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1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549Form 20-FREGISTRATION STATEMENT PURSUANT TO SECTION 12(b)OR 12(g)OF THE SECURITIES EXCHANGE ACT OF 1934orANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended March 31,2023orTRAN
2、SITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from/toorSHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934Date of event requiring this shell company report:Commission file number 1-6439Sony Group Ka
3、bushiki Kaisha(Exact Name of Registrant as specified in its charter)SONY GROUP CORPORATION(Translation of Registrants name into English)Japan(Jurisdiction of incorporation or organization)7-1,KONAN 1-CHOME,MINATO-KU,TOKYO 108-0075 JAPAN(Address of principal executive offices)J.Justin Hill,Senior Vic
4、e President,Finance&Investor RelationsSony Corporation of America25 Madison Avenue,26thFloorNew York,New York 10010-8601Telephone:212-833-6722E-mail:(Name,Telephone,E-mail and Address of Company Contact Person)Securities registered or to be registered pursuant to Section 12(b)of the Act:Title of Eac
5、h ClassTrading Symbol(s)Name of Each Exchange on Which RegisteredAmerican Depositary Shares*SONYNew York Stock ExchangeCommon Stock*American Depositary Shares evidenced by American Depositary Receipts.Each American Depositary Share represents one share of CommonStock.*No par value per share.Not for
6、trading,but only in connection with the listing of American Depositary Shares pursuant to the requirements ofthe New York Stock Exchange.Securities registered or to be registered pursuant to Section 12(g)of the Act:NoneSecurities for which there is a reporting obligation pursuant to Section 15(d)of
7、the Act:NoneIndicate the number of outstanding shares of each of the issuers classes of capital or common stock as of the close of the period covered by theAnnual Report:Outstanding as ofMarch 31,2023March 31,2023Title of Class(Tokyo Time)(New York Time)Common Stock1,234,497,560American Depositary S
8、hares117,871,924Indicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No If this report is an annual or transition report,indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or15(d)of the
9、Securities Exchange Act of 1934.Yes No Indicate by check mark whether the registrant:(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Actof 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such repor
10、ts),and(2)has been subject tosuch filing requirements for the past 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule405 of Regulation S-T during the preceding 12 months(or for such shorter p
11、eriod that the registrant was required to submit suchfiles).Yes No Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,or a non-accelerated filer,or an emerging growthcompany.See definition of“large accelerated filer,”“accelerated filer”and“emerging growth
12、 company”in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer Emerging growth companyIf an emerging growth company that prepares its financial statements in accordance with U.S.GAAP,indicate by check mark if the registranthas elected not to use the extend
13、ed transition period for complying with any new or revised financial accounting standards provided pursuant toSection 13(a)of the Exchange Act.The term“new or revised financial accounting standard”refers to any update issued by the Financial Accounting Standards Board to itsAccounting Standards Codi
14、fication after April 5,2012.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of itsinternal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public ac
15、counting firmthat prepared or issued its audit report.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrantincluded in the filing reflect the correction of an error to previously issued financial statements.Indicate
16、 by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-basedcompensation received by any of the registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark which basis of accounting
17、the registrant has used to prepare the financial statements included in this filing:US GAAP International Financial Reporting Standards as issued by the International Accounting Standards Board Other If“Other”has been checked in response to the previous question,indicate by check mark which financia
18、l statement item the registrant haselected to follow.Item 17 Item 18 If this is an annual report,indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No Cautionary StatementStatements made in this document with respect to Sonys current pl
19、ans,estimates,strategies and beliefs andother statements that are not historical facts are forward-looking statements about the future performance ofSony.Forward-looking statements include,but are not limited to,those statements using words such as“believe,”“expect,”“plans,”“strategy,”“prospects,”“f
20、orecast,”“estimate,”“project,”“anticipate,”“aim,”“intend,”“seek,”“may,”“might,”“could”or“should,”and words of similar meaning in connection with adiscussion of future operations,financial performance,events or conditions.From time to time,oral or writtenforward-looking statements may also be include
21、d in other materials released to the public.These statements arebased on managements assumptions,judgments and beliefs in light of the information currently available to it.Sony cautions investors that a number of important risks and uncertainties could cause actual results to differmaterially from
22、those discussed in the forward-looking statements,and therefore investors should not placeundue reliance on them.Investors also should not rely on any obligation of Sony to update or revise any forward-looking statements,whether as a result of new information,future events or otherwise.Sony disclaim
23、s any suchobligation.Risks and uncertainties that might affect Sony include,but are not limited to:(i)Sonys ability to maintain product quality and customer satisfaction with its products and services;(ii)Sonys ability to continue to design and develop and win acceptance of,as well as achieve suffic
24、ientcost reductions for,its products and services,including image sensors,game and network platforms,smartphones and televisions,which are offered in highly competitive markets characterized by severeprice competition and continual new product and service introductions,rapid development intechnology
25、 and subjective and changing customer preferences;(iii)Sonys ability to implement successful hardware,software,and content integration strategies,and todevelop and implement successful sales and distribution strategies in light of new technologies anddistribution platforms;(iv)the effectiveness of S
26、onys strategies and their execution,including but not limited to the success ofSonys acquisitions,joint ventures,investments,capital expenditures,restructurings and other strategicinitiatives;(v)changes in laws,regulations and government policies in the markets in which Sony and its third-partysuppl
27、iers,service providers and business partners operate,including those related to taxation,as wellas growing consumer focus on corporate social responsibility;(vi)Sonys continued ability to identify the products,services and market trends with significant growthpotential,to devote sufficient resources
28、 to research and development,to prioritize investments andcapital expenditures correctly and to recoup its investments and capital expenditures,including thoserequired for technology development and product capacity;(vii)Sonys reliance on external business partners,including for the procurement of p
29、arts,components,software and network services for its products or services,the manufacturing,marketing anddistribution of its products,and its other business operations;(viii)the global economic and political environment in which Sony operates and the economic and politicalconditions in Sonys market
30、s,particularly levels of consumer spending;(ix)Sonys ability to meet operational and liquidity needs as a result of significant volatility and disruptionin the global financial markets or a ratings downgrade;(x)Sonys ability to forecast demands,manage timely procurement and control inventories;(xi)f
31、oreign exchange rates,particularly between the yen and the U.S.dollar,the euro and other currenciesin which Sony makes significant sales and incurs production costs,or in which Sonys assets,liabilities and operating results are denominated;(xii)Sonys ability to recruit,retain and maintain productive
32、 relations with highly skilled personnel;(xiii)Sonys ability to prevent unauthorized use or theft of intellectual property rights,to obtain or renewlicenses relating to intellectual property rights and to defend itself against claims that its products orservices infringe the intellectual property ri
33、ghts owned by others;(xiv)the impact of changes in interest rates and unfavorable conditions or developments(including marketfluctuations or volatility)in the Japanese equity markets on the revenue and operating income of theFinancial Services segment;-2-(xv)shifts in customer demand for financial s
34、ervices such as life insurance and Sonys ability to conductsuccessful asset liability management in the Financial Services segment;(xvi)risks related to catastrophic disasters,geopolitical conflicts,pandemic disease or similar events;(xvii)the ability of Sony,its third-party service providers or bus
35、iness partners to anticipate and managecybersecurity risk,including the risk of unauthorized access to Sonys business information and thepersonally identifiable information of its employees and customers,potential business disruptions orfinancial losses;and(xviii)the outcome of pending and/or future
36、 legal and/or regulatory proceedings.Risks and uncertainties also include the impact of any future events with material adverse impact.Thecontinued impact of developments relating to the situation in Ukraine and Russia could heighten many of therisks and uncertainties noted above.Important informati
37、on regarding risks and uncertainties is also set forth elsewhere in this annual report,including in“Risk Factors”under“Item 3.Key Information,”“Item 4.Information on the Company,”“Item 5.Operating and Financial Review and Prospects,”“Legal Proceedings”included in“Item 8.FinancialInformation,”Sonys c
38、onsolidated financial statements referenced in“Item 8.Financial Information”and“Item 11.Quantitative and Qualitative Disclosures about Market Risk.”In this document,Sony Group Corporation and its consolidated subsidiaries are together referred to as“Sony”or“Sony Group.”In addition,“Sales and financi
39、al services revenue”are referred to as“sales”in thenarrative description except in the consolidated financial statements.-3-TABLE OF CONTENTSItem 1.Identity of Directors,Senior Management and Advisers.6Item 2.Offer Statistics and Expected Timetable.6Item 3.Key Information.6A.Reserved.6B.Capitalizati
40、on and Indebtedness.6C.Reasons for the Offer and Use of Proceeds.6D.Risk Factors.6Item 4.Information on the Company.17A.History and Development of the Company.17B.Business Overview.20C.Organizational Structure.35D.Property,Plant and Equipment.35Item 4A.Unresolved Staff Comments.37Item 5.Operating an
41、d Financial Review and Prospects.37A.Operating Results.37B.Liquidity and Capital Resources.50C.Research and Development.52D.Trend Information.53E.Critical Accounting Estimates.58Item 6.Directors,Senior Management and Employees.61A.Directors and Senior Management.61B.Compensation.66C.Board Practices.
