Form 6-K Sony Group Corp For: Feb 02

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February 2, 2023 6:06 AM EST

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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of FEBRUARY 2023

Commission File Number: 001-06439

SONY GROUP CORPORATION

(Translation of registrant's name into English)

1-7-1 KONAN, MINATO-KU, TOKYO, 108-0075, JAPAN

(Address of principal executive offices)

The registrant files annual reports under cover of Form 20-F.

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F,

Form 20-F X

Form 40-F __

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934, Yes No X

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82-______

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SONY GROUP CORPORATION
	(Registrant)


	By: /s/ Hiroki Totoki
	(Signature)
	Hiroki Totoki
	Executive Deputy President and
	Chief Financial Officer

Date: February 2, 2023

List of materials

Documents attached hereto:

i) Press release: Quarterly Financial Statements for the Third Quarter Ended December 31, 2022 And Outlook for the Fiscal Year Ending March 31, 2023

Quarterly Financial Statements

for the Third Quarter Ended December 31, 2022

And

Outlook for the Fiscal Year Ending March 31, 2023

February 2, 2023

Sony Group Corporation

Quarterly Financial Statements (Unaudited)	F-1

Condensed Consolidated Statements of Financial Position	F-1
Condensed Consolidated Statements of Income (Three months ended December 31)	F-3
Condensed Consolidated Statements of Comprehensive Income (Three months ended December 31)	F-4
Condensed Consolidated Statements of Income (Nine months ended December 31)	F-5
Condensed Consolidated Statements of Comprehensive Income (Nine months ended December 31)	F-6
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Nine months ended December 31)	F-7
Condensed Consolidated Statements of Cash Flows (Nine months ended December 31)	F-8
Notes to Condensed Consolidated Financial Statements	F-10
- Business Segment Information	F-10
- Going Concern Assumption	F-20
- Accounting Policy and Other Information	F-20


Outlook for the Fiscal Year Ending March 31, 2023	1

Cautionary Statement	4

All financial information is presented on the basis of International Financial Reporting Standards (“IFRS”).

Sony Group Corporation and its consolidated subsidiaries are together referred to as “Sony” or “Sony Group”.

(Unaudited)

Condensed Consolidated Financial Statements

Condensed Consolidated Statements of Financial Position

	Yen in millions
	March 31, 2022		December 31, 2022		Change from March 31, 2022
ASSETS
Current assets:
Cash and cash equivalents		2,049,636		1,287,980		(761,656	)
Investments and advances in the Financial Services segment		360,673		323,390		(37,283	)
Trade and other receivables, and contract assets		1,628,521		1,978,985		350,464
Inventories		874,007		1,464,515		590,508
Other financial assets		149,301		144,626		(4,675	)
Other current assets		473,070		566,819		93,749
Total current assets		5,535,208		5,766,315		231,107
Non-current assets:
Investments accounted for using the equity method		268,513		317,405		48,892
Investments and advances in the Financial Services segment		18,445,088		17,504,209		(940,879	)
Property, plant and equipment		1,113,213		1,280,372		167,159
Right-of-use assets		413,430		429,392		15,962
Goodwill		952,895		1,267,100		314,205
Content assets		1,342,046		1,565,222		223,176
Other intangible assets		450,103		556,210		106,107
Deferred insurance acquisition costs		676,526		690,374		13,848
Deferred tax assets		298,589		338,882		40,293
Other financial assets		696,306		849,047		152,741
Other non-current assets		289,050		307,962		18,912
Total non-current assets		24,945,759		25,106,175		160,416
Total assets		30,480,967		30,872,490		391,523

(Continued on the following page.)

F-1

Condensed Consolidated Statements of Financial Position (Continued)

	Yen in millions
	March 31, 2022			December 31, 2022			Change from March 31, 2022
LIABILITIES
Current liabilities:
Short-term borrowings		1,976,553			2,092,624			116,071
Current portion of long-term debt		171,409			193,414			22,005
Trade and other payables		1,843,242			2,024,291			181,049
Deposits from customers in the banking business		2,886,361			3,071,144			184,783
Income taxes payables		106,092			176,730			70,638
Participation and residual liabilities in the Pictures segment		190,162			215,503			25,341
Other financial liabilities		97,843			82,497			(15,346	)
Other current liabilities		1,488,488			1,640,632			152,144
Total current liabilities		8,760,150			9,496,835			736,685
Non-current liabilities:
Long-term debt		1,203,646			1,514,355			310,709
Defined benefit liabilities		254,548			249,437			(5,111	)
Deferred tax liabilities		696,492			170,680			(525,812	)
Future insurance policy benefits and other		7,039,034			7,191,165			152,131
Policyholders’ account in the life insurance business		4,791,295			4,907,618			116,323
Participation and residual liabilities in the Pictures segment		220,113			205,579			(14,534	)
Other financial liabilities		211,959			339,652			127,693
Other non-current liabilities		106,481			123,394			16,913
Total non-current liabilities		14,523,568			14,701,880			178,312
Total liabilities		23,283,718			24,198,715			914,997
EQUITY
Sony Group Corporation’s stockholders’ equity:
Common stock		880,365			880,365			–
Additional paid-in capital		1,461,053			1,458,208			(2,845	)
Retained earnings		3,760,763			4,468,327			707,564
Accumulated other comprehensive income		1,222,332			30,078			(1,192,254	)
Treasury stock, at cost		(180,042	)		(220,260	)		(40,218	)
Equity attributable to Sony Group Corporation’s stockholders		7,144,471			6,616,718			(527,753	)
Noncontrolling interests		52,778			57,057			4,279
Total equity		7,197,249			6,673,775			(523,474	)
Total liabilities and equity		30,480,967			30,872,490			391,523

