In Sony’s gaming unit, lower production costs for the PlayStation 3 game console and higher unit sales of software like the latest game in its popular Gran Turismo car racing series helped increase profit.  But its liquid-crystal display TV business is struggling amid strong competition from rivals like Samsung, LG and Panasonic that is driving down prices. As a result, operating profit from Sony’s TV business decreased even though unit sales increased.  Sony slashed its forecast for TV sales for the full year through March to 23 million units, down from a previous forecast of 25 million. It kept its forecast for PlayStation 3 game console sales intact at 15 million units.  Sony Pictures also struggled to increase profit despite hit movies like “The Social Network,” which is loosely based on the story of Facebook and its co-founder Mark Zuckerberg. Although performance at the movie unit has been strong, it could not beat revenue from the previous year, which included the theatrical release of “This Is It,” the documentary on Michael Jackson.  Sony said sales for the quarter fell 1.4 percent, to 2.21 trillion yen, primarily because of a strong yen, which erodes the value of overseas earnings in the home currency. The company lowered its full-year revenue forecast to 7.2 trillion yen, from 7.4 trillion yen.  In the last three months of 2010, the yen was almost 9 percent stronger against the dollar and 19 percent stronger against the euro compared with a year earlier.  Sony’s chief financial officer, Masaru Kato, stressed that the effects of the strong yen were masking what he called a strong recovery in the company’s main electronics business. Sony plunged to losses of over 200 billion yen after the financial crisis as global demand for Japanese electronics evaporated.  “The strong yen continues, but I think we are seeing quite a strong rebound in electronics,” Mr. Kato said at a news conference.  Overtaken by rivals in areas it once dominated, including TVs and portable music players, Sony has in recent years sought to return to the cutting edge with an online strategy that would better marry its universe of gadgets with its extensive catalog of music, video and gaming content.  The company introduced a successor to the PlayStation Portable game console at an event in Tokyo last week and said it would also open up its catalog of PlayStation games to selected smartphones. That was a much-anticipated move that could help Sony fend off increasing competition from the likes of Apple, which has made rapid inroads into gaming with its App Store, packed with games that can be downloaded onto the iPhone and iPod Touch.  A version of this article appears in print on February 4, 2011, on Page B3 of the New York edition with the headline: TV Prices Still Falling, Sony’s Profit Drops 8.6%. Order Reprints| Today's Paper|Subscribe
Sony’s net income reached $885.6 million, hurt by a strong yen and ever-intense competition in the global flat-panel TV market.