Sony (SNE) is finally recovering in its core consumer electronics business.
Just a year ago, the Japanese tech giant faced a massive recall of 9.6 million lithium-ion laptop batteries. Its PlayStation 3 video game console business has been losing money, while rival Nintendo's Wii console has sold out at many stores and captured a new nongamer audience, such as senior citizens.
But analysts say the tide is turning this Christmas season. Sony's Bravia, a high-definition TV with liquid crystal display, is increasing its U.S. market share, says Masahiro Ono, an analyst at Morgan Stanley.
Sony ranked No. 2 after Samsung in LCD TV global market share by sales in November, according to Display Search. Sony doesn't disclose holiday-season sales figures, but Ono predicts it will soon surpass rival Samsung to claim the No. 1 spot.
Aggressive discounting seems to be paying off. Best Buy (BBY) cut the price of the popular 40-inch Bravia by 10% to $2,249 between October and November. More importantly, Sony got its hands on LCD panels when rivals like Panasonic struggled to find them.
"Whoever gets panels wins the game," Ono said.
Sony's TV business in the second quarter, which ended Sept. 30, still showed a $181 million loss. Discount LCD TV maker Vizio outpaced all rivals by units sold in the U.S. But Sony's strong sales of Cybershot digital cameras, camcorders and Vaio PCs offset the loss.
The company's earnings for the second quarter rose from barely profitable a year ago to $641 million, or 61 cents per U.S. share, beating views. Operating income in the electronics division jumped 13 times to about $939 million. Total sales rose 12.3% to $18.27 billion.