F-2

Condensed Consolidated Statements of Income

	Yen in millions
	Three months ended December 31
	2021			2022			Change
Sales and financial services revenue:
Sales		2,562,227			3,056,183			493,956
Financial services revenue		469,092			356,731			(112,361	)
Total sales and financial services revenue		3,031,319			3,412,914			381,595
Costs and expenses:
Cost of sales		1,787,301			2,161,904			374,603
Selling, general and administrative		423,509			529,188			105,679
Financial services expenses		433,761			301,924			(131,837	)
Other operating (income) expense, net		(70,960	)		(1,484	)		69,476
Total costs and expenses		2,573,611			2,991,532			417,921
Share of profit (loss) of investments accounted for using the equity method		7,475			7,355			(120	)
Operating income		465,183			428,737			(36,446	)
Financial income		4,962			6,943			1,981
Financial expenses		8,576			37,101			28,525
Income before income taxes		461,569			398,579			(62,990	)
Income taxes		113,645			70,073			(43,572	)
Net income		347,924			328,506			(19,418	)

Net income attributable to
Sony Group Corporation’s stockholders		346,161			326,809			(19,352	)
Noncontrolling interests		1,763			1,697			(66	)

	Yen
	Three months ended December 31
	2021		2022		Change
Per share data:
Net income attributable to Sony Group Corporation’s stockholders
- Basic		279.23		264.56		(14.67	)
- Diluted		276.65		263.89		(12.76	)

F-3

Condensed Consolidated Statements of Comprehensive Income

	Yen in millions
	Three months ended December 31
	2021			2022			Change
Net income		347,924			328,506			(19,418	)
Other comprehensive income, net of tax -
Items that will not be reclassified to profit or loss
Changes in equity instruments measured at fair value through other comprehensive income		(40,247	)		5,988			46,235
Remeasurement of defined benefit pension plans		1,870			10			(1,860	)
Share of other comprehensive income of investments accounted for using the equity method		395			(141	)		(536	)
Items that may be reclassified subsequently to profit or loss
Changes in debt instruments measured at fair value through other comprehensive income		23,242			(316,021	)		(339,263	)
Cash flow hedges		671			10,128			9,457
Insurance contract valuation adjustments		21			685			664
Exchange differences on translating foreign operations		54,388			(223,403	)		(277,791	)
Share of other comprehensive income of investments accounted for using the equity method		338			(1,649	)		(1,987	)
Total other comprehensive income, net of tax		40,678			(524,403	)		(565,081	)
Comprehensive income		388,602			(195,897	)		(584,499	)

Comprehensive income attributable to
Sony Group Corporation’s stockholders		385,770			(194,860	)		(580,630	)
Noncontrolling interests		2,832			(1,037	)		(3,869	)

F-4

Condensed Consolidated Statements of Income

	Yen in millions
	Nine months ended December 31
	2021			2022			Change
Sales and financial services revenue:
Sales		6,410,143			7,523,263			1,113,120
Financial services revenue		1,247,384			953,024			(294,360	)
Total sales and financial services revenue		7,657,527			8,476,287			818,760
Costs and expenses:
Cost of sales		4,401,169			5,241,857			840,688
Selling, general and administrative		1,138,719			1,418,411			279,692
Financial services expenses		1,144,840			767,117			(377,723	)
Other operating (income) expense, net		(70,847	)		(12,278	)		58,569
Total costs and expenses		6,613,881			7,415,107			801,226
Share of profit (loss) of investments accounted for using the equity method		20,064			18,562			(1,502	)
Operating income		1,063,710			1,079,742			16,032
Financial income		14,989			19,862			4,873
Financial expenses		50,821			63,893			13,072
Income before income taxes		1,027,878			1,035,711			7,833
Income taxes		252,443			221,228			(31,215	)
Net income		775,435			814,483			39,048

Net income attributable to
Sony Group Corporation’s stockholders		771,096			808,968			37,872
Noncontrolling interests		4,339			5,515			1,176

	Yen
	Nine months ended December 31
	2021		2022		Change
Per share data:
Net income attributable to Sony Group Corporation’s stockholders
- Basic		622.03		654.41		32.38
- Diluted		616.00		651.11		35.11

F-5

Condensed Consolidated Statements of Comprehensive Income

	Yen in millions
	Nine months ended December 31
	2021			2022			Change
Net income		775,435			814,483			39,048
Other comprehensive income, net of tax -
Items that will not be reclassified to profit or loss
Changes in equity instruments measured at fair value through other comprehensive income		(70,656	)		(9,520	)		61,136
Remeasurement of defined benefit pension plans		118			39			(79	)
Share of other comprehensive income of investments accounted for using the equity method		341			131			(210	)
Items that may be reclassified subsequently to profit or loss
Changes in debt instruments measured at fair value through other comprehensive income		65,773			(1,343,733	)		(1,409,506	)
Cash flow hedges		1,598			17,719			16,121
Insurance contract valuation adjustments		157			1,624			1,467
Exchange differences on translating foreign operations		69,019			140,581			71,562
Share of other comprehensive income of investments accounted for using the equity method		355			2,792			2,437
Total other comprehensive income, net of tax		66,705			(1,190,367	)		(1,257,072	)
Comprehensive income		842,140			(375,884	)		(1,218,024	)

