Sony cuts back its losses and Samsung is rallying

Sony today said losses will be lower than expected this year while rival Samsung reported booming profits as the global economy bounces back.

Tokyo-based Sony said its losses will hit 95 billion yen (£636 million) this year compared with its earlier forecast of 120 billion yen.

Chief executive Howard Stringer is cutting costs by axing 16,000 jobs and shutting down eight factories in an attempt to turn around the company.

Sony posted losses of 32.6 billion yen in the third quarter, its fourth consecutive quarterly loss, as it was hit by sluggish mobile phone sales. It also reduced the prices of its PlayStation 3 game console. Samsung, which is based in South Korea and rivals Sony in markets such as digital cameras, said its third-quarter profits tripled to a record high of 3.72 trillion won.

The firm benefited from higher prices for computer memory chips, flatscreen televisions and liquid crystal displays. It ranks number two behind Nokia in mobile phones.

"Samsung has made great progress in strengthening its market leadership throughout 2009, and we believe the outlook is positive for further growth as the global economic recovery continues into 2010," said Robert Yi, Samsung's head of investor relations,