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By Gina Keating

LOS ANGELES, May 8 (Reuters) - Digital media company RealNetworks Inc (RNWK.O: Quote, Profile, Research) posted a lower net profit on Thursday but it beat its own forecast on higher sales of games and music technology products, sending its shares up as much as 10 percent in after-hours trade.

The company also said it plans to separate its casual games business into an independent company and distribute the shares to its shareholders, possibly preceded by an initial public offering of up to 20 percent of the new company.

Net profit in the first quarter was $2.4 million, or 2 cents per share, down from $39.9 million, or 22 cents per share, in the year-ago period.

Analysts were expecting a loss of 3 cents on that basis.

Revenue rose 14 percent to $147.6 million from $129.5 million.

Analysts, on average, had expected a profit, excluding items, of 2 cents per share and revenue of $141.5 million, according to Reuters Estimates.

RealNetworks forecast fiscal year revenue of $628 million to $648 million, including about $12 million from its acquisition of game company Trymedia.