Comprehensive income attributable to
Sony Group Corporation’s stockholders		836,770			(383,338	)		(1,220,108	)
Noncontrolling interests		5,370			7,454			2,084

F-6

Condensed Consolidated Statements of Changes in Stockholders’ Equity

	Yen in millions
	Common stock		Additional paid-in capital		Retained earnings		Accumulated other comprehensive income		Treasury stock, at cost		Sony Group Corporation’s stockholders’ equity		Noncontrolling interests		Total equity
Balance at April 1, 2021		880,214	1,489,597		2,914,503		1,520,257		(124,228	)	6,680,343		43,996		6,724,339
Comprehensive income:
Net income					771,096						771,096		4,339		775,435
Other comprehensive income, net of tax							65,674				65,674		1,031		66,705
Total comprehensive income					771,096		65,674				836,770		5,370		842,140
Transfer to retained earnings					6,187		(6,187	)			–				–
Transactions with stockholders and other:
Issuance of new shares		151	151								302				302
Exercise of stock acquisition rights			479						9,141		9,620				9,620
Conversion of convertible bonds			(2,672	)	(521	)			16,439		13,246				13,246
Stock-based compensation			3,858								3,858				3,858
Dividends declared					(74,385	)					(74,385	)	(2,646	)	(77,031	)
Purchase of treasury stock									(50,498	)	(50,498	)			(50,498	)
Reissuance of treasury stock			1,543						1,747		3,290				3,290
Transactions with noncontrolling interests shareholders and other			(36,377	)							(36,377	)	4,060		(32,317	)
Balance at December 31, 2021		880,365	1,456,579		3,616,880		1,579,744		(147,399	)	7,386,169		50,780		7,436,949

	Yen in millions
	Common stock		Additional paid-in capital		Retained earnings		Accumulated other comprehensive income		Treasury stock, at cost		Sony Group Corporation’s stockholders’ equity		Noncontrolling interests		Total equity
Balance at April 1, 2022		880,365	1,461,053		3,760,763		1,222,332		(180,042	)	7,144,471		52,778		7,197,249
Comprehensive income:
Net income					808,968						808,968		5,515		814,483
Other comprehensive income, net of tax							(1,192,306	)			(1,192,306	)	1,939		(1,190,367	)
Total comprehensive income					808,968		(1,192,306	)			(383,338	)	7,454		(375,884	)
Transfer to retained earnings					(52	)	52				–				–
Transactions with stockholders and other:
Exercise of stock acquisition rights			(6	)	(859	)			5,696		4,831				4,831
Conversion of convertible bonds			(2,588	)	(13,858	)			42,993		26,547				26,547
Stock-based compensation			7,413								7,413				7,413
Dividends declared					(86,635	)					(86,635	)	(5,470	)	(92,105	)
Purchase of treasury stock									(91,307	)	(91,307	)			(91,307	)
Reissuance of treasury stock			1,234						2,400		3,634				3,634
Transactions with noncontrolling interests shareholders and other			(8,898	)							(8,898	)	2,295		(6,603	)
Balance at December 31, 2022		880,365	1,458,208		4,468,327		30,078		(220,260	)	6,616,718		57,057		6,673,775

F-7

Condensed Consolidated Statements of Cash Flows

	Yen in millions
	Nine months ended December 31
	2021			2022
Cash flows from operating activities:
Income before income taxes		1,027,878			1,035,711
Adjustments to reconcile income before income taxes to net cash provided by (used in) operating activities:
Depreciation and amortization, including amortization of contract costs		620,115			735,642
Amortization of deferred insurance acquisition costs		46,605			82,169
Other operating (income) expense, net		(70,847	)		(12,278	)
Loss on securities, net (other than Financial Services segment)		23,606			27,154
Share of profit of investments accounted for using the equity method, net of dividends		(11,588	)		(12,166	)
Change in future insurance policy benefits and other		300,632			156,149
Change in policyholders’ account in the life insurance business, less cash impact		291,078			(148,264	)
Net cash impact of policyholders’ account in the life insurance business		153,714			263,986
Changes in assets and liabilities:
Increase in trade receivables and contract assets		(428,153	)		(283,431	)
Increase in inventories		(134,997	)		(572,541	)
Increase in investments and advances in the Financial Services segment		(1,145,193	)		(908,293	)
Increase in content assets		(407,502	)		(485,450	)
Increase in deferred insurance acquisition costs		(83,383	)		(88,976	)
Increase in trade payables		140,852			62,428
Increase in deposits from customers in the banking business		164,387			194,976
Increase in borrowings in the life insurance business and the banking business		478,305			100,670
Decrease in taxes payable other than income taxes, net		(13,837	)		(34,912	)
(Increase) decrease in other financial assets and other current assets		13,599			(36,093	)
Increase in other financial liabilities and other current liabilities		9,571			95,185
Income taxes paid		(154,491	)		(183,097	)
Other		(11,750	)		(70,192	)
Net cash provided by (used in) operating activities		808,601			(81,623	)

(Continued on the following page.)

