Financial Data and Key Metrics Changes - Sales of continuing operations in FY 2025 Q3 increased by 1% year-on-year to JPY 3,713.7 billion, while operating income rose by 22% to JPY 515 billion, both record highs for the third quarter [3] - Net income increased by 11% to JPY 377.3 billion [3] - Full-year sales forecast was upwardly revised by 3% to JPY 12,300 billion, operating income forecast increased by 8% to JPY 1,540 billion, and net income forecast also increased by 8% to JPY 1,130 billion [3] Business Segment Data and Key Metrics Changes - **G&NS Segment**: FY 2025 Q3 sales decreased by 4% year-on-year, but operating income increased by 19% due to favorable foreign exchange rates and increased sales in network services and first-party software [4] - **Music Segment**: Sales increased by 13% year-on-year, with operating income rising by 9%, reaching a record high for the third quarter [9] - **Pictures Segment**: Sales decreased by 11% year-on-year, and operating income decreased by 9% due to the absence of blockbuster films compared to the previous year [11] - **ET&S Segment**: Sales decreased by 7% year-on-year, and operating income decreased by 23% due to lower sales, partially offset by improved operating expenses [13] - **I&SS Segment**: Sales increased by 21% year-on-year, and operating income increased by 35%, both record highs for the segment [15] Market Data and Key Metrics Changes - User engagement for PlayStation increased, with monthly active users rising by 2% to a record high of 132 million accounts [5] - Total playtime for the quarter increased by 0.4% year-on-year [5] - The global interchangeable lens camera market demand remained strong year-on-year, particularly in Asia [14] Company Strategy and Development Direction - The company aims to enhance its gaming and studio business by releasing new titles and leveraging successful franchises [8][10] - A strategic partnership with TCL was established to strengthen the home entertainment business through a joint venture [15][31] - The company plans to optimize its business portfolio and improve profitability while managing the impact of rising memory costs [17][69] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertain business environment but expressed confidence in the company's ability to manage and produce results [18] - Concerns regarding memory supply and the impact of AI on the entertainment industry were discussed, with a focus on leveraging AI for content creation [26][53][78] Other Important Information - The company increased its share repurchase facility from JPY 100 billion to JPY 150 billion, reflecting confidence in its earnings and cash flow [18][68] - The acquisition of an additional equity interest in Peanuts Holdings was highlighted as a strategic initiative to enhance brand value [12] Q&A Session Summary Question: About the game "Marathon" and its strategic significance - Management explained that user feedback led to modifications before the release, emphasizing the importance of live service games for recurring revenue [22][24] Question: Concerns about stock price performance - Management acknowledged market concerns regarding memory supply and the entertainment sector's performance, emphasizing a focus on improving fundamentals and profitability [25][27] Question: ET&S structural reform and home entertainment partnership - Management clarified that the partnership with TCL aims to optimize the home entertainment business, with details still being discussed [30][32] Question: Impact of rising memory prices on PS5 - Management indicated that while there may be some impact on hardware sales, the established software and network service revenue will continue to contribute significantly [33][35] Question: Music streaming revenue growth prospects - Management expressed confidence in continued growth in the music business, driven by increasing average revenue per user and user numbers [39] Question: Generative AI's impact on game development - Management viewed AI as a tool that can enhance creativity in game development, emphasizing the importance of integrating AI with artistic sensitivity [77][78]

February 5, 2026 Q3 FY2025 Consolidated Financial Results (Three months ended December 31, 2025) Sony Group Corporation Changes in Disclosure Classification of Consolidated Results Changes in Disclosure Classification of Consolidated Results Previous Disclosure Classification Disclosure Classification Before the Execution of the Spin-off (1H FY25) Disclosure Classification After the Execution of the Spin-off (2H FY25) FY24*1 FY25 G&NS Music Pictures ET&S I&SS All other / Corporate and elimination*2 Financia ...

