After closing last year with a record loss, Koninklijke Philips Electronics NV reported a net profit for its first fiscal quarter, and said the economy looks to be on its way up.

The net profit of €9 million (US$7.83 million as of March 31, the last day of the period being reported) compares with a €93 million profit in the year-ago period, when markets were still strong, Philips said in a statement Tuesday.

Philips for the first time reported its results according to U.S. generally accepted accounting principles (U.S. GAAP), which led it to no longer amortize goodwill. If it were to follow Dutch accounting principles, the company would have reported a €91 million net loss, compared to a €106 million profit in the year-ago period, Philips Chief Financial Officer Jan Hommen said in a conference call with reporters.

Sales in the quarter came to €7.6 billion, down 7 percent compared to a year ago. Philips Consumer Electronics, Components and Semiconductors divisions are largely responsible for this sales decline, although Semiconductors and Components show better sequential sales in the first quarter, Philips said.

"It looks like we reached the bottom of the cycle," Hommen said. "We can be optimistic for the second quarter, but I want to be a little guarded for what comes after that. I think we will see a modest overall recovery in sales this year."

Even though Philips is cautious with the outlook beyond the first half of the year, Hommen said the company expects to report a profit at the end of the year.