F-8

Condensed Consolidated Statements of Cash Flows (Continued)

	Yen in millions
	Nine months ended December 31
	2021			2022
Cash flows from investing activities:
Payments for property, plant and equipment and other intangible assets		(338,553	)		(434,748	)
Proceeds from sales of property, plant and equipment and other intangible assets		8,038			9,474
Payments for investments and advances (other than Financial Services segment)		(63,201	)		(185,577	)
Proceeds from sales or return of investments and collections of advances (other than Financial Services segment)		23,033			11,740
Payments for purchases of businesses		(224,970	)		(280,447	)
Proceeds from sales of businesses		64,609			1,221
Other		7,820			20,814
Net cash used in investing activities		(523,224	)		(857,523	)
Cash flows from financing activities:
Increase in short-term borrowings, net		1,381			27,765
Proceeds from issuance of long-term debt		18,370			348,565
Payments of long-term debt		(161,721	)		(106,328	)
Dividends paid		(74,208	)		(86,383	)
Payments for purchases of treasury stock		(50,498	)		(91,307	)
Other		(12,019	)		7,036
Net cash provided by (used in) financing activities		(278,695	)		99,348
Effect of exchange rate changes on cash and cash equivalents		28,914			78,142
Net increase (decrease) in cash and cash equivalents		35,596			(761,656	)
Cash and cash equivalents at beginning of the fiscal year		1,786,982			2,049,636
Cash and cash equivalents at end of the period		1,822,578			1,287,980

F-9

Notes to Condensed Consolidated Financial Statements

Business Segment Information

(Business Segments)

Segment sales and financial services revenue

	Yen in millions
	Three months ended December 31
	2021			2022			Change
Sales and financial services revenue:
Game & Network Services -
Customers		796,734			1,211,617			414,883
Intersegment		16,530			34,932			18,402
Total		813,264			1,246,549			433,285
Music -
Customers		292,371			360,643			68,272
Intersegment		3,502			3,104			(398	)
Total		295,873			363,747			67,874
Pictures -
Customers		460,314			330,925			(129,389	)
Intersegment		920			612			(308	)
Total		461,234			331,537			(129,697	)
Entertainment, Technology & Services -
Customers		679,595			742,480			62,885
Intersegment		7,351			10,343			2,992
Total		686,946			752,823			65,877
Imaging & Sensing Solutions -
Customers		305,885			386,400			80,515
Intersegment		18,928			30,751			11,823
Total		324,813			417,151			92,338
Financial Services -
Customers		469,092			356,731			(112,361	)
Intersegment		2,254			2,301			47
Total		471,346			359,032			(112,314	)
All Other -
Customers		23,387			19,648			(3,739	)
Intersegment		4,041			5,412			1,371
Total		27,428			25,060			(2,368	)
Corporate and elimination		(49,585	)		(82,985	)		(33,400	)
Consolidated total		3,031,319			3,412,914			381,595

　　Game & Network Services (“G&NS”) intersegment amounts primarily consist of transactions with the Entertainment, Technology & Services (“ET&S”) segment. ET&S intersegment amounts primarily consist of transactions with the G&NS segment. Imaging & Sensing Solutions (“I&SS”) intersegment amounts primarily consist of transactions with the G&NS segment and the ET&S segment. Corporate and elimination includes certain brand and patent royalty income.

F-10

Segment profit (loss)

	Yen in millions
	Three months ended December 31
	2021			2022			Change
Operating income (loss):
Game & Network Services		92,896			116,248			23,352
Music		55,113			62,961			7,848
Pictures		149,372			25,445			(123,927	)
Entertainment, Technology & Services		80,036			81,094			1,058
Imaging & Sensing Solutions		64,650			84,851			20,201
Financial Services		35,208			54,263			19,055
All Other		8,178			9,062			884
Total		485,453			433,924			(51,529	)
Corporate and elimination		(20,270	)		(5,187	)		15,083
Consolidated operating income		465,183			428,737			(36,446	)

　　Operating income (loss) is sales and financial services revenue less costs and expenses, and includes the share of profit (loss) of investments accounted for using the equity method.

　　The former Electronics Products & Solutions (“EP&S”) segment has been renamed the ET&S segment effective from April 2022. This change has not resulted in any reclassification of businesses across segments.

F-11

(Business Segments)

Segment sales and financial services revenue

	Yen in millions
	Nine months ended December 31
	2021			2022			Change
Sales and financial services revenue:
Game & Network Services -
Customers		2,027,428			2,502,796			475,368
Intersegment		47,085			68,604			21,519
Total		2,074,513			2,571,400			496,887
Music -
Customers		813,136			1,022,924			209,788
Intersegment		9,220			8,212			(1,008	)
Total		822,356			1,031,136			208,780
Pictures -
Customers		925,246			1,007,752			82,506
Intersegment		1,430			2,630			1,200
Total		926,676			1,010,382			83,706
Entertainment, Technology & Services -
Customers		1,814,019			1,953,118			139,099
Intersegment		31,114			29,060			(2,054	)
Total		1,845,133			1,982,178			137,045
Imaging & Sensing Solutions -
Customers		757,929			975,203			217,274
Intersegment		63,204			78,156			14,952
Total		821,133			1,053,359			232,226
Financial Services -
Customers		1,247,384			953,024			(294,360	)
Intersegment		6,762			8,242			1,480
Total		1,254,146			961,266			(292,880	)
All Other -
Customers		62,678			52,848			(9,830	)
Intersegment		11,197			12,278			1,081
Total		73,875			65,126			(8,749	)
Corporate and elimination		(160,305	)		(198,560	)		(38,255	)
Consolidated total		7,657,527			8,476,287			818,760

　　G&NS intersegment amounts primarily consist of transactions with the ET&S segment. ET&S intersegment amounts primarily consist of transactions with the G&NS segment. I&SS intersegment amounts primarily consist of transactions with the G&NS segment and the ET&S segment. Corporate and elimination includes certain brand and patent royalty income.

