UPDATE 1-Applied Signal Q3 profit beats Wall Street

* Sees FY10 rev at lower end of prior view

* Sees FY10 oper income at higher end

* Q3 EPS $0.26 vs est. $0.22

* Revenue $56.4 mln vs est. $60.6 mln

* Shares down 3 pct in extended trade

Aug 31 (Reuters) - Applied Signal Technology Inc APSG.O posted a better-than-expected quarterly profit, helped by new development orders at its tactical wireless and network intelligence divisions, but said it expected fiscal 2010 revenue at the lower range of its prior outlook.

Applied Signal, a provider of communication interception gear, had previously forecast fiscal 2010 revenue of $223-$233 million.

The company, whose products are used by U.S. defense and homeland security agencies to intercept cellphone, microwave and military communication signals, said it saw fiscal 2010 operating income at the higher end of its prior outlook of $18-$21 million.

It said the forecast was based on expected effective tax rate of between 38-39 percent and assumed the R&D tax credit is extended.

For the third quarter ended July 30, Applied Signal reported net income of $3.6 million, or 26 cents a share, compared with $3.3 million, or 25 cents a share, a year ago.

Revenue rose 14 percent to $56.4 million. New orders increased by 21 percent to $62 million.

Analysts on average were expecting earnings of 22 cents on revenue of $60.6 million, according to Thomson Reuters I/B/E/S.

Shares of the Sunnyvale, California-based company were trading down about 3 percent at $19.00 after the bell.

The stock, which has gained about 11 percent in the past three months, closed at $19.62 Tuesday on Nasdaq. (Reporting by Megha Mandavia in Bangalore; Editing by Vyas Mohan)