42、73D.Employees.84E.Share Ownership.86Item 7.Major Shareholders and Related Party Transactions.86A.Major Shareholders.86B.Related Party Transactions.87C.Interests of Experts and Counsel.87Item 8.Financial Information.87A.Consolidated Statements and Other Financial Information.87Legal Proceedings.87Div
43、idend Policy.87B.Significant Changes.88Item 9.The Offer and Listing.88A.Offer and Listing Details.88B.Plan of Distribution.88C.Markets.88D.Selling Shareholders.88E.Dilution.88F.Expenses of the Issue.88Item 10.Additional Information.88A.Share Capital.88B.Memorandum and Articles of Association.88C.Mat
44、erial Contracts.97D.Exchange Controls.97E.Taxation.101F.Dividends and Paying Agents.104G.Statement by Experts.104H.Documents on Display.104I.Subsidiary Information.104J.Annual Report to Security Holders.104Item 11.Quantitative and Qualitative Disclosures about Market Risk.104Item 12.Description of S
45、ecurities Other Than Equity Securities.104A.Debt Securities.104B.Warrants and Rights.104C.Other Securities.104D.American Depositary Shares.104-4-Item 13.Defaults,Dividend Arrearages and Delinquencies.106Item 14.Material Modifications to the Rights of Security Holders and Use of Proceeds.106Item 15.C
46、ontrols and Procedures.106Item 16.Reserved.107Item 16A.Audit Committee Financial Expert.107Item 16B.Code of Ethics.107Item 16C.Principal Accountant Fees and Services.108Audit and Non-Audit Fees.108Audit Committees Pre-Approval Policies and Procedures.108Item 16D.Exemptions from the Listing Standards
47、 for Audit Committees.108Item 16E.Purchases of Equity Securities by the Issuer and Affiliated Purchasers.109Item 16F.Change in Registrants Certifying Accountant.110Item 16G.Corporate Governance.111Item 16H.Mine Safety Disclosure.116Item 16I.Disclosure Regarding Foreign Jurisdictions that Prevent Ins
48、pections.116Item 17.Financial Statements.116Item 18.Financial Statements.116Item 19.Exhibits.117Signatures.118-5-Item 1.Identity of Directors,Senior Management and AdvisersNot ApplicableItem 2.Offer Statistics and Expected TimetableNot ApplicableItem 3.Key InformationA.ReservedB.Capitalization and I
49、ndebtednessNot ApplicableC.Reasons for the Offer and Use of ProceedsNot ApplicableD.Risk FactorsThis section contains forward-looking statements that are subject to the Cautionary Statement appearing onpage 2 of this annual report.Risks to Sony are also discussed elsewhere in this annual report.Sony
50、 must overcome increasingly intense competition,which could lead to lower revenue or operatingmargins.Sony has several business segments in different industries with many product and service categories,whichcause it to compete with many existing and new competitors ranging from large multinational c
51、ompanies tohighly specialized entities that focus on only one or a few businesses and also,potentially,with outsourcedmanufacturing service partners that currently supply products to Sony.These competitors may have greaterfinancial,technical,labor and marketing resources available to them than those
52、 available to Sony.Sonysfinancial condition and operating results depend on its ability to efficiently anticipate and respond to theseestablished and new competitors.The competitive factors Sony faces vary depending on the nature of the business.For example,in theelectronics area,Sony competes on th
53、e basis of various factors including price and function,while in the Musicand Pictures segments,Sony competes for talent,such as artists,songwriters,actors,directors and producers,andfor entertainment content that is created,acquired,licensed and/or distributed.Competition on price can lead tolower
54、margins when costs do not fall at a proportional rate,and competition for talent and appealing product canalso lead to lower profitability if the higher costs required for such talent and content cannot be recouped throughgreater sales.Moreover,even for those products where Sony believes it has a st
55、rong competitive advantage,suchas image sensors,it is possible that its competitors technological capabilities will accelerate such that Sonywould be unable to maintain its advantageous market position.In terms of consumer electronics products,toproduce products that appeal to changing and increasin
56、gly diverse consumer preferences,including constantlychanging consumer interest in minimizing energy consumption and using environmentally friendly materials forboth products and packaging,or to overcome the fact that a relatively high percentage of consumers alreadypossess similar products,Sony mus
57、t develop superior technology,anticipate consumer tastes,and rapidlydevelop attractive and differentiated products with competitive prices and features.Sony faces increasinglyintense pricing pressure from competitors,retailer consolidation,new sales/distribution channels,and shorterproduct cycles in
58、 a variety of consumer product categories.In the Music and Pictures segments,operating resultscan be impacted by worldwide consumer acceptance of their products,which is difficult to predict,and byalternative forms of entertainment and leisure activities available to consumers,as well as by competin
59、g productsreleased at or near the same time.For example,in the Pictures segment,as box office revenues recover asrestrictions due to the spread of COVID-19 have been lifted around the world and movie theaters continue toreopen,the theatrical release calendar of films by major studios is becoming mor
60、e crowded,increasingcompetition for available screen space.This situation could adversely affect the operating results of the Picturessegment.If Sony is unable to maintain its advantageous market position in the fields in which it has a technological orother competitive advantage,Sony is unable to e
61、ffectively anticipate and counter the ongoing price erosion that-6-frequently affects its consumer products or the cost pressures affecting its businesses,there is a change inexisting business models or consumer preferences,or the average prices of Sonys products decrease faster thanSony is able to
62、reduce manufacturing costs,Sonys operating results and financial condition may be adverselyimpacted.To remain competitive and stimulate customer demand,Sony must invest in research and development toachieve product and service innovations and successfully manage frequent introductions of such new pr
63、oductsand services.To strengthen the competitiveness of its products and services,Sony continues to invest in research anddevelopment(“R&D”),particularly in growth areas such as the Game&Network Services(“G&NS”)andImaging&Sensing Solutions(“I&SS”)segments.However,Sony may not be successful in invest
64、ing in R&D ifit fails to identify products,services and market trends with significant growth potential.In addition,Sonysinvestments may not yield the innovation or the expected results quickly enough,or competitors may lead Sonyin technological innovation.This may hinder Sonys ability to commercial
65、ize new and competitive products andservices.Sony must continually introduce,enhance and stimulate customer demand for consumer electronic productsand network services.Sales of these products and services are particularly sensitive to the significant weightingof consumer demand to the year-end holid
66、ay season.In the G&NS segment,the successful introduction andpenetration of gaming platforms,including streaming,is a significant factor driving sales and profitability,andthis success is affected by the ability to provide customers with attractive software line-ups and online services.However,there
67、 is no assurance that third-party software developers and publishers,major contributors to thiseffort,will continue to develop and release software.In addition,Sony believes that integrating its hardware,software,entertainment content and network services and minimizing their energy consumption,as w
68、ell asinvesting in R&D to effect such integration,is essential in generating revenue growth and profitability.However,this strategy depends on its ability to further develop network services technologies,coordinate and prioritizestrategic and operational issues among Sonys various business units and
69、 sales channels,continually introduceenhanced,energy efficient and competitively priced hardware that is seamlessly connected to energy efficientnetwork platforms with user interfaces that are innovative and attractive to consumers and also standardizetechnological and interface specifications indus
70、try-wide and across Sonys networked products and businessunits.In addition,the G&NS,Music and Pictures segments must invest substantial amounts,which may includesignificant upfront investments,in internally developed software titles,artist advances,music catalogs,motionpicture productions,television
71、 productions and broadcast programming before knowing whether their productswill receive customer acceptance.Furthermore,underperformance of Picturesproducts in the initial distributionmarket is correlated with weak performance in subsequent distribution markets,which would have an adverseeffect on
72、Sonys results in the year of initial release as well as future years.The successful introductions of,and transitions to,new products and services depend on a number offactors,such as the timely and successful completion of development efforts,market acceptance,planning andexecuting an effective mark
73、eting strategy,managing new product introductions,managing production ramp-upissues,the availability of application software for new products,quality control and the concentration ofconsumer demand in the year-end holiday season.If Sony cannot achieve the expected results from itsinvestment in R&D,a
74、dequately manage frequent introductions of new products and services and obtainconsumer acceptance of its new products and services,or if Sony is not successful in implementing its integrationstrategy,Sonys reputation,operating results and financial condition may be adversely impacted.Sonys strategi
75、c initiatives,including acquisitions,joint ventures,investments,capital expenditures andrestructurings,may not be successful in achieving their strategic objectives.Sony actively engages in acquisitions,joint ventures,capital expenditures and other strategic investments toacquire new technologies,ef
76、ficiently develop new businesses and enhance its business competitiveness.Forexample,in the fiscal year ended March 31,2022,Sony made an additional strategic investment in Epic Games,Inc.(“Epic Games”),in which Sony already held a minority interest;acquired 100%of the shares and relatedassets of cer
77、tain subsidiaries of Kobalt Music Group Limited(“Kobalt”)including AWAL,Kobalts musicdistribution business mainly for independent recording artists,and Kobalt Neighbouring Rights,Kobalts musicneighboring rights management business;acquired 100%of the equity interest in Ellation Holdings,Inc.(“Ellati
78、on”),a subsidiary of AT&T Inc.which operated the anime business Crunchyroll;made a minorityinvestment in Japan Advanced Semiconductor Manufacturing Inc.,a subsidiary of Taiwan SemiconductorManufacturing Company Limited(TSMC);and acquired 100%of the shares and related assets of Som Livre,anindependen
79、t music label in Brazil.In the fiscal year ended March 31,2023,Sony acquired 100%of the shares of-7-Bungie,Inc.(“Bungie”)an independent videogame developer in the United States;made an additional strategicinvestment in Epic Games;and established a joint venture with Honda Motor Co.,Ltd.in the mobili
80、ty field.In some cases,the completion of mergers and acquisitions is subject to certain closing conditions,includingregulatory approvals.As a result of anti-trust laws and regulations and anti-trust regulatory authorities becomingstricter,regulatory reviews following the signing of a definitive agre
81、ement may take longer than expected,orSony may fail to obtain regulatory approvals,resulting in the loss of business opportunities and Sonys inabilityto realize some or all of the initially expected results of mergers and acquisitions.As of the date of this report,mergers and acquisitions that Sony
82、has already signed definitive agreements for and whose completion is subjectto regulatory approvals include the merger of Sony Pictures Networks India(“SPNI”)with Zee EntertainmentEnterprises Ltd.(“Zee”),a publicly listed Indian media and content company.While Sony performs a comprehensive analysis
83、and evaluation of merged or acquired organizations prior totheir acquisition from various perspectives such as technology,accounting,tax,finance,human resources(“HR”)and legal,Sonys financial results may be adversely affected by factors including the significant cost of theacquisition and/or integra