F-12

Segment profit (loss)

	Yen in millions
	Nine months ended December 31
	2021			2022			Change
Operating income (loss):
Game & Network Services		258,834			211,142			(47,692	)
Music		161,079			202,667			41,588
Pictures		206,355			103,720			(102,635	)
Entertainment, Technology & Services		224,498			212,502			(11,996	)
Imaging & Sensing Solutions		144,854			180,527			35,673
Financial Services		102,274			190,197			87,923
All Other		20,950			16,775			(4,175	)
Total		1,118,844			1,117,530			(1,314	)
Corporate and elimination		(55,134	)		(37,788	)		17,346
Consolidated operating income		1,063,710			1,079,742			16,032

　　Operating income (loss) is sales and financial services revenue less costs and expenses, and includes the share of profit (loss) of investments accounted for using the equity method.

　　The former EP&S segment has been renamed the ET&S segment effective from April 2022. This change has not resulted in any reclassification of businesses across segments.

F-13

(Sales to Customers by Product Category)

　　The following table is a breakdown of sales and financial services revenue to external customers by product category for each segment. Sony management views each segment as a single operating segment.

	Yen in millions
	Three months ended December 31
Sales and financial services revenue:	2021		2022		Change
Game & Network Services
Digital Software and Add-on Content		432,284		508,102		75,818
Network Services		102,501		122,201		19,700
Hardware and Others		261,949		581,314		319,365
Total		796,734		1,211,617		414,883
Music
Recorded Music - Streaming		119,506		159,147		39,641
Recorded Music - Others		64,281		79,901		15,620
Music Publishing		51,902		74,161		22,259
Visual Media and Platform		56,682		47,434		(9,248	)
Total		292,371		360,643		68,272
Pictures
Motion Pictures		191,887		113,087		(78,800	)
Television Productions		185,599		123,508		(62,091	)
Media Networks		82,828		94,330		11,502
Total		460,314		330,925		(129,389	)
Entertainment, Technology & Services
Televisions		269,530		250,192		(19,338	)
Audio and Video		105,330		122,605		17,275
Still and Video Cameras		117,851		171,146		53,295
Mobile Communications		102,339		93,302		(9,037	)
Other		84,545		105,235		20,690
Total		679,595		742,480		62,885
Imaging & Sensing Solutions		305,885		386,400		80,515
Financial Services		469,092		356,731		(112,361	)
All Other		23,387		19,648		(3,739	)
Corporate		3,941		4,470		529
Consolidated total		3,031,319		3,412,914		381,595

F-14

	Yen in millions
	Nine months ended December 31
Sales and financial services revenue:	2021		2022		Change
Game & Network Services
Digital Software and Add-on Content		1,067,578		1,126,806		59,228
Network Services		304,932		345,730		40,798
Hardware and Others		654,918		1,030,260		375,342
Total		2,027,428		2,502,796		475,368
Music
Recorded Music - Streaming		341,911		450,188		108,277
Recorded Music - Others		150,065		212,387		62,322
Music Publishing		146,344		210,707		64,363
Visual Media and Platform		174,816		149,642		(25,174	)
Total		813,136		1,022,924		209,788
Pictures
Motion Pictures		368,479		360,003		(8,476	)
Television Productions		333,885		377,255		43,370
Media Networks		222,882		270,494		47,612
Total		925,246		1,007,752		82,506
Entertainment, Technology & Services
Televisions		697,730		618,736		(78,994	)
Audio and Video		253,686		313,552		59,866
Still and Video Cameras		339,233		458,711		119,478
Mobile Communications		282,854		285,559		2,705
Other		240,516		276,560		36,044
Total		1,814,019		1,953,118		139,099
Imaging & Sensing Solutions		757,929		975,203		217,274
Financial Services		1,247,384		953,024		(294,360	)
All Other		62,678		52,848		(9,830	)
Corporate		9,707		8,622		(1,085	)
Consolidated total		7,657,527		8,476,287		818,760

　　In the G&NS segment, Digital Software and Add-on Content includes distribution of software titles and add-on content through the network by Sony Interactive Entertainment; Network Services includes network services relating to game, video and music content; Hardware and Others includes home gaming consoles, packaged software, game software sold bundled with home gaming consoles, peripheral devices and first-party software for third-party platforms. In the Music segment, Recorded Music - Streaming includes the distribution of digital recorded music by streaming; Recorded Music - Others includes the distribution of recorded music by physical media and digital download as well as revenue derived from artists’ live performances; Music Publishing includes the management and licensing of the words and music of songs; Visual Media and Platform includes the production and distribution of animation titles and game applications, and various service offerings for music and visual products. In the Pictures segment, Motion Pictures includes the worldwide production, acquisition and distribution of live-action and animated motion pictures; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks worldwide. In the ET&S segment, Televisions includes LCD and OLED televisions; Audio and Video includes Blu-ray disc players and recorders, home audio, headphones and memory-based portable audio devices; Still and Video Cameras includes interchangeable lens cameras, compact digital cameras, consumer video cameras and video cameras for broadcast; Mobile Communications includes smartphones and an internet-related service business; Other includes display products such as projectors and medical equipment.

