Sony shares spike on profit expectations

Sony Corp. is expected to announce its third-quarter earnings next Thursday, and investors appear to be optimistic about the results. Reuters reports today that shares in the Japanese electronics giant gained nearly 5 percent on the Tokyo Stock Exchange to close at ¥3,085 ($34). The bump came after the Japan's business daily Nikkei forecast that Sony will post a ¥100 billion ($1.1 billion) operating profit for its October-December quarter on the strength of its games and LCD TV segments.

Reuters notes that while Sony had been expected to break its five-quarter streak of operating losses during the period, Nikkei's forecast was substantially higher than previous market expectations. Thomson Reuters' analyst poll indicated that the electronics company would post a ¥74.2 billion ($826 million) operating profit during the quarter.

According to the Japanese business daily, Sony Computer Entertainment is expected to achieve third-quarter profitability thanks to surging PlayStation 3 sales in the wake of the introduction of the 120GB PS3 Slim. As part of its CES 2010 press conference, Sony said that it sold some 3.8 million PS3s worldwide during the five-week holiday period. The publisher has also seen strong performances from console exclusives, such as Infamous and Uncharted 2, both of which have surpassed the million-unit milestone.

Sony debuted the redesigned console in late August at the $299 price point--$100 less than the old model. The price cut was facilitated by Sony's ability to cut PS3 manufacturing costs by some 70 percent. However, an iSuppli report in December indicated that the publisher still loses $36 per console sold.

Nikkei also reports that Sony's bottom line has been buoyed by its sweeping restructuring efforts that resulted in a company-wide culling of 16,000 positions, as well as facility closures.