84、tion expenses,IT and information security risks introduced from newly acquiredorganizations,failure to achieve initially expected synergies,failure to generate expected revenue and costimprovements,loss of key personnel and assumption of liabilities.When establishing joint ventures and strategic par
85、tnerships,Sonys financial and operating results may beadversely affected by strategic or cultural differences with partners,conflicts of interest,failure to achievesynergies,additional funding or debt guarantees required to maintain the joint venture or partnership,requirements to buy out a joint ve
86、nture partner,sell its shares or dissolve a partnership,insufficient managementcontrol including control over cash flow,loss of proprietary technology and know-how,impairment losses andreputational harm from the actions or activities of a joint venture that uses the Sony brand.Sony invests heavily i
87、n production facilities and equipment,including fabrication facilities used to makeimage sensors for smartphones and other products.Sony may not be able to execute these capital expenditures asplanned or recover these capital expenditures in part or full or in the planned timeframe due to the compet
88、itiveenvironment,lower-than-expected consumer demand,changes in the financial condition or business decisions ofSonys major customers,or delays in the procurement of production facilities and equipment.Sony invested237.1 billion yen and 355.9 billion yen of capital in the fiscal years ended March 31
89、,2022 and 2023,respectively,mainly for the purpose of increasing image sensor production capacity.Further,Sony is implementing initiatives for restructuring and transformation to enhance profitability,business autonomy and shareholder value or to clearly position each business within the overall bus
90、inessportfolio.However,the expected benefits of these initiatives,including the expected level of profitability,maynot be realized due to internal and external impediments or market conditions worsening beyond expectations.IfSony is not successful in achieving its restructuring and transformation in
91、itiatives,Sonys operating results,financial condition,reputation,competitiveness or profitability may be adversely affected.Sonys sales and profitability may be affected by the operating performance of wholesalers,retailers,otherresellers and third-party distributors.Sony is dependent for the distri
92、bution of its products on wholesalers,retailers,other resellers and third-partydistributors,many of whom also distribute competitors products.For example,in some cases,Sonyssmartphones sold through cellular network carriers are subsidized by the carriers.There is no assurance that suchsubsidies will
93、 be continued at all or in the same amounts upon renewal of Sonys agreements with these carriersor in agreements Sony enters into with new carriers.In addition,the Pictures segment depends on third parties totheatrically exhibit its motion pictures,and to operate cable,satellite,internet and other d
94、istribution systems todistribute its motion pictures and television programming.A decline in the licensing fees received from thesethird parties may adversely affect the Pictures segments sales.The Pictures segments worldwide televisionnetworks are also distributed on third-party cable,satellite and
95、 other distribution systems and the failure torenew,or the renewal on less favorable terms of,television carriage contracts(broadcasting agreements)withthese third-party distributors may adversely affect the Pictures segments ability to generate advertising andsubscription sales through these networ
96、ks.Sony invests in programs to incentivize wholesalers,retailers,and other resellers and third-party distributorsto position and promote Sonys products,but there is no assurance that these programs will provide a significantreturn or incremental revenue by persuading consumers to buy Sony products i
97、nstead of competitorsproducts.The operating results and financial condition of many wholesalers,retailers,other resellers and third-partydistributors have been adversely impacted by competition,especially from online retailers,and weak economic-8-conditions.If their financial condition continues to
98、weaken,they stop distributing Sonys products,or uncertaintyregarding demand for Sonys products or other factors cause them to reduce their ordering,marketing,subsidizing,or distributing Sonys products,Sonys operating results and financial condition may be adverselyimpacted.As a global company,Sony i
99、s subject to a wide range of laws and regulations and a growing consumer focuson corporate social responsibility in many countries.Those laws and regulations,as well as consumer andregulator focus,might change in significant ways,leading to an increase in the costs of Sonys operations,acurtailment o
100、f Sonys activities,and/or an adverse effect on Sonys reputation.As a global company,Sony is subject to the laws and regulations of many countries throughout the worldthat affect its business operations in a number of areas,including advertising,promotions,consumer protection,import and export requir
101、ements,anti-corruption,anti-trust,environmental protection(including decarbonizingregulations in connection with actions against climate change),data privacy and data protection,content andbroadcast regulation,intellectual property,labor,product liability,taxation(including taxes from certain revenu
102、eon digital services),foreign investment,government procurement,foreign exchange controls,and economicsanctions.Compliance with these laws and regulations may be onerous and expensive.These laws and regulationscontinue to develop and may be inconsistent from jurisdiction to jurisdiction,further incr
103、easing the cost ofcompliance and doing business.Any such developments could occur frequently and without warning and couldmake Sonys products or services less attractive to its customers,delay or prohibit introduction of new productsor services in one or more regions or cause Sony to change or limit
104、 its business practices.For example,imposition of restrictive trade measures in the United States and elsewhere,as well as retaliatory actions againstsuch measures,could result in increased customs duties applicable to Sonys products or increased costs forprocuring parts and components,and could lim
105、it or prohibit the sales of Sonys products and services to certainof its current or potential customers,which may adversely affect Sonys operating results and financial condition.In the I&SS segment,Sony suspended product shipments of image sensors to a certain Chinese customer fromSeptember 15,2020
106、,pursuant to export restrictions announced by the U.S.government on August 17,2020.As aresult,image sensor sales decreased compared to before the export restrictions came into effect,although Sonyresumed a portion of shipments to the customer after receiving a U.S.export license.Sony also recordedin
107、ventory write-downs of certain image sensors for the same customer in the fiscal year ended March 31,2021.In addition,changes in laws or regulations or the judicial interpretation thereof that Sony relies on or Sony issubject to in conducting its operations,including online operations,as well as Son
108、ys failure to anticipate suchchanges,may subject Sony to greater risk of liability,increase the costs of compliance,or limit Sonys ability toengage in or expand certain operations or lead to discontinuance of certain operations.Violation of applicable laws or regulations by Sony,its officers or empl
109、oyees,third-party suppliers,business partners or agents may subject Sony to monetary fines,penalties,legal judgments,restrictions onbusiness operations and/or reputational damage.Additionally,there is a growing global regulatory and consumerfocus on sustainability efforts,including corporate social
110、responsibility and sourcing practices,as well asincreasing regulatory obligations of public disclosure regarding these matters.In particular,there is increasedattention on labor practices,including work environments at electronic component manufacturers,originalequipment manufacturers/original desig
111、n manufacturers(OEM/ODM),and product manufacturers operating inAsia.Increased regulation or public pressure in this area could cause Sonys compliance costs to increase,particularly since Sony uses many parts,components and materials to manufacture its products and relies onsuppliers to provide these
112、 parts,components and materials but does not directly control the suppliersprocurement or employment practices.A finding of non-compliance,or the perception that Sony has notresponded appropriately to growing consumer concern for such issues,whether or not Sony is legally required todo so,may advers
113、ely affect Sonys reputation,operating results and financial condition.Sony must manage its large volume of and widespread procurement from third-party suppliers and businesspartners to control inventory levels,availability,costs and quality of parts,components,materials,softwareand network services
114、within volatile markets.Sonys products and services rely on a large volume of third-party suppliers and business partners for parts,components,materials,software and network services,including semiconductors,chipsets for PlayStationgameconsoles and mobile products,LCD(liquid crystal display)panels a
115、nd the Android OS that is used in mobileproducts,televisions and services.As a result,external suppliersand partnerssupply shortages,fluctuations inpricing,quality issues,discontinued support,changes in business terms or prioritization of customers outside theelectronics area or of Sonys competitors
116、 can adversely affect Sonys operating results,brand and reputation.For-9-example,the Entertainment Technology&Services(“ET&S”)*segment was affected by the global shortage ofsemiconductors and other components,which became pronounced from the latter half of the fiscal year endedMarch 31,2021 through
117、the first half of the fiscal year ended March 31,2023 and caused Sony to continue to beunable to fully meet market demand.Although global demand for semiconductors and other components was ona declining trend as of the end of the fiscal year ended March 31,2023,Sonys operating results and financialc
118、ondition could be affected if demand becomes strong again.Reliance on third-party software and technologiesmay make it increasingly difficult for Sony to differentiate its products from competitors products.Also,shortages or delayed shipments of critical parts or components may result in a reduction
119、 or suspension ofproduction at Sonys or its business partnersmanufacturing sites,particularly where Sony is substantially relianton one supplier,where there is limited production capacity for custom parts or components,or where there areinitial manufacturing capacity constraints for products,parts o
120、r components that use new technologies.Sony places orders for parts and components in line with production and inventory plans determined inadvance based on its forecast of consumer demand,which is highly volatile and difficult to predict.Inaccurateforecasts of consumer demand or inadequate business
121、 planning can lead to a shortage or excess inventory,whichcan disrupt production plans and result in lost sales opportunities or inventory adjustments,respectively.Sonywrites down the value of its inventory when the underlying parts,components or products have become obsolete,when inventory levels e
122、xceed the amount expected to be used,or when the value of the inventory is otherwiserecorded at a value higher than net realizable value.Such lost sales opportunities,inventory adjustments,orshortages of parts and components have had and may have an adverse impact on Sonys operating results andfinan
123、cial condition.*The former Electronics Products&Solutions(EP&S)segment was renamed the Entertainment,Technology&Services(ET&S)segment effective from April 2022.Sonys sales,profitability and operations are sensitive to global and regional economic and political trendsand conditions.Sonys sales and pr
124、ofitability are sensitive to economic trends in its major markets,such as inflation.In thefiscal year ended March 31,2023,23.3%,29.5%and 19.0%of Sonys sales and financial services revenue wereattributable to Japan,the U.S.and Europe,respectively.These markets may be subject to significant economicdo
125、wnturns,resulting in an adverse impact on Sonys operating results and financial condition.An actual orexpected deterioration of economic conditions in any of Sonys major markets may result in a decline inconsumersconsumption and adverse impacts on the businesses of commercial customers,resulting in
126、reduceddemand for Sonys products and services.In addition,Sonys operations are conducted in many countries and regions around the world,and theseinternational operations,particularly in certain emerging markets,can create challenges.For example,in theET&S,I&SS and G&NS segments,production and procur