F-15

(Condensed Financial Services Financial Statements)

　　The following schedules show unaudited condensed financial statements for the Financial Services segment and all other segments excluding Financial Services. These presentations are not in accordance with IFRS, which is used by Sony to prepare its condensed consolidated financial statements. However, because the Financial Services segment is different in nature from Sony’s other segments, Sony believes that a comparative presentation may be useful in understanding and analyzing Sony’s condensed consolidated financial statements. Both financial statements include transactions between the Financial Services segment and Sony without the Financial Services segment. The figures shown in the respective presentations for the Financial Services segment and Sony without the Financial Services segment are prior to the elimination and/or offset of such transactions and deferred tax assets and deferred tax liabilities of each. The condensed consolidated financial statements column is presented net of the elimination and/or offset of such intercompany balances and deferred tax assets and liabilities.

Condensed Statements of Financial Position

	Yen in millions
	Financial Services				Sony without Financial Services				Consolidated
	March 31, 2022		December 31, 2022		March 31, 2022		December 31, 2022		March 31, 2022		December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents	¥	889,140	¥	592,889	¥	1,160,496	¥	695,091	¥	2,049,636	¥	1,287,980
Investments and advances in the Financial Services segment		360,673		323,390		–		–		360,673		323,390
Trade and other receivables, and contract assets		169,929		160,983		1,478,620		1,843,856		1,628,521		1,978,985
Inventories		–		–		874,007		1,464,515		874,007		1,464,515
Other financial assets		81,174		70,001		68,124		74,623		149,301		144,626
Other current assets		72,441		58,036		450,953		521,371		473,070		566,819
Total current assets		1,573,357		1,205,299		4,032,200		4,599,456		5,535,208		5,766,315
Non-current assets:
Investments accounted for using the equity method		–		–		268,513		317,405		268,513		317,405
Investments and advances in the Financial Services segment		18,445,088		17,504,209		–		–		18,445,088		17,504,209
Investments in Financial Services, at cost		–		–		550,483		550,483		–		–
Property, plant and equipment		18,010		15,378		1,095,241		1,264,666		1,113,213		1,280,372
Right-of-use assets		73,774		82,488		339,658		347,287		413,430		429,392
Goodwill and intangible assets, including content assets		72,578		75,550		2,672,466		3,312,982		2,745,044		3,388,532
Deferred insurance acquisition costs		676,526		690,374		–		–		676,526		690,374
Deferred tax assets		–		–		332,330		380,540		298,589		338,882
Other financial assets		37,037		53,818		663,233		799,294		696,306		849,047
Other non-current assets		77,657		76,522		284,834		303,727		289,050		307,962
Total non-current assets		19,400,670		18,498,339		6,206,758		7,276,384		24,945,759		25,106,175
Total assets	¥	20,974,027	¥	19,703,638	¥	10,238,958	¥	11,875,840	¥	30,480,967	¥	30,872,490

LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings	¥	1,964,776	¥	2,085,721	¥	183,187	¥	200,317	¥	2,147,962	¥	2,286,038
Trade and other payables		118,921		71,090		1,744,011		1,978,554		1,843,242		2,024,291
Deposits from customers in the banking business		2,886,361		3,071,144		–		–		2,886,361		3,071,144
Income taxes payables		4,444		16,019		101,648		160,711		106,092		176,730
Participation and residual liabilities in the Pictures segment		–		–		190,162		215,503		190,162		215,503
Other financial liabilities		68,793		50,519		29,050		31,978		97,843		82,497
Other current liabilities		242,937		215,157		1,296,205		1,438,511		1,488,488		1,640,632
Total current liabilities		5,286,232		5,509,650		3,544,263		4,025,574		8,760,150		9,496,835
Non-current liabilities:
Long-term debt		470,498		457,322		733,148		1,057,033		1,203,646		1,514,355
Defined benefit liabilities		37,167		38,161		217,381		211,276		254,548		249,437
Deferred tax liabilities		634,576		115,474		110,715		111,622		696,492		170,680
Future insurance policy benefits and other		7,039,034		7,191,165		–		–		7,039,034		7,191,165
Policyholders’ account in the life insurance business		4,791,295		4,907,618		–		–		4,791,295		4,907,618
Participation and residual liabilities in the Pictures segment		–		–		220,113		205,579		220,113		205,579
Other financial liabilities		128,208		144,319		86,391		198,088		211,959		339,652
Other non-current liabilities		5,864		6,735		121,558		137,464		106,481		123,394
Total non-current liabilities		13,106,642		12,860,794		1,489,306		1,921,062		14,523,568		14,701,880
Total liabilities		18,392,874		18,370,444		5,033,569		5,946,636		23,283,718		24,198,715
Equity:
Stockholders’ equity of Financial Services		2,577,705		1,329,512		–		–		–		–
Stockholders’ equity of Sony without Financial Services		–		–		5,156,059		5,875,829		–		–
Sony Group Corporation’s stockholders’ equity		–		–		–		–		7,144,471		6,616,718
Noncontrolling interests		3,448		3,682		49,330		53,375		52,778		57,057
Total equity		2,581,153		1,333,194		5,205,389		5,929,204		7,197,249		6,673,775
Total liabilities and equity	¥	20,974,027	¥	19,703,638	¥	10,238,958	¥	11,875,840	¥	30,480,967	¥	30,872,490

F-16

Condensed Statements of Income

	Yen in millions
	Three months ended December 31
	Financial Services				Sony without Financial Services						Consolidated
	2021		2022		2021			2022			2021			2022

Sales	¥	–	¥	–	¥	2,563,499		¥	3,057,441		¥	2,562,227		¥	3,056,183
Financial services revenue		471,346		359,032		–			–			469,092			356,731
Total sales and financial services revenue		471,346		359,032		2,563,499			3,057,441			3,031,319			3,412,914

