PREVIEW-Japan electronics makers may forecast smaller losses

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* Slow demand hampering recovery at Sony, Sharp, Panasonic

* Another strong year for Nintendo as games sell well

* Canon may raise outlook on yen's recent softer trend

By Kiyoshi Takenaka

TOKYO, April 24 (Reuters) - Sony Corp (6758.T) and other top Japanese electronics firms are likely to forecast smaller losses when they report annual results in the coming weeks, thanks to job cuts, plant closures and other cost-saving steps.

But game maker Nintendo Co Ltd (7974.OS) is expected to predict a record profit on the successful overseas debut this month of a new DS handheld player and a strong lineup of upcoming software titles including "Wii Sports Resort."

Sony, Panasonic Corp (6752.T), Sharp Corp (6753.T) are all set to report billions of dollars in net losses after the global financial crisis hit demand and precipitated price declines.

Demand for key consumer electronics products such as TVs and cellphones is expected to remain sluggish for at least another six months, analysts said.

"Electronics makers will probably give us scenarios where earnings will recover slowly but steadily after hitting a bottom in the second half of the past financial year or in the prior quarter," Daiwa Institute of Research analyst Kazuharu Miura said.

"The attainability of these scenarios will be questioned if their projections are based on overly optimistic outlooks for demand."

SLUGGISH SALES

Sony's TV operations are likely to remain in the red despite efforts to cut production costs, while profit margins at its cash cow digital camera business will shrink amid heightened competition in a crowded market, analysts said.

Sharp said this month it was enjoying brisk LCD panel demand, especially from China, and that it will start up a cost-efficient new panel plant in October.

But some analysts question whether such brisk demand will continue and said the new plant, while strengthening the cost competitiveness of Sharp's panels and LCD TVs, may depress overall display prices by flooding the market with new supply.

Panasonic's earnings are likely to stay under pressure from sluggish TV and digital camera sales, although the company may see some improvement in demand for its factory automation equipment and car electronics products.

Honda Motor Co (7267.T), Japan's second-largest automaker, has said it expects to see some recovery in U.S. auto sales by summer. A slump in the key U.S. market has led carmakers to slash production in recent months.

Unlike other consumer electronics makers, Nintendo will likely continue to defy the global downturn with stellar sales of its game machines, analysts said.

"I expect higher sales this year for both the DS and the Wii. The new DS was off to a strong start in the United States as well as Europe," said Okasan Securities analyst Masashi Morita.

"The Wii console has some more room to grow in Europe, where its penetration rates are not that high yet."

STRONG GAMES

Nintendo President Satoru Iwata said this month that the latest model of the DS, the DSi, sold 300,000 units each in North America and Europe in the first two days of sales.

He said the Wii has lost some steam in Japan, but that the company aims to rekindle demand by launching promising titles.

Canon (7751.T), which closes its books on Dec. 31, may raise its annual outlook when it announces first-quarter results next week as the yen has traded softer against the dollar and the euro in recent months than the company's assumptions for the year.

The Nikkei business daily said on Thursday the maker of digital cameras, copiers and printers is likely to lift its 2009 operating profit forecast by 13 percent to 180 billion yen.

That would still be down 64 percent on the year, and analysts warned that it would be a while before demand for cameras and office equipment stages a substantial recovery.

"I wouldn't say demand has bottomed out. This is going to be another tough year, and it is unclear when sales will go back up to prior levels," Mizuho Securities analyst Ryosuke Katsura said. (Reporting by Kiyoshi Takenaka; Editing by Edwina Gibbs)