127、ement of products,parts and components in China andother Asian countries and regions increase the time necessary to supply products to other markets worldwide,which can make it more difficult to meet changing customer demand in a timely manner.Further,in certaincountries and regions,Sony may encount
128、er difficulty in planning and managing operations due to unfavorablepolitical or economic factors,such as armed conflicts,deterioration in foreign relations,changes in trade policies,non-compliance with expected business conduct and a lack of adequate infrastructure.If international ordomestic polit
129、ical and military instability disrupts Sonys business operations or those of its business partnersSonys operating results and financial condition may be adversely affected.For example,as a response to theworsening of the situation in Ukraine and Russia that began in the fiscal year ended March 31,20
130、22,as of thedate of this report,Sony has suspended its business in Russia.If this situation worsens further in the future,itcould create global uncertainty,possibly leading to the worsening of Sonys businesses in other regions or adeterioration in global economic conditions resulting in an adverse i
131、mpact on Sonys operating results andfinancial condition.Foreign exchange rate fluctuations can affect Sonys operating results and financial condition.Sonys operating results and financial condition are sensitive to foreign exchange rate fluctuations becausemany of Sonys products are sold in countrie
132、s other than the ones in which they were developed and/ormanufactured.For example,within Sonys electronics area,R&D and headquartersoverhead costs are incurredmainly in yen,and manufacturing costs,including material costs,costs of procurement of parts and components,and costs of outsourced manufactu
133、ring services,are incurred mainly in U.S.dollars and yen.Sales are recordedin yen,U.S.dollars,euros,Chinese renminbi,and local currencies of other areas,including emerging markets.Consequently,foreign exchange rate fluctuations have had and may have an adverse impact on Sonys operatingresults,especi
134、ally when the yen or the euro weaken significantly against the U.S.dollar,when the yen-10-strengthens significantly against the euro,or when the U.S.dollar strengthens against emerging marketcurrencies.Sonys operating results may also be adversely impacted by foreign exchange rate fluctuations since
135、Sonys consolidated statements of income are prepared by translating the local currency denominated operatingresults of its subsidiaries around the world into yen.Furthermore,as Sonys businesses have expanded in Chinaand other areas,including emerging markets,the impact of fluctuations of foreign cur
136、rency exchange rates inthese areas against the U.S.dollar and yen has increased.Mid-to long-term changes in exchange rate levels mayinterfere with Sonys global allocation of resources and hinder Sonys ability to engage in R&D,procurement,production,logistics,and sales activities while maintaining pr
137、ofitability.Although Sony seeks to reduce its exposure to foreign exchange risk by hedging a portion of its net short-term foreign currency exposure shortly before the transactions occur,such hedging activity may not offset,ormay offset only a portion of,the adverse financial effects of unfavorable
138、movements in foreign exchange ratesover the limited time the hedges are in place.Moreover,since Sonys consolidated statements of financial position are prepared by translating the localcurrency denominated assets and liabilities of its subsidiaries around the world into yen,Sonys equity capitalmay b
139、e adversely impacted when the yen strengthens significantly against the U.S.dollar,the euro and/or otherforeign currencies.Ratings downgrades or significant volatility and disruption in the global financial markets may adverselyaffect the availability and cost of Sonys funding.Sonys credit ratings m
140、ay be adversely impacted by unfavorable operating results and a decline in itsfinancial condition.Any credit rating downgrades may,in turn,result in an increase in Sonys cost of fundingand may have an adverse impact on Sonys ability to access commercial paper(“CP”)or mid-to long-term debtmarkets on
141、acceptable terms.Additionally,global financial markets may experience significant levels of volatility and disruption,generallyputting downward pressure on financial and other asset prices and impacting credit availability.Historically,Sonysprimary sources of funds have been cash flows from operatio
142、ns,the issuance of CP and other debt securities,suchas term debt,as well as borrowings from banks and other institutional lenders.There can be no assurance that suchsources will continue to be available on acceptable terms or be sufficient to meet Sonys needs.As a result,Sony may seek other sources
143、of financing to fund operations,such as the draw-down of fundsfrom contractually committed lines of credit from financial institutions or the sale of assets,in order to repay CPand mid-to long-term debt as they become due,and to meet other operational and liquidity needs.However,suchfunding sources
144、may also not be available at acceptable terms or be sufficient to meet Sonys requirements.As aresult,Sonys operating results,financial condition and liquidity may be adversely affected.Sonys success depends on the ability to recruit,retain and maintain productive relations with diverse peoplewho emb
145、race a challenging spirit and possess the ambition to grow.In order to continue to create content,develop services,design,manufacture,market,and sell products,inincreasingly competitive markets,Sony must attract,retain and maintain productive relations with key personnel,both internally and external
146、ly,who possess high levels of expertise and broad experience,including its executiveteam,other management professionals,creative talent,and hardware and software engineers.However,such keypersonnel are in high demand.In addition,business divestitures,restructuring or other transformation initiatives
147、may lead to an unintended loss of experienced employees or know-how.Actual or threatened work slowdowns orstoppages related to unionized workers,particularly in the entertainment field,could lead to delayed releases orcost increases.For example,in the Pictures segment,the Writers Guild of America(“W
148、GA”)went on strikeeffective May 2,2023.If this strike is prolonged,it may adversely affect the operating results of the Picturessegment.Furthermore,in Japan,with a declining workforce due to the falling birthrate and aging population,intensifying competition among companies for specialized talent,an
149、d rising labor costs,it may become difficultto secure the necessary talent if Sonys HR system is inadequate in its design and operations.If these incidentsoccur or if Sony is unable to attract,retain and maintain productive relations with employees with high levels ofexpertise and broad experience a
150、s well as key management professionals,Sonys operating results and financialcondition may be adversely affected.Sonys intellectual property might be subject to unauthorized use or theft and it might encounter restrictionsin its use of intellectual property owned by third parties.Sonys intellectual p
151、roperty might be subject to unauthorized use or theft.For example,digital technology,the availability of digital media,and global internet penetration impact Sonys ability to protect its copyrighted-11-content from unauthorized duplication,digital theft and counterfeiting,putting pressure on legitim
152、ate productsales.Sony has incurred and will continue to incur expenses to help protect its intellectual property rights;however,Sonys various initiatives to prevent such unauthorized use or theft of intellectual property might notachieve their intended result,which could adversely affect Sonys compe
153、titive position and the value of itsinvestment in R&D.Additionally,Sonys intellectual property rights may be challenged or invalidated,or suchintellectual property rights may not be sufficient to provide Sony with competitive advantages.Many of Sonys products and services are designed under the lice
154、nse of patents and other intellectualproperty rights owned by third parties.Based upon past experience and industry practice,Sony believes it will beable to obtain or renew licenses relating to various intellectual property rights that its business needs in thefuture;however,such licenses may not be
155、 available at all or on acceptable terms,and as a consequence Sony mayneed to redesign or discontinue its marketing,selling or distribution of such products or services.Claims have been and may be asserted against Sony that its products or services,including third-party parts,components,software and
156、 network services used in Sonys products or services,infringe the intellectual propertyrights of other parties.Such claims may be asserted by competitors or by other rights holders,particularly asproducts and services evolve to include new technologies and enhanced functionality.Such claims might re
157、quireSony to enter into settlement or license agreements,pay significant damage awards,face an injunction or refrainfrom marketing,selling or distributing certain of its products and services.The failure to prevent unauthorized use or theft of Sonys intellectual property rights,the failure to enteri
158、nto licenses for necessary third-party intellectual property rights,the invalidation of Sonys intellectual propertyrights or the settlement of an infringement claim against Sony by others may adversely impact Sonys reputation,operating results and financial condition.Changes in consumer behavior res
159、ulting from new technologies and distribution platforms,as well asincreasing concentration of digital music distributors and creation of content by distributors themselves,mayadversely affect operating results in the Music and Pictures segments.Technology,particularly digital technology,used in the
160、Music and Pictures segments continues to evolve,rapidly leading to alternative methods and platforms for the discovery and consumption of digital content.Thesetechnological advancements have changed consumer behavior and empowered consumers to seek more controlover when,where and how they consume di
161、gital content.The prevalence of digital streaming networks and other new media may negatively impact traditionaltelevision and in-theater motion picture viewership,which could adversely affect operating results of the Picturessegment.Furthermore,as more music and video content is consumed over digit
162、al streaming networks,digital musicdistributors are becoming increasingly concentrated,which may decrease the competitiveness of Sonys musiccontent and adversely affect its pricing.In addition,digital music and video distributors may increase the amountof content they create for their own services,w
163、hich may reduce the demand for content created or produced bySony.If Sony is unable to adequately respond to these changes or fails to effectively adapt to new marketchanges,Sonys operating results and financial condition may be adversely impacted.Changes in the regulation and performance of financi
164、al markets may adversely affect the operating resultsand financial condition of the Financial Services segment.The Financial Services segment operates in industries subject to comprehensive regulation and supervision,including the Japanese insurance and banking industries.Future developments or chan
165、ges in laws,regulations orpolicies may lead to increased compliance costs or limitations on operations in the Financial Services segment.Inaddition,lending and borrowing between Sonys subsidiaries in the Financial Services segment and othercompanies within Sony Group is strictly limited by guideline
166、s issued by regulatory agencies in Japan.Changes in interest rates,foreign exchange rates and the value of Japanese government and corporate bonds,U.S.treasury bonds,equities,real estate and other asset classes may have an adverse effect on the operatingresults and financial condition of the Financi
167、al Services segment.For example,the life insurance business hasinvested most of its general account assets in ultra-long-term Japanese government and corporate bonds,as wellas ultra-long-term U.S.treasury bonds,to match the liability characteristics of the long-term maturity insurancepolicies it has
168、 underwritten.The life insurance business has guaranteed yields on outstanding policies while itsinvestment portfolio could be reduced by the market changes discussed above.The banking business has investedmost of its total loan balance,or over half of its total assets,in its mortgage loans account.