Financial Performance Summary - Q2 FY2025 sales for continuing operations increased by 1367 billion yen, a 5% increase year-on-year[8, 10] - Operating income for Q2 FY2025 increased by 396 billion yen, a 10% increase year-on-year[8, 10] - Net income attributable to Sony Group Corporation's stockholders increased by 197 billion yen, a 7% increase year-on-year[8] - FY2025 sales forecast revised upward by 300 billion yen, a 3% increase from the August forecast[12, 13] - FY2025 operating income forecast revised upward by 100 billion yen, an 8% increase from the August forecast[12, 13] Segment Performance - Game & Network Services (G&NS) sales increased by 416 billion yen, a 4% increase year-on-year, but operating income decreased by 185 billion yen, a 13% decrease[11, 21] - Music segment sales increased by 942 billion yen, a 21% increase year-on-year, and operating income increased by 250 billion yen, a 28% increase[11, 25] - Imaging & Sensing Solutions (I&SS) sales increased by 791 billion yen, a 15% increase year-on-year, and operating income increased by 459 billion yen, a 50% increase[11, 44] - Entertainment, Technology & Services (ET&S) sales decreased by 440 billion yen, a 7% decrease year-on-year, and operating income decreased by 92 billion yen, a 13% decrease[11, 36] Strategic Changes - Sony executed a partial spin-off of Sony Financial Group Inc (SFGI) effective October 1, 2025, classifying the Financial Services business as a discontinued operation[7] - From Q3 FY25, Sony will apply the equity method to SFGI shares and record profit or loss from SFGI shares as operating income in continuing operations[7]

Financial Performance - Q1 FY2025 Results (Continuing Operations) - Sales increased by 563 billion yen (+2%) year-on-year to 26216 billion yen, with an approximately 8% increase on a constant currency basis[6, 8] - Operating income increased by 908 billion yen (+36%) year-on-year to 3400 billion yen, with operating income margin at 130%, a 33 percentage point increase[6] - Net income attributable to Sony Group Corporation's stockholders increased by 489 billion yen (+23%) to 2590 billion yen[6] Segment Performance - Q1 FY2025 - Game & Network Services (G&NS) sales increased by 716 billion yen (+8%) to 9365 billion yen, and operating income increased by 827 billion yen (+127%) to 1480 billion yen[9, 22] - Music sales increased by 233 billion yen (+5%) to 4653 billion yen, and operating income increased by 69 billion yen (+8%) to 928 billion yen[9, 26] - Pictures sales decreased by 102 billion yen (-3%) to 3271 billion yen, but operating income increased by 74 billion yen (+65%) [9, 30] - Entertainment, Technology & Services (ET&S) sales decreased by 667 billion yen (-11%) to 5343 billion yen, and operating income decreased by 209 billion yen (-33%) to 431 billion yen[9, 39] - Imaging & Sensing Solutions (I&SS) sales increased by 547 billion yen (+15%) to 4082 billion yen, and operating income increased by 176 billion yen (+48%) to 543 billion yen[9, 44, 47] FY2025 Forecast (Continuing Operations) - Sales forecast remains unchanged at 117 trillion yen[10, 16] - Operating income forecast increased by 50 billion yen (+4%) to 133 trillion yen after considering a 70 billion yen estimated tariff impact[10, 11, 16] - Net income attributable to Sony Group Corporation's stockholders forecast increased by 40 billion yen (+4%) to 970 billion yen[10, 15] Spin-off of Financial Services Business - Sony plans to execute a partial spin-off of Sony Financial Group Inc (SFGI) in October 2025, classifying the Financial Services business as a discontinued operation from Q1 FY25[3, 4] - A considerable one-time loss will be recorded in the consolidated statements of income at the time of the execution of the Spin-off, but there will be no impact on operating income and net income from continuing operations[52]

