Music download service Napster (NASDAQ: NAPS) said Tuesday that it expects to report quarterly results that are ahead of its prior guidance.

When the firm releases results for its fiscal fourth quarter, which ended March 31, it now anticipates reporting more than $28 million in revenue. On February 8, the online music retailer said it expected revenue to exceed $26 million.

The firm said total subscriber base, including Japanese customers is now 830,000. The firm had reported 566,000 subscribers at the end of 2006.

The Los Angeles-based company said it added over 40,000 subscribers in the latest quarter. As part of a deal with AOL, the firm said it also successfully integrated over 225,000 AOL Music Now paid subscribers onto the Napster service.

As a result, the firm believes it is now the largest on demand music subscription service in the industry.

Shares jumped 14 cents, or 3.4 percent to $4.29 on the Nasdaq Stock Market in mid-day trading.

The firm expects to release fourth quarter financial results on May 16.

Software