169、An increase in-12-non-performing loans or a decline in prices of the real estate collateral from the market changes discussed aboveor deterioration of credit quality may have an adverse effect on the operating results and financial conditionthrough an increase in the allowance for credit losses.The
170、market changes discussed above,Sonys management of these changes or the occurrence ofearthquakes,pandemic disease or other catastrophic events in Japan could expose the life and non-life insurancebusinesses to increasing costs or adverse impact on their ability to satisfy insurance contract liabilit
171、ies.Insurance contract liabilities are calculated based on many actuarial assumptions that are uncertain.Significant changes to these actuarial assumptions and the market changes discussed above may have an adverseeffect on the operating results and financial condition of the Financial Services segm
172、ent.The review ofassumptions for insurance contract liabilities is required at the end of each reporting period.Sonys facilities and operations are subject to damage and disruption as a result of catastrophic disasters,outages,pandemic diseases including COVID-19,or similar events that could lead to
173、 supply chain,manufacturing and other business disruptions and have an adverse impact on Sonys operating results.Sonys headquarters and many of Sonys most advanced manufacturing facilities,including those for imagesensors,are located in Japan,where the risk of earthquakes is relatively high.A major
174、earthquake in Japan,especially in Tokyo,the Tokai area or the Kyushu and Tohoku areas,where Sony headquarters,certain consumerelectronics product manufacturing sites and image sensor manufacturing sites,respectively,are located,couldcause substantial damage to Sonys business operations,including dam
175、age to buildings,machinery,equipmentand inventories,and the interruption of production at manufacturing facilities.For example,the earthquake ofApril 14,2016 and subsequent earthquakes in the Kumamoto region in Japan caused damage to an image sensormanufacturing site in Kyushu,which interrupted prod
176、uction at the site.In addition,offices and facilities used by Sony,its suppliers,service providers and business partners,includingthose used for network,telecommunications and information systems infrastructure,R&D,material procurement,manufacturing,motion picture and television production,logistics
177、,sales,and online and other services are locatedthroughout the world and are subject to possible destruction,temporary stoppage or disruption as a result ofunexpected catastrophic events such as natural disasters,pandemic diseases including COVID-19,terrorist attacks,armed conflicts,large-scale powe
178、r outages and large-scale fires.If any of these facilities or offices were toexperience a significant loss as a result of any of the above events,it may disrupt Sonys operations,delay design,development or production,interrupt shipments and postpone the recording of sales,and/or result in large expe
179、nsesto repair or replace these facilities or offices.For example,regarding the spread of COVID-19 beginning in the 2020calendar year,although restrictions including lockdowns have been lifted and the impact on economic activities haslessened around the world,if economic activity stagnates again due
180、to a future resurgence of infections,it couldadversely affect the procurement of components and raw materials,production,development,sale and distributionof Sonys products and services,resulting in a negative impact on Sonys operating results and financial position.Inthe G&NS segment,the production
181、of hardware could be adversely affected again due to issues in the componentsupply chain.In the Music segment,in-person concerts and other events could be restricted again,causing relatedrevenues to decrease.In the Pictures segment,if movie theaters are once again forced to close or limit their capa
182、city,Sonys theatrical revenues may decrease.Additionally,depending on the status of lockdowns or other anti-infectionmeasures,as well as future increases in infections,Sony may be impacted by delays in the production schedules ofnew motion pictures and television programming,as well as decreased adv
183、ertising revenue.The ET&S segmentcould continue to be adversely impacted by factory shutdowns or declines in factory utilization,supply chain issuesand the closure of retail stores globally.Sony may also be exposed to price increases for raw materials,parts and components,and lower demandfrom commer
184、cial customers.These situations may have an adverse impact on Sonys operating results andfinancial condition.In addition,extreme weather conditions may become more severe and frequent as thetemperature rises due to the effects of climate change,and such extreme weather conditions could heighten ther
185、isks and uncertainties noted above.Sonys brand image,reputation and business may be harmed and Sony may be subject to legal claims if thereis a breach or other compromise of Sonys information security or that of its third-party service providers orbusiness partners.Sony,its third-party service provi
186、ders,suppliers and other business partners make extensive use ofinformation technology to support business operations,and to provide network and online services to customers.These operations and services,as well as Sonys business information,may be intentionally or inadvertentlycompromised by malici
187、ous third parties,including state-sponsored organizations,criminal organizations,Sonys-13-officers or employees,third-party service providers or other business partners.Such organizations or individualsmay use a variety and combination of techniques,such as installing malicious software,exploiting v
188、ulnerabilitiesin information technology,using social engineering to mislead officers,employees and business partners intodisclosing passwords and sensitive information,and coordinating distributed denial-of-service attacks to renderservices unavailable.As cyber-attacks become increasingly sophistica
189、ted and automated,and as tools andresources become more readily available,there can be no guarantee that Sonys actions,security measures andcontrols designed to prevent,detect or respond to outside intrusion,limit access to data,prevent loss,destruction,alteration,or exfiltration of business informa
190、tion,or limit the negative impact from such attacks can provideabsolute security.In addition,Sonys officers or employees have been working both in the office and at homefollowing the spread of COVID-19 and this practice is expected to continue.Although Sony takes measures toensure that appropriate i
191、nformation security protections are in place for the remote workforce,there can be noguarantee that Sonys actions,security measures and controls designed to prevent,detect or respond to outsideintrusion,limit access to data,prevent loss,destruction,alteration,or exfiltration of business information,
192、or limitthe negative impact from such attacks,can provide absolute security.As a result,Sonys business information,including personally identifiable information,may be lost,destroyed,disclosed,misappropriated,altered,oraccessed without consent,and Sonys information technology systems or operations,o
193、r those of its serviceproviders or other business partners,may be disrupted.Malicious adversaries may also use unauthorized accessto Sonys networks as a platform to compromise Sonys third-party business partners without Sonys knowledge.Sony has previously been the subject of sophisticated and target
194、ed attacks.For example,network services in theG&NS segment,the internal network and IT infrastructure in the Pictures segment,and Sonys websites havebeen subject to cyber-attacks,resulting in unauthorized access,denial of service,and the theft and/or disclosureof Sonys business information,including
195、 officer and employee information,customer information,and otherinformation,as well as the destruction of data.Any of the above incidents can result in significant remediation costs.In addition,a disruption to Sonysnetwork and online services,information technology,or other compromise of its informa
196、tion security may haveserious consequences to its business and operations,including lost revenues,damage to relationships withbusiness partners and other third parties,disclosure,alteration,destruction or use of proprietary information andthe failure to retain or attract customers.Moreover,such disr
197、uptions and breaches may result in a diversion ofmanagements attention and resources.Further,it may result in adverse media coverage,which may harm Sonysbrand image and reputation.Sony may also be subject to legal claims or legal proceedings,including regulatoryinvestigations and actions.Sonys cyber
198、 insurance may not cover all expenses and losses and,accordingly,suchbreaches or other compromises of Sonys information security or that of its third-party service providers orbusiness partners may have an adverse impact on Sonys operating results and financial condition.Sonys reputation,operating r
199、esults and financial condition may be adversely affected as a result of adverseoutcomes of litigation and regulatory actions.Sony faces the risk of litigation and regulatory actions in different countries in connection with itsoperations.Legal proceedings,including regulatory actions,may seek to rec
200、over very large indeterminateamounts or to limit Sonys operations,and the possibility that they may arise and their magnitude may remainunknown for substantial periods of time.For example,legal proceedings,including regulatory actions,may resultfrom antitrust scrutiny of market practices for anti-co
201、mpetitive conduct.A substantial legal liability or adverseregulatory outcome and the substantial cost to defend the litigation or regulatory actions may have an adverseeffect on Sonys reputation,operating results and financial condition.Sony is subject to financial and reputational risks due to prod
202、uct quality,product security,and liability issues.Sonys products and services,such as consumer electronics products,non-consumer products,parts andcomponents,semiconductors,software and network services are becoming increasingly sophisticated andcomplicated as rapid advancements in technologies occu
203、r and as demand increases for mobile products andonline services.Also,many Sony products are connected to the internet,and regularly communicate withservices provided by Sony or third parties.Sonys efforts to adapt to rapid advancements in technologies and increased demand for mobile productsand onl
204、ine services,while also maintaining product quality and product security,may not be successful and mayincrease exposure to product liability.As a result,Sony may incur both reputational damages and expenses inconnection with,for example,product recalls and after-sales services.In addition,Sony may n
205、ot be successful inintroducing after-sales upgrades,enhancements or new features to existing products and services,or in enablingexisting products and services to continue to conveniently and effectively integrate with other technologies andonline services.Moreover,cyber-attacks targeting internet-c
206、onnected products have increased significantly.For-14-example,customer information and Sony or third-party technical information may be misappropriated,thefunctionality of Sonys products and services may be impaired,or Sony products may be used indenial-of-service attacks.There can be no guarantee t
207、hat Sonys security measures will prevent products frombeing compromised.As a result,the quality of Sonys existing products and services may not remain satisfactory to consumersand become less marketable,less competitive or obsolete,and Sonys reputation,operating results and financialcondition may be
208、 adversely affected.Moreover,allegations of security vulnerability,health and safety issuesrelated to Sony products,or lawsuits related to product quality,health issues arising from products or productsafety,regardless of merit,may adversely impact Sonys operating results and financial condition,eit
209、her directlyor as a result of the impact on Sonys brand image and reputation as a producer of high-quality products andservices.These issues are relevant to Sony products sold directly to customers,whether manufactured by Sony ora third party,and also to products of other companies that are equipped