Cost of sales		–		–		1,790,131			2,164,926			1,787,301			2,161,904
Selling, general and administrative		–		–		421,950			527,428			423,509			529,188
Financial services expenses		436,016		304,225		–			–			433,761			301,924
Other operating (income) expense, net		122		544		(71,082	)		(2,027	)		(70,960	)		(1,484	)
Total costs and expenses		436,138		304,769		2,140,999			2,690,327			2,573,611			2,991,532

Share of profit (loss) of investments accounted for using the equity method		–		–		7,475			7,355			7,475			7,355

Operating income		35,208		54,263		429,975			374,469			465,183			428,737

Financial income (expenses), net		–		–		(3,616	)		(30,159	)		(3,614	)		(30,158	)

Income before income taxes		35,208		54,263		426,359			344,310			461,569			398,579

Income taxes		10,095		15,589		103,547			54,485			113,645			70,073

Net income		25,113		38,674		322,812			289,825			347,924			328,506

Net income of Financial Services	¥	24,980	¥	38,661	¥	–		¥	–		¥	–		¥	–

Net income of Sony without Financial Services	¥	–	¥	–	¥	321,182		¥	288,141		¥	–		¥	–

Net income attributable to Sony Group Corporation’s stockholders	¥	–	¥	–	¥	–		¥	–		¥	346,161		¥	326,809

Net income attributable to noncontrolling interests	¥	133	¥	13	¥	1,630		¥	1,684		¥	1,763		¥	1,697

F-17

Condensed Statements of Income

	Yen in millions
	Nine months ended December 31
	Financial Services					Sony without Financial Services						Consolidated
	2021		2022			2021			2022			2021			2022

Sales	¥	–	¥	–		¥	6,413,935		¥	7,527,631		¥	6,410,143		¥	7,523,263
Financial services revenue		1,254,146		961,266			–			–			1,247,384			953,024
Total sales and financial services revenue		1,254,146		961,266			6,413,935			7,527,631			7,657,527			8,476,287

Cost of sales		–		–			4,409,132			5,250,787			4,401,169			5,241,857
Selling, general and administrative		–		–			1,134,547			1,412,507			1,138,719			1,418,411
Financial services expenses		1,151,603		775,359			–			–			1,144,840			767,117
Other operating (income) expense, net		269		(4,290	)		(71,116	)		(5,681	)		(70,847	)		(12,278	)
Total costs and expenses		1,151,872		771,069			5,472,563			6,657,613			6,613,881			7,415,107

Share of profit (loss) of investments accounted for using the equity method		–		–			20,064			18,562			20,064			18,562

Operating income		102,274		190,197			961,436			888,580			1,063,710			1,079,742

Financial income (expenses), net		–		–			3,324			(2,699	)		(35,832	)		(44,031	)

Income before income taxes		102,274		190,197			964,760			885,881			1,027,878			1,035,711

Income taxes		26,002		52,643			226,437			168,287			252,443			221,228

Net income		76,272		137,554			738,323			717,594			775,435			814,483

Net income of Financial Services	¥	75,881	¥	137,320		¥	–		¥	–		¥	–		¥	–

Net income of Sony without Financial Services	¥	–	¥	–		¥	734,375		¥	712,313		¥	–		¥	–

Net income attributable to Sony Group Corporation’s stockholders	¥	–	¥	-		¥	–		¥	–		¥	771,096		¥	808,968

Net income attributable to noncontrolling interests	¥	391	¥	234		¥	3,948		¥	5,281		¥	4,339		¥	5,515

F-18

Condensed Statements of Cash Flows

	Yen in millions
	Nine months ended December 31
	Financial Services						Sony without Financial Services						Consolidated
	2021			2022			2021			2022			2021			2022
Cash flows from operating activities:
Income (loss) before income taxes	¥	102,274		¥	190,197		¥	964,760		¥	885,881		¥	1,027,878		¥	1,035,711
Adjustments to reconcile income (loss) before income taxes to net cash provided by (used in) operating activities:
Depreciation and amortization, including amortization of contract costs		18,682			19,583			601,433			716,059			620,115			735,642
Amortization of deferred insurance acquisition costs		46,605			82,169			–			–			46,605			82,169
Other operating (income) expense, net		269			(4,290	)		(71,116	)		(5,681	)		(70,847	)		(12,278	)
(Gain) loss on securities, net (other than Financial Services segment)		–			–			23,606			27,154			23,606			27,154
Change in future insurance policy benefits and other		300,632			156,149			–			–			300,632			156,149
Change in policyholders’ account in the life insurance business, less cash impact		291,078			(148,264	)		–			–			291,078			(148,264	)
Net cash impact of policyholders’ account in the life insurance business		153,714			263,986			–			–			153,714			263,986
Changes in assets and liabilities:
(Increase) decrease in trade receivables and contract assets		(35,697	)		8,946			(398,020	)		(298,206	)		(428,153	)		(283,431	)
(Increase) decrease in inventories		–			–			(134,997	)		(572,541	)		(134,997	)		(572,541	)
(Increase) decrease in investments and advances in the Financial Services segment		(1,145,193	)		(908,293	)		–			–			(1,145,193	)		(908,293	)
(Increase) decrease in content assets		–			–			(407,502	)		(485,450	)		(407,502	)		(485,450	)
(Increase) decrease in deferred insurance acquisition costs		(83,383	)		(88,976	)		–			–			(83,383	)		(88,976	)
Increase (decrease) in trade payables		(19,833	)		(43,819	)		166,378			111,860			140,852			62,428
Increase (decrease) in deposits from customers in the banking business		164,387			194,976			–			–			164,387			194,976
Increase (decrease) in borrowings in the life insurance business and the banking business		478,305			100,670			–			–			478,305			100,670
Increase (decrease) in taxes payable other than income taxes, net		900			830			(14,737	)		(35,742	)		(13,837	)		(34,912	)
Other		9,426			(51,037	)		(164,043	)		(153,671	)		(154,659	)		(206,363	)
Net cash provided by (used in) operating activities		282,166			(227,173	)		565,762			189,663			808,601			(81,623	)

