlier.

EA, the second largest video game publisher, said quarterly revenue was $1 billion, up from $970 million a year earlier.

EA shares rose to $20.50 after hours, up about 3 percent from the 419.92 close on Wednesday on the Nasdaq.

(Reporting by Liana B. Baker; editing by Steve Orlofsky and Andre Grenon)