210、 with Sonys components,such assemiconductors.Sonys financial results and condition may be adversely affected by its employee benefit obligations.Sony recognizes a net defined benefit liability or asset for its defined benefit pension plans based on(i)thepresent value of defined benefit obligations(“
211、DBO”)under each pension plan less(ii)the fair value of planassets,in accordance with the accounting guidance for defined benefit plans.If the fair value of plan assets is inexcess of the present value of DBO,the amount of any asset to be recognized is limited to the present value ofany economic bene
212、fits available in the form of refunds from the plan or reductions in the future contributions tothe plan.Any decrease in the fair value of plan assets or increases in the present value of DBO due to a lowerdiscount rate and changes in certain other actuarial assumptions may increase or decrease the
213、net defined benefitliability or asset and may have an adverse effect on Sonys financial results and condition.Also,Sonys financial results and condition could be adversely affected by future pension fundingrequirements pursuant to the Japanese Defined Benefit Corporate Pension Plan Act(the“Pension P
214、lan Act”).Under the Pension Plan Act,Sony is required to conduct a periodic actuarial revaluation and to ascertain whethercertain financial criteria have been met after the annual accounting closing.In the event that the fair value of planassets falls below the actuarial reserve required by law and
215、the shortfall may not be recovered within a certainmoratorium period permitted by laws and/or special legislative decree,Sony may be required to make anadditional contribution to its plans,which may reduce cash flows.Similarly,if Sony is required to make anadditional contribution to a foreign plan t
216、o meet any funding requirements in accordance with local laws andregulations in each country,Sonys cash flows might be adversely affected.If Sony is required to increase cashcontributions to its pension plans when actuarial assumptions,such as an expected long-term rate of return of theplan assets,a
217、re updated for purposes of determining statutory contributions,it may have an adverse impact onSonys cash flows.Further losses in tax jurisdictions where Sony has assessed deferred tax assets as unrecognized,the inabilityof Sony to fully utilize its deferred tax assets,limitations on the use of its
218、deferred tax assets under local law,exposure to additional tax liabilities or changes in Sonys tax rates could adversely affect Sonys operatingresults and financial condition.Sony is subject to income taxes in Japan and numerous other jurisdictions,and in the ordinary course of itsbusiness there are
219、 many situations where the ultimate tax determination can be uncertain,because of the transferpricing for its intercompany transactions,and because Sony is subject to continuous review by tax authorities ofnumerous jurisdictions.The calculation of Sonys tax provision and the carrying value of tax as
220、sets,including netoperating loss carryforwards and tax credit carryforwards,require significant judgment and the use of estimates,including estimates of future taxable income.At the end of each reporting period,Sony reassesses unrecognizeddeferred tax assets and determines whether these assets shoul
221、d be recognized.As of March 31,2023,theunrecognized deferred tax assets amounted to 237.3 billion yen.An increase in unrecognized deferred tax assetsmay have an adverse impact on Sonys operating results and financial condition.Deferred tax assets are evaluated on a jurisdiction by jurisdiction basis
222、.As of March 31,2023,Sony and/orits subsidiaries had unrecognized deferred tax assets,principally in Japan for local taxes.Additionally,deferredtax assets could expire unused or otherwise not be realizable for a variety of reasons including the lack ofsufficient taxable income in the appropriate jur
223、isdiction.Sonys operating results and financial condition couldbe adversely affected when the deferred tax assets expire unused.In some jurisdictions,the use of net operating loss carryforwards or tax credits to reduce taxable income in asubsequent period is limited to a fixed percentage of taxable
224、income or may only be used to offset taxes on-15-income from certain sources.Thus,it is possible that even with significant net operating loss carryforwards or taxcredits,Sony could record and pay taxes in a jurisdiction where it has taxable income.Sonys future effective tax rates may also be unfavo
225、rably affected by changes in both the statutory rates andthe mix of earnings in countries with differing statutory rates or by other factors such as changes in tax laws andregulations or their interpretation,including minimum tax requirements and limitations or restrictions on varioustax deductions
226、and credits,including deductions for royalties and interest.In addition to the above,Sonys businesses may be subject to new forms of gross basis taxation andtransactional taxes,including digital service taxes.Although such taxes may not directly impact Sonys effectivetax rate,they may nevertheless h
227、ave an adverse impact on its operating results and financial condition.Sony could incur asset impairment losses for goodwill,content assets and other intangible assets or othernon-current assets.Sony has a significant amount of goodwill,content assets,other intangible assets and other non-currentass
228、ets,including production facilities and equipment.A decline in financial performance,market capitalization,reduced estimates of future cash flows,changes in global economic conditions or changes in estimates andassumptions used in the impairment analysis,which in many cases requires significant judg
229、ment,could result inimpairment losses against these assets.Events or changes in circumstances which would indicate impairmentinclude unfavorable variances from or adjustments to established business plans,significant changes inforecasted results or volatility inherent to external markets and industr
230、ies.The increased levels of globalcompetition and the faster pace of technological change to which Sony is exposed can result in greater volatilityof these estimates,assumptions and judgments,and increase the likelihood of impairment losses.Any such lossmay adversely affect Sonys operating results a
231、nd financial condition.Holders of American Depositary Shares have fewer rights than shareholders and may not be able to enforcejudgments based on U.S.securities laws.The rights of shareholders under Japanese law to take actions,including voting their shares,receivingdividends and distributions,bring
232、ing derivative actions,examining Sonys accounting books and records,andexercising appraisal rights,are available only to shareholders of record.Because the depositary,through itscustodian agents,is the record holder of the shares underlying the American Depositary Shares(“ADSs”),onlythe depositary c
233、an exercise those rights in connection with the deposited shares.The depositary will make effortsto vote the shares underlying ADSs in accordance with the instructions of ADS holders and will pay thedividends and distributions collected from Sony.However,ADS holders will not be able to bring a deriv
234、ativeaction,examine Sonys accounting books and records,or exercise appraisal rights through the depositary.Sony Group Corporation is incorporated in Japan with limited liability.A majority of Sonys directors andcorporate executive officers are non-U.S.residents,and a substantial portion of the asset
235、s of Sony GroupCorporation and the assets of Sonys directors and corporate executive officers are located outside the U.S.As aresult,it may be more difficult for investors to enforce against Sony Group Corporation or such persons,judgments obtained in U.S.courts predicated upon civil liability provi
236、sions of the federal and state securitieslaws of the U.S.or similar judgments obtained in other courts outside Japan.There is doubt as to theenforceability in Japanese courts,in original actions or in actions for enforcement of judgments of U.S.courts,ofcivil liabilities predicated solely upon the f
237、ederal and state securities laws of the U.S.Prior notification under the Foreign Exchange and Foreign Trade Act of Japan may be required in the caseof an acquisition by a foreign investor of a certain portion of our shares.Because Sony is engaged in certain businesses designated by the Foreign Excha
238、nge and Foreign Trade Act ofJapan(the“FEFTA”)and its related cabinet orders and ministerial ordinances(collectively,the“Foreign ExchangeRegulations”),if a foreign investor intends to consummate an acquisition of shares of common stock of Sony GroupCorporation and that acquisition constitutes an“inwa
239、rd direct investment”under the Foreign Exchange Regulations,the foreign investor,subject to certain exemptions,must file a prior notification of such inward direct investmentwith the Minister of Finance and any other competent Ministers.Under the Foreign Exchange Regulations,an“inward direct investm
240、ent”includes an acquisition by a foreign investor of shares of common stock of Sony GroupCorporation,the consummation of which results in such foreign investor,in combination with any existingshareholding,directly or indirectly holding 1%or more of the total number of issued shares of common stock o
241、r thetotal number of voting rights of Sony Group Corporation,unless certain exemptions apply.If such prior notification is filed,the proposed acquisition may not be consummated until the prescribedscreening period expires.In some cases,the Ministers may extend the screening period,and may recommend
242、or-16-order any modification or the abandonment of such acquisition.In addition,if certain conditions includingthose prescribed in light of the national security of Japan under the Foreign Exchange Regulations are met,theMinisters may order the foreign investor to divest the shares acquired or take
243、other measures.Consequently,anyproposed acquisition by a foreign investor of shares of common stock of Sony Group Corporation that constitutesan“inward direct investment”may not be consummated in an expected time frame in accordance with anintended plan,or at all.Additionally,if a foreign investor d
244、irectly or indirectly holds 1%or more of the total voting rights of SonyGroup Corporation and,at a general meeting of shareholders,consents to certain proposals having a materialinfluence on the management of Sony Group Corporation such as the(i)election of such foreign investor or anyof its related
245、 persons(as defined in the Foreign Exchange Regulations)as a director of Sony Group Corporationor(ii)transfer or discontinuation of its business,such consent,subject to certain exemptions,also constitutes an“inward direct investment”requiring prior notification.If such prior notification is filed,su
246、ch consent cannot begiven until the prescribed screening period expires.As a result,such foreign investors may have difficultiesgiving such consent in accordance with an intended plan,or at all.The discussion above is not exhaustive of all possible foreign exchange controls considerations that mayap
247、ply to a particular investor,and potential investors are advised to satisfy themselves as to the overall foreignexchange controls consequences of the acquisition,ownership and disposition of shares of common stock orvoting rights of Sony Group Corporation by consulting their own advisors.For a more
248、detailed discussion on therequirements and procedures regarding the prior notifications under the Foreign Exchange Regulations,refer to“D.Exchange Controls”in“Item 10.Additional Information.”Item 4.Information on the CompanyA.History and Development of the CompanySony Group Corporation was establish
249、ed in Japan in May 1946 as Tokyo Tsushin Kogyo Kabushiki Kaisha,a joint stock company(Kabushiki Kaisha)under Japanese law.It changed its name to Sony Kabushiki Kaisha(“Sony Corporation”in English)in January 1958,and changed its name again to Sony Group Kabushiki Kaisha(“Sony Group Corporation”in Eng
250、lish)in April 2021 in order to focus on its role as the headquarters of the SonyGroup.In December 1958,Sony Group Corporation was listed on the Tokyo Stock Exchange(the“TSE”).In June1961,Sony Group Corporation issued American Depositary Receipts in the U.S.In March 1968,Sony Group Corporation establ
251、ished CBS/Sony Records Inc.in Japan,as a 50-50 jointventure company between Sony Group Corporation and CBS Inc.in the U.S.In January 1988,the joint venturebecame a wholly-owned subsidiary of Sony Group Corporation,and in April 1991,changed its name to SonyMusic Entertainment(Japan)Inc.(“SMEJ”).In No
