Shares of Sony Corp. jumped as its flat TV-led earnings turnaround boosted investor confidence, but it is unclear if the stock will keep rising as doubts remain over its new game console, PlayStation 3.

Its games division may post a bigger loss for the current quarter than in April-June, due to a possible increase in valuation losses on microchips used in PlayStation 3 as it builds up inventory in preparation for the November launch, Sony Senior Vice President Takao Yuhara told reporters.

"We might see valuation losses of a size that we cannot laugh away in the quarter," Mr Yuhara said.

The division reported an operating loss of 26.8 billion yen ($231.5 million) for the first quarter of the financial year.

Mr Yuhara also said the electronics and entertainment conglomerate aims to recoup hefty PS3-related investment in just less than five years as it did with the previous generation game console PlayStation 2.

It is not unusual for game makers to suffer substantial losses at the initial stage of a console launch by setting prices low to spur sales. They typically rake in profits later through game software sales.

Nonetheless, investors fret over the upcoming PS3 release as it exerts a far-reaching impact on Sony's group-wide performance.

At stake is not just pole position in the nearly $30 billion global video game industry, but dominance in next-generation DVDs and the commercial viability of Sony's Cell microchips, co-developed by Toshiba Corp. (6502.T: and International Business Machines Corp.