Financial Data and Key Metrics Changes - Consolidated sales for Q3 FY 2023 reached ¥3,747.5 billion, a significant increase of 22% year-on-year, marking a record high for the quarter [5] - Consolidated operating income increased by ¥41.8 billion year-on-year to ¥463.3 billion, the second highest quarterly level [5] - Net income rose by ¥42.4 billion year-on-year to ¥363.9 billion, while adjusted EBITDA increased by ¥75.5 billion to ¥605 billion [5][6] - The nine-month cumulative consolidated operating cash flow, excluding the Financial Services segment, was ¥618.5 billion [6] Business Segment Data and Key Metrics Changes Game & Network Services (G&NS) - Q3 sales increased by 16% year-on-year to ¥1,444.4 billion, driven by higher third-party software sales and favorable foreign exchange rates [8] - Operating income decreased by ¥30.1 billion year-on-year to ¥86.1 billion due to lower profitability of PlayStation 5 hardware [10] - PS5 hardware unit sales reached 8.2 million units in the quarter, falling short of the annual target of 25 million units but achieving record quarterly sales [12] Music Segment - Q3 sales increased by 16% year-on-year to ¥422.1 billion, with operating income rising by ¥13.1 billion to ¥76.1 billion [20] - Streaming revenue grew by 12% for Recorded Music and 17% for Music Publishing [21] Pictures Segment - Q3 sales increased by 10% year-on-year to ¥366.3 billion, with operating income rising significantly by ¥16.2 billion to ¥41.6 billion [26] - The impact of Hollywood strikes is expected to peak next fiscal year, affecting profits [29] Entertainment, Technology & Services Segment - Q3 sales decreased by 2% year-on-year to ¥735.7 billion, with operating income down by ¥3.9 billion to ¥77.2 billion [32] Imaging & Sensing Solutions Segment - Q3 sales increased by 21% year-on-year to ¥505.2 billion, with operating income rising by ¥14.9 billion to ¥99.7 billion, both record highs for the segment [37] Financial Services Segment - Q3 revenue increased by ¥287.3 billion year-on-year to ¥311.7 billion, with operating income rising by ¥30.2 billion to ¥77.3 billion [44] Market Data and Key Metrics Changes - Monthly active users (MAU) for gaming reached a record high of 120 million accounts, with total gameplay time increasing by 13% year-on-year [13] - The cumulative sales of Marvel's Spider-Man 2 exceeded 10 million copies, contributing significantly to profits [14] Company Strategy and Development Direction - The company aims to optimize sales of PS5 hardware while balancing profitability, anticipating a gradual decline in unit sales from the next fiscal year [16] - Focus on producing high-quality first-party software and developing live service games, with no major franchise titles planned for next fiscal year [18] - The company plans to expand opportunities in the music business through strategic acquisitions and collaborations [25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about achieving stable revenue growth in the Music segment due to the expansion of the streaming market [22] - The company expects operating income for the next fiscal year to slightly increase in the G&NS segment, despite anticipated declines in first-party software profits [48] - The impact of Hollywood strikes on profits is expected to peak next fiscal year, but the company aims for operating income to exceed the current fiscal year [49] Other Important Information - The company is preparing for a spinoff and listing of shares for Sony Financial Group, Inc. in October 2025 [51] Q&A Session Summary Question: Strategic investment and CapEx for the current mid-range plan - The cumulative CapEx for FY '21 to FY '23 is expected to be about ¥1.9 trillion, with M&A and strategic investments at ¥1.8 trillion [56] Question: Spin-off purpose and relationship with business improvement - The spin-off aims to streamline capital allocation and allow both companies to grow independently [62] Question: Market trends for cameras in different regions - Sales in North America and Europe are performing relatively well, with no significant inventory issues reported [79] Question: Expectations for MAU growth and profitability - MAU growth is attributed to seasonality and successful free-to-play titles, with a profit shift of approximately ¥30 billion expected to the fourth quarter [94] Question: Future profitability and margin improvement strategies - The company aims to balance hardware pricing and profitability while focusing on strong first-party content to enhance margins [109]