252、vember 1991,SMEJ was listed on the Second Section of theTSE.In September 1970,Sony Group Corporation was listed on the New York Stock Exchange(the“NYSE”).In August 1979,Sony Group Corporation established Sony Prudential Life Insurance Co.,Ltd.in Japan,as a50-50 joint venture company between Sony Gro
253、up Corporation and The Prudential Insurance Company ofAmerica.In April 1991,the joint venture changed its name to Sony Life Insurance Co.,Ltd.(“Sony Life”).InMarch 1996,Sony Life became a wholly-owned subsidiary of Sony Group Corporation.In July 1984,Sony Magnescale Inc.,a subsidiary of Sony Group C
254、orporation,was listed on the SecondSection of the TSE.The subsidiary changed its name to Sony Precision Technology Inc.in October 1996 andthen to Sony Manufacturing Systems Corporation in April 2004.In April 2012,Sony Manufacturing Systemswas merged into Sony EMCS Corporation.Sony EMCS Corporation c
255、hanged its name to Sony GlobalManufacturing&Operations Corporation in April 2016.In July 1987,Sony Chemicals Corporation,a subsidiary of Sony Group Corporation,was listed on theSecond Section of the TSE.The subsidiary changed its name to Sony Chemical&Information DeviceCorporation in July 2006,and c
256、hanged its name again to Dexerials Corporation in October 2012.In January 1988,Sony Group Corporation acquired CBS Records Inc.,the music business division of CBSInc.in the U.S.The acquired company changed its name to Sony Music Entertainment Inc.in January 1991 andthen to Sony Music Holdings Inc.in
257、 December 2008.In November 1989,Sony Group Corporation acquired Columbia Pictures Entertainment,Inc.in the U.S.InAugust 1991,Columbia Pictures Entertainment,Inc.changed its name to Sony Pictures Entertainment Inc.(“SPE”).-17-In November 1993,Sony Group Corporation established Sony Computer Entertain
258、ment Inc.in Japan.SonyComputer Entertainment Inc.changed its name to Sony Interactive Entertainment Inc.in April 2016.In October 1995,Sony/ATV Music Publishing LLC(“Sony/ATV”)was formed as a 50-50 joint venturecompany between Sony Group Corporation and Michael Jackson.In September 2016,the joint ven
259、ture became awholly-owned subsidiary of Sony Group Corporation.In January 2021,Sony/ATV changed its name to SonyMusic Publishing(US)LLC.In January 2000,acquisition transactions by way of a share exchange were completed such that threesubsidiaries which had been listed on the TSE SMEJ,Sony Chemicals
260、Corporation(currently DexerialsCorporation),and Sony Precision Technology Inc.(currently Sony Global Manufacturing&OperationsCorporation)became wholly-owned subsidiaries of Sony Group Corporation.In September 2012,Sony GroupCorporation completed the sale of certain of its chemical products businesse
261、s,including Sony Chemical&Information Device Corporation(currently Dexerials Corporation)to Development Bank of Japan Inc.In October 2001,Sony Ericsson Mobile Communications AB(“Sony Ericsson”),a 50-50 joint venturecompany between Sony Group Corporation and Telefonaktiebolaget LM Ericsson(“Ericsson”
262、)of Sweden,wasestablished.In February 2012,Sony acquired Ericssons 50%equity interest in Sony Ericsson.As a result of theacquisition,Sony Ericsson became a wholly-owned subsidiary of Sony and changed its name to Sony MobileCommunications AB.In October 2002,Aiwa Co.,Ltd.(“Aiwa”),then a TSE-listed sub
263、sidiary,became a wholly-owned subsidiaryof Sony Group Corporation.In December 2002,Aiwa was merged into Sony Group Corporation.In June 2003,Sony Group Corporation adopted the“Company with Three Committees”corporategovernance system in line with the revised Japanese Commercial Code then effective.(Re
264、fer to“BoardPractices”in“Item 6.Directors,Senior Management and Employees.”)In April 2004,Sony Group Corporation established Sony Financial Holdings,Inc.(“SFH”),a financialholding company,in Japan.Sony Life,Sony Assurance Inc.(“Sony Assurance”),and Sony Bank Inc.(“SonyBank”)became subsidiaries of SF
265、H.In October 2007,SFH was listed on the First Section of the TSE inconjunction with the global initial public offering of shares of SFH by Sony Group Corporation and SFH.InSeptember 2020,SFH became a wholly-owned subsidiary of Sony Group Corporation through Sonys tenderoffer for the common shares an
266、d the related stock acquisition rights of SFH and the subsequent procedures forthe purchase of all of SFHs remaining common shares.In October 2021,SFH changed its company name toSony Financial Group Inc.(“SFGI”).In April 2004,S-LCD Corporation(“S-LCD”),a joint venture between Sony Group Corporation
267、andSamsung Electronics Co.,Ltd.of Korea for the manufacture of amorphous thin film transistor LCD(liquidcrystal display)panels,was established in Korea.Sonys stake in S-LCD was 50%minus 1 share.In January2012,Sony sold all of its shares of S-LCD to Samsung Electronics Co.,Ltd.In August 2004,Sony com
268、bined its worldwide recorded music business,excluding its recorded musicbusiness in Japan,with the worldwide recorded music business of Bertelsmann AG(“Bertelsmann”),forming a50-50 joint venture,SONY BMG MUSIC ENTERTAINMENT(“SONY BMG”).In October 2008,Sonyacquired Bertelsmanns 50%equity interest in
269、SONY BMG.As a result of the acquisition,SONY BMG becamea wholly-owned subsidiary of Sony.In January 2009,SONY BMG changed its name to Sony MusicEntertainment(“SME”).In December 2005,Sony Communication Network Corporation,a subsidiary of Sony Group Corporation,was listed on the Mothers market of the
270、TSE,and was later listed on the First Section of the TSE in January2008.It changed its name to So-net Entertainment Corporation in October 2006,and changed its name again toSo-net Corporation(“So-net”)in July 2013.In January 2013,Sony Group Corporation acquired all of thecommon shares of So-net thro
271、ugh a tender offer and subsequent share exchange and,as a result of theacquisition,So-net became a wholly-owned subsidiary of Sony Group Corporation.So-net was renamed SonyNetwork Communications Inc.(“SNC”)in July 2016.In June 2012,an investor group including Sony Corporation of America(“SCA”)establ
272、ished DH Publishing,L.P.(“EMI”)to own and manage EMI Music Publishing,which it then acquired.This acquisition resulted in NileAcquisition LLC(“Nile”),of which SCA owned 74.9%and the Estate of Michael Jackson(the“Estate”)owned25.1%,acquiring approximately 40%of the equity interest in EMI.In July 2018
273、,Sony completed the acquisition ofthe Estates equity interest in Nile,resulting in Sony owning approximately 40%of the equity interest in EMI.InNovember 2018,Sony completed the acquisition of the remaining approximately 60%equity interest in EMI,-18-resulting in EMI becoming a wholly-owned subsidiar
274、y of Sony.In January 2021,Nile changed its name to SonyMusic Publishing LLC(“SMP”).SMP encompasses both the former Sony/ATV and EMI.In April 2013,Sony Olympus Medical Solutions Inc.(“SOMED”),a medical business venture betweenSony Group Corporation and Olympus Corporation,was established in Japan.Son
275、ys stake in SOMED is 51%.In July 2014,Sony Group Corporation sold its personal computer(“PC”)business operated under the VAIObrand to Japan Industrial Partners,Inc.In July 2014,pursuant to a separation of Sonys businesses into distinct subsidiaries,the television businesswas split out and began oper
276、ations as Sony Visual Products Inc.In October 2015,the video and sound business was split out and began operations as Sony Video&SoundProducts Inc.(“SVS”).In April 2016,the imaging and sensing solutions business was split out and began operations as SonySemiconductor Solutions Corporation(“SSS”).In
277、April 2017,the imaging products and solutions business was split out and began operations as SonyImaging Products&Solutions Inc.(“SIPS”),which completed the sequential separation of Sonys business unitsinto distinct subsidiaries.In September 2017,Sony transferred its battery businesses to the Murata
278、 Manufacturing Co.,Ltd.Group.In April 2019,Sony Visual Products Inc.and SVS merged to become Sony Home Entertainment&SoundProducts Inc.(“SHES”).In April 2020,Sony established Sony Electronics Corporation,an intermediate holding companyencompassing the electronics products and solutions businesses.In
279、 April 2021,in connection with the above-mentioned launch of Sony Group Corporation,SonyElectronics Corporation,SHES,SIPS and Sony Mobile Communications Inc.(“SOMC”)were merged into onecompany,which was renamed Sony Corporation.Additionally,certain support functions for the electronicsproducts and s
280、olutions businesses and the imaging products and solutions business that had been carried out bySony Group Corporation were transferred to Sony Corporation and SSS.In April 2022,due to a restructuring of the segments of the TSE,Sony Group Corporation moved from theFirst Section to the Prime Market o
281、f the TSE.In July 2022,Sony Interactive Entertainment LLC acquired Bungie,an independent videogame developer inthe United States.In September 2022,Sony Honda Mobility Inc.(“Sony Honda Mobility”),a joint venture in the mobilityfield between Sony Group Corporation and Honda Motor Co.,Ltd.,was establis
282、hed in Japan.Sonys stake inSony Honda Mobility is 50%.Sony Group Corporations registered office is located at 7-1,Konan 1-chome,Minato-ku,Tokyo 108-0075,Japan,telephone+81-3-6748-2111.Its website is https:/ agent in the U.S.for purposes of this Item 4 is Sony Corporation of America,25 Madison Avenue
283、,26thFloor,New York,NY 10010-8601(Attn:Office of the General Counsel).Sony files reports and other information with the U.S.Securities and Exchange Commission(the“SEC”)pursuant to the SECs rules and regulations that apply to foreign private issuers.The SEC maintains a websitethat contains reports,pr
284、oxy and information statements,and other information regarding issuers that fileelectronically with the SEC.Sonys electronic filings are available for viewing on this website,athttps:/www.sec.gov.Principal Capital InvestmentsIn the fiscal years ended March 31,2022 and 2023,Sonys capital expenditures
285、 were 697.2 billion yen and809.6 billion yen,respectively.For a breakdown of principal capital expenditures and divestitures(includinginterests in other companies),refer to“Item 5.Operating and Financial Review and Prospects.”The fundingrequirements of such various capital expenditures are expected
286、to be financed by cash provided principally byoperating and financing activities or the existing balance of cash and cash equivalents.In the fiscal year ended March 31,2023,Sony invested approximately 381.1 billion yen in the I&SSsegment.This investment included approximately 355.9 billion yen to in
287、crease image sensor production capacity.-19-B.Business OverviewThe former Electronics Products&Solutions segment was renamed the Entertainment,Technology&Services(ET&S)segment effective from April 2022.This change did not result in any reclassification ofbusinesses across segments.Sony is engaged in
288、 the development,design,production,manufacture and sale of various kinds of electronicequipment,instruments and components for consumer,professional and industrial markets such as networkservices,game hardware and software,televisions,audio and video recorders and players,still and videocameras,mobi
289、le phones,and image sensors.Sony is engaged in the development,production,manufacture,anddistribution of recorded music and the management and licensing of the words and music of songs as well as theproduction and distribution of animation titles,including game applications based on animation titles
290、.Sony isalso engaged in the production,acquisition and distribution of motion pictures and television programming andthe operation of television and digital networks.Further,Sony is also engaged in various financial servicesbusinesses,including life and non-life insurance operations through its Japa
291、nese insurance subsidiaries andbanking operations through a Japanese internet-based banking subsidiary.Products and ServicesGame&Network Services(G&NS)Sony Interactive Entertainment LLC undertakes product research,development,design,marketing,sales,production,distribution and customer service for Pl
292、ayStationhardware,software,content and network services.The G&NS segment includes the Digital Software and Add-on Content,Network Services and Hardwareand Others categories.Digital Software and Add-on Content includes distribution of software titles and add-oncontent through the network by Sony Inte
