TOKYO (Reuters) - Sony Corp 6758.T booked its best-ever first-quarter profit on Tuesday, taking the firm one step toward its highest annual result in two decades, as smartphone makers demand more of its image sensors for high-end handsets sporting twin rear cameras.

FILE PHOTO: The Sony Playstation preview area prior to the company's news conference to kick-off their products at E3 2017 in Los Angeles, California, U.S. June 12, 2017. REUTERS/ Mike Blake/File Photo

But the record came without much fanfare, with Sony cutting its annual image sensor sales estimate slightly as Chinese smartphone clients shift to cheaper alternatives for lower-priced handsets. It also previously forecast a dip in sales of its mainstay yet maturing PlayStation 4 games console.

“When we marked strong earnings 10 years ago or 20 years ago, we always suffered sharp setbacks in the following year and onwards,” Chief Financial Officer Kenichiro Yoshida said at a news briefing. “We will keep going with a sense of pressure.”

The Japanese conglomerate, famed for producing the first portable cassette player at the end of the 1970s, has spent the recent past restructuring as price competition in its backbone consumer electronics business dragged down profit growth.

Chief Executive Officer Kazuo Hirai refocused Sony on games and sensors and, in a vote of confidence, saw its share price rise about 40 percent this year, touching a nine-year high.

The box-office success of its “Spider-Man: Homecoming” film has also fueled hopes of a rise in earnings for Sony’s pictures business, which is still working through a restructuring plan.

With its newly recovered strength, Sony is venturing into acquisitions. On Monday, it said it had bought most of the distributor of the English-language versions of animations “Dragon Ball Z” and “One Piece”.

QUAKE RECOVERY

On Tuesday, Sony said operating profit rose almost three-fold in April-June to 157.61 billion yen ($1.43 billion), exceeding the previous first-quarter record by about 30 percent, and beating analyst estimates by a similar degree.

The profit surge mainly reflected recovery in image sensors from earthquake damage sustained a year ago, the company said. Sony’s semiconductor division - which includes sensors - posted profit of 55.4 billion yen, a reverse of last year’s loss.

But Sony trimmed its full-year sales outlook for sensors, issued just three months ago, by 2.9 percent as Chinese phone makers steer away from building the high-end handsets that Sony typically targets.

In gaming, the usual pillar of growth crumbled with a 59.8 percent profit drop in a quarter of few in-house blockbuster software titles and price cuts for the 4-year-old PlayStation 4, the sales of which it expects to fall 10 percent this year.

Sony said it expects to gaming profit to recover in subsequent quarters as it releases new titles.

For the full year ending March, Sony maintained the group’s operating profit forecast of 500 billion yen.

That is about 12 percent below analysts’ average estimate. But it would still be the highest since 526 billion yen in the year ended March 1998, when strong sales of consumer electronics including its first PlayStation coincided with box-office hit “Men in Black”.