Sony reported a second-quarter operating loss on Friday that was smaller than estimated, as sales of its PlayStation 4 games console reduced the impact of the company's low-performing smartphone division. Sony's operating loss reached 85.6 billion yen in July-September. In the same quarter last year, Sony booked a profit of 14.8 billion yen on the sale of assets.

Sony's sales were increased by 7.2% compared to the same quarter of the previous fiscal year, primarily due to a significant increase PS4 hardware and software sales and a strong performance of image sensors, as well as the favorable impact of foreign exchange rates.

This increase was partially offset by a significant decrease in sales in the company's other segments, primarily related to Sony?s exit from the PC business.

The company posted a net loss of 136 billion yen for the quarter and held its full-year net loss forecast at 230 billion yen.

Sony upped its operating profit forecast for its gaming division by 10 billion yen to 35 billion yen for the year after shifting 3.3 million PlayStation 4 consoles in the second quarter, moving it further ahead of rival Xbox One, made by Microsoft.

Sony also upped its operating profit outlook for its imaging and devices units but said its flagship electronics division had logged an overall operating loss of 137.3 billion yen in the first half.

Sony also lowered its smartphone sales outlook to 41 million handsets from 43 million, compared with 39 million last year.

Sony CFO Kenichiro Yoshida said the company would shrink its smartphone business in China, where it has been squeezed by nimble local rivals like Xiaomi, while the incoming chief of the mobile division, Hiroki Totoki, would focus on strengthening carrier relationships after assuming his new post on Nov. 16.

In Sony's movie business, its lower theatrical revenue for the quarter was partially offset by higher home entertainment and TV licensing income, such as the home entertainment release of "The Amazing Spider-Man 2."

In its music business, best-sellers were Barbra Streisand's "Partners" and Chris Brown's "X."