293、ractive Entertainment;Network Services includes network servicesrelating to game,video and music content;and Hardware and Others includes home gaming consoles,packagedsoftware,game software sold bundled with home gaming consoles,peripheral devices and first-party software forthird-party platforms.Mu
294、sicRecorded Music:“Recorded Music”includes the distribution of physical and digital recorded music and revenue derived fromartistslive performances.SME,a global entertainment company,excluding Japan,is engaged primarily in thedevelopment,production,marketing and distribution of recorded music in all
295、 commercial formats and genres.SMEJ is an entertainment company focused on the Japanese market,which includes a Japanese domesticrecorded music business that produces recorded music and music videos through contracts with many artists inall music genres.Music Publishing:“Music Publishing”includes th
296、e management and licensing of the words and music of songs.SMP is aU.S.-based music publishing business that owns and acquires rights to musical compositions,exploiting andmarketing these compositions and receiving royalties or fees for their use.Visual Media and Platform:“Visual Media and Platform”
297、includes the production and distribution of animation titles and gameapplications,and various service offerings for music and visual products.These businesses are operated primarilyby SMEJ.PicturesMotion Pictures:“Motion Pictures”includes the worldwide production,acquisition and distribution of live
298、-action andanimated motion pictures.SPEs motion picture production organizations include Columbia Pictures,ScreenGems,TriStar Pictures,3000 Pictures,Sony Pictures Animation,Stage 6 Films,AFFIRM Films and SonyPictures Classics.SPE also operates Sony Pictures Imageworks,a visual effects and animation
299、unit,and managesa studio facility,Sony Pictures Studios,which includes post-production facilities.-20-Television Productions:“Television Productions”includes the worldwide production,acquisition and distribution of programming,including scripted series,unscripted“reality”or“light entertainment,”dayt
300、ime serials,game shows,animatedseries,made for television movies and miniseries and other programming.Media Networks:“Media Networks”includes the operation of television networks and direct-to-consumer(“DTC”)streamingservices worldwide.SPEs television networks around the world include SPNI,which ope
301、rates televisionnetworks in India,and Game Show Network,LLC,which operates a U.S.-based network delivered on cable,satellite and other distribution platforms.Digital networks include Crunchyroll,a streaming service based inNorth America primarily focused on anime content,and SonyLIV,a general entert
302、ainment streaming service inIndia.Entertainment,Technology&Services(ET&S)TV and Audio&Video:Sony Corporation undertakes product research,development,design,marketing,sales,production,distribution and customer services for televisions and video and sound products.Still and Video Cameras:Sony Corporat
303、ion undertakes product research,development,design,manufacturing,sales,distribution andcustomer service for interchangeable lens cameras,compact digital cameras,consumer and professional videocameras as well as display products such as projectors and medical equipment.Additionally,it is responsible
304、forthe broadcast/professional solutions business and the FeliCa contactless IC(integrated circuit)card technologybusiness.SOMED undertakes development support to provide comprehensive medical and imaging devicesolutions for operating rooms and other medical areas.Mobile Communications:Sony Corporati
305、on undertakes product research,development,design,marketing,sales,production,distribution and customer services for mobile phones,accessories and applications.SNC provides internetbroadband network services to subscribers as well as creates and distributes content through its portal services tovario
306、us electronics product platforms such as PCs and mobile phones.Imaging&Sensing Solutions(I&SS)SSS and its subsidiary Sony Semiconductor Manufacturing Corporation undertake product research,development,design,manufacturing,marketing,sales,production,distribution and customer services primarilyfor com
307、plementary metal oxide semiconductor(“CMOS”)image sensors,in addition to charge-coupled devices(CCDs),large-scale integration systems(LSIs)and other semiconductors.These CMOS image sensors are usedin a wide variety of applications,primarily smartphones,as well as other products such as digital camer
308、as andsecurity cameras,factory automation systems and automobiles.Financial ServicesSFGI conducts insurance,banking and other operations primarily through Sony Life,a Japanese lifeinsurance company,Sony Assurance,a Japanese non-life insurance company,and Sony Bank,a Japaneseinternet-based bank,which
309、 are all wholly-owned by SFGI.All OtherAll Other consists of various operating activities,including the disc manufacturing business outside ofJapan,and the recording media and storage media businesses.Sales and DistributionG&NS,ET&S and I&SSIn the G&NS segment,PlayStationhardware and peripheral devi
310、ces,software and content and networkservices are marketed and distributed by Sony Interactive Entertainment LLC,Sony Interactive Entertainment-21-Inc.and Sony Interactive Entertainment Europe Ltd.Digital software,including add-on content,is primarily soldvia the PlayStation Store,while software for
311、third-party platforms is sold via third-party distributors.Hardwareand physical software are sold both indirectly via third-party distributors as well as directly via PlayStationsproprietary website.Additionally,Bungie carries out marketing and distribution of its software,content andmerchandise und
312、er its own brand as an independent studio and publisher,with support from PlayStation.Sonys products and services in the ET&S and I&SS segments are primarily marketed throughout the worldunder the trademark“Sony.”In most cases,Sonys products in the ET&S and I&SS segments are sold to sales subsidiari
313、es of SonyGroup Corporation located in or responsible for sales in various countries and territories.These subsidiaries thensell those products to unaffiliated local distributors and dealers or through direct sales,such as through theinternet.Sony Corporation brings its mobile products to market thr
314、ough direct and indirect channels,such asthird-party cellular network carriers and retailers,as well as through its own website.In some regions,certainproducts and services are sold directly to local distributors by Sony Group Corporation.Sales of such products and services are particularly seasonal
315、 and vary significantly with the timing of newproduct introductions and the economic conditions of each country.Sales for the third quarter endingDecember 31 of each fiscal year are generally higher than other quarters of the same fiscal year mainly in theG&NS and ET&S segments due to demand during
316、the year-end holiday season.Japan:Sony Marketing Inc.markets consumer electronics products mainly through retailers.It also marketsprofessional electronics products and services.For electronic components,Sony sells products directly towholesalers and manufacturers.United States:Sony markets its elec
317、tronics products and services in these segments through Sony Electronics Inc.andother wholly-owned subsidiaries in the U.S.Europe:In Europe,Sonys products and services in these segments are marketed through sales subsidiaries includingSony Europe B.V.,which is headquartered in the United Kingdom and
318、 has branches in European countries.China:Sony markets products and services in these segments through Sony(China)Limited,Sony Corporation ofHong Kong Limited and other wholly-owned subsidiaries in China.Asia-Pacific:In Asia-Pacific,Sonys products and services in these segments are marketed through
319、sales subsidiariesincluding Sony India Private Limited,Sony Electronics of Korea Corporation,Sony Taiwan Limited and SonyElectronics Vietnam.Other Areas:In overseas areas other than the U.S.,Europe,China and Asia-Pacific,Sonys products and services in thesesegments are marketed through sales subsidi
320、aries including Sony Brasil Ltda.,Sony Middle East&Africa FZEin the United Arab Emirates and Sony de Mexico S.A.de C.V.MusicSME and SMEJ develop,produce,market,and distribute recorded music in various commercial formats.SME and its affiliates conduct business globally under“Columbia Records,”“Epic R
321、ecords,”“RCA Records”and other labels.SMEJ conducts business in Japan under“Sony Music Records,”“Epic Records Japan,”“SMERecords,”“Ki/oon Music,”“Sony Music Associated Records”and other labels.Sony owns and acquires rights to musical compositions,exploits and markets these compositions,receivesroyal
322、ties or fees for their use and conducts its music publishing business in countries other than Japan under theSony Music Publishing name.-22-SMEJ creates artwork and produces packaged home entertainment products including music and games.Italso organizes various events in Japan through Sony Music Com
323、munications Inc.and its affiliates.In addition,SMEJ produces,markets and distributes animation products and game applications based on animation titlesunder the Aniplex name.PicturesSPE generally retains all rights relating to the worldwide distribution of its internally produced motionpictures and
324、television programming,including rights for theatrical exhibition,home entertainment distribution,pay and free television and digital exhibition and other markets.SPE also acquires distribution rights to motionpictures and television programming produced by other companies,and jointly produces and d
325、istributes motionpictures and television programming with other studios,television networks and production companies.Theserights may be limited to particular geographic regions,specific forms of media or periods of time.Within the U.S.,SPE uses its own distribution service businesses,Sony Pictures R
326、eleasing and SonyPictures Classics,for the U.S.theatrical release of its motion pictures and for the theatrical release of motionpictures acquired from and produced by others.Outside the U.S.,SPE generally distributes and markets motion pictures through one of its Sony PicturesReleasing Internationa
327、l subsidiaries or affiliates.In certain countries,however,SPE has joint distribution orsub-distribution arrangements with other studios,or arrangements with independent local distributors or otherentities.The worldwide home entertainment distribution of SPEs motion pictures and television programmin
328、g(andproduct acquired or licensed from others)is handled through Sony Pictures Home Entertainment,except incertain countries where SPE has joint distribution or sub-distribution arrangements with other studios,orarrangements with independent local distributors.Product is distributed in various home
329、media formats includingDVD,Blu-ray Discand Digital Distribution.Digital Distribution includes electronic sell-through andvideo-on-demand distributed on digital platforms,cable networks and direct broadcast satellite(“DBS”)providers.The worldwide television distribution of SPEs motion pictures and te
330、levision programming(and productacquired or licensed from others)is handled through Sony Pictures Television.SPEs library of motion picturesand television programming is licensed to distributors such as broadcast television networks,digital platforms,cable networks and DBS providers.Digital platform
331、s include subscription and advertising supported platforms(including Sonys PlayStationNetwork,Netflix and Amazon Prime Video).SPEs television networks and streaming services(including Crunchyroll primarily in North America andSonyLIV in India)are distributed through digital platforms,cable,DBS provi
332、ders and telecommunicationscompanies to viewers around the world.These networks and services generate advertising,subscription and otherancillary revenues.Financial ServicesSony Life conducts its life insurance business primarily in Japan.Sony Lifes core business is providingdeath protection and oth
333、er insurance products to individuals,primarily through a consulting-based sales approachutilizing its experienced team of Lifeplannersales specialists as well as partner independent sales agents.SonyLife provides tailor-made life insurance products that are optimized for each customer.As of March 31,2023,Sony Life employed 5,402 Lifeplannersales specialists.Sony Life maintains an extensive service