Timber and wood products company Weyerhaeuser Co. said Friday its second-quarter loss widened as the slumping housing market suppressed demand for its building supplies.

The stagnant real-estate market has weighed on sales of the company's two-by-fours and other products used by home builders, resulting in losses in six of the last seven quarters.

But results easily beat Wall Street's expectations and shares rose in premarket trading.

The Federal Way, Wash., company lost $106 million, or 50 cents per share, compared with a loss in the year-earlier period of $96 million, or 45 cents per share.

Sales fell 36 percent to $1.39 billion from $2.17 billion a year ago.

Before one-time items, Weyerhaeuser lost $125 million, or 59 cents per share.

Analysts polled by Thomson Reuters expected, on average, for Weyerhaeuser to lose 71 cents per share on revenue of nearly $1.46 billion.

"Although we've begun to experience some recovery in housing sales and starts, it is not yet clear that this improvement is driven by sustainable shifts in market fundamentals, and therefore our timberlands, wood products and real-estate businesses continue to operate in an environment of uncertainty," CEO Dan Fulton said in a statement.

He also said Weyerhaeuser is cutting costs and adjusting harvest and production levels to match demand.

Longbow analyst Joshua Zaret said asset sales appear to have been key to the company's ability to beat earnings estimates.

"Things were better across the board with the exception of timberlands, which were substantially better on what appears to be timberland sales," he said. "And that probably accounts for most of their earnings beat."

"But they are still not out of the woods; we are not looking for a meaningful improvement in the third quarter because of the housing environment."

UBS analyst Gail Glazerman, who has a "Buy" rating on the stock, said she was encouraged that cash and cash equivalents rose $50 million, "given very difficult markets in the second quarter."

In morning trading, Weyerhaeuser shares rose $1.01 to $36.63.

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