Panasonic returned to profit last quarter helped by aggressive cost cuts, despite a decline in sales.

The Japanese company posted a net profit of 61.4 billion yen ($667 million) in the October-December quarter versus a Y197.6 billion loss in the year-ago period.

The company said global demand weakened for flat panel TVs and digital products and devices, but sales grew in LED lighting and auto-related equipment.

Panasonic is undergoing a radical shift in strategy, turning away from its once mainstay consumer electronics business to focus on more industrial products that offer better profit margins. Panasonic plans to streamline its operations, focusing on fewer businesses and employing less staff.

Instead of competeing against S. Korean giants Samsung Electronics and LG Electronics Inc. in the TV industry, Panasonic sees more opportunity in constructing environmentally friendly buildings equipped with its energy-saving appliances and its renewable energy products such as solar panels.

The yen's slide since mid-November also helped Panasonic increase its earnings made abroad.

The company also kept its forecast for a net loss of 765 billion yen for the business year.