RealNetworks to Spin-Off Fast Growing Games Unit

The company also announced its first quarter earnings, beating analysts' expectations.

Net income for the first three months of 2008 was 2.4 million, or 2 cents per share, compared with $40.0 million, or 22 cents in the year earlier period. The results included a $61 million payment related to the company's antitrust settlement and commercial agreements with Microsoft.

Analysts polled by Thomson Financial had expected a 3 cents per share loss.

Sales were up 14 percent to $147.6 million, compared with $129.5 million in the first quarter a year ago.

The games unit had 33 percent growth to $31.8 million. Music grew 12 percent to $38.1 million. Technology products and solutions grew 15 percent to $51.3 million due in part to acquisitions of SnoyNetServices and Exomi. Media Software and Services revenue was $26.4 million.

The company had about $539.6 million in cash, cash equivalents and short term debt and $100 million in convertible debt.

Shares of Real Networks rose 10 cents today, or 1.57 percent, to end the day at $6.48.