Cash flows from investing activities:
Payments for property, plant and equipment and other intangible assets		(15,720	)		(19,642	)		(322,833	)		(415,597	)		(338,553	)		(434,748	)
Payments for investments and advances (other than Financial Services segment)		–			–			(63,201	)		(185,577	)		(63,201	)		(185,577	)
Proceeds from sales or return of investments and collections of advances (other than Financial Services segment)		–			–			23,033			11,740			23,033			11,740
Other		2,914			416			(147,417	)		(251,640	)		(144,503	)		(248,938	)
Net cash provided by (used in) investing activities		(12,806	)		(19,226	)		(510,418	)		(841,074	)		(523,224	)		(857,523	)

Cash flows from financing activities:
Increase (decrease) in borrowings, net		(8,138	)		(8,514	)		(133,832	)		278,516			(141,970	)		270,002
Dividends paid		(39,159	)		(41,335	)		(74,208	)		(86,384	)		(74,208	)		(86,383	)
Other		(5	)		(3	)		(62,680	)		(84,268	)		(62,517	)		(84,271	)
Net cash provided by (used in) financing activities		(47,302	)		(49,852	)		(270,720	)		107,864			(278,695	)		99,348

Effect of exchange rate changes on cash and cash equivalents		–			–			28,914			78,142			28,914			78,142

Net increase (decrease) in cash and cash equivalents		222,058			(296,251	)		(186,462	)		(465,405	)		35,596			(761,656	)
Cash and cash equivalents at beginning of the fiscal year		497,218			889,140			1,289,764			1,160,496			1,786,982			2,049,636
Cash and cash equivalents at end of the period	¥	719,276		¥	592,889		¥	1,103,302		¥	695,091		¥	1,822,578		¥	1,287,980

F-19

Going Concern Assumption

　　Not Applicable

Accounting Policy and Other Information

(Net Income Attributable to Sony Group Corporation’s Stockholders and Weighted-average Number of Outstanding Shares Used for the Computation of EPS of Common Stock)

	Yen in millions
	Three months ended December 31
	2021		2022
Net income attributable to Sony Group Corporation’s stockholders		346,161		326,809
Adjustment amount to net income attributable to Sony Group Corporation’s stockholders for diluted EPS computation:
Zero coupon convertible bonds		36		–
Net income attributable to Sony Group Corporation’s stockholders for diluted EPS computation		346,197		326,809

	Thousands of shares
	Three months ended December 31
		2021	2022
Weighted-average shares outstanding for basic EPS computation		1,239,709	1,235,285
Effect of dilutive securities:
Stock acquisition rights and other		5,954	3,128
Zero coupon convertible bonds		5,733	–
Weighted-average shares for diluted EPS computation		1,251,396	1,238,413

	Yen in millions
	Nine months ended December 31
	2021		2022
Net income attributable to Sony Group Corporation’s stockholders		771,096		808,968
Adjustment amount to net income attributable to Sony Group Corporation’s stockholders for diluted EPS computation:
Zero coupon convertible bonds		129		51
Net income attributable to Sony Group Corporation’s stockholders for diluted EPS computation		771,225		809,019

	Thousands of shares
	Nine months ended December 31
		2021	2022
Weighted-average shares outstanding for basic EPS computation		1,239,640	1,236,176
Effect of dilutive securities:
Stock acquisition rights and other		5,504	3,632
Zero coupon convertible bonds		6,843	2,706
Weighted-average shares for diluted EPS computation		1,251,987	1,242,514

F-20

(Segmentation)

　　The former EP&S segment has been renamed the ET&S segment effective from April 2022. This change has not resulted in any reclassification of businesses across segments.

　　The G&NS segment includes the network services businesses, the manufacture and sales of home gaming products and the production and sales of software. The Music segment includes the Recorded Music, Music Publishing and Visual Media and Platform businesses. The Pictures segment includes the Motion Pictures, Television Productions and Media Networks businesses. The ET&S segment includes the Televisions business, the Audio and Video business, the Still and Video Cameras business, the smartphone business and the internet-related service business. The I&SS segment includes the image sensors business. The Financial Services segment primarily represents individual life insurance and non-life insurance businesses in the Japanese market and the banking business in Japan. All Other consists of various operating activities, including the disc manufacturing and recording media businesses. Sony’s products and services are generally unique to a single operating segment.

F-21

(Acquisition of Bungie, Inc.)

　　On July 15, 2022, Sony Interactive Entertainment LLC (“SIE”), a wholly-owned subsidiary of Sony, completed the acquisition of 100% of the shares of Bungie, Inc. (“Bungie”), an independent videogame developer in the United States. As a result of this acquisition, Bungie has become a wholly-owned subsidiary of Sony. This acquisition gives SIE access to Bungie’s approach to live game services and technology expertise.

　　The total consideration of this acquisition, which was determined after customary working capital and other adjustments, was 510,860 million yen (3,704 million U.S. dollars), inclusive of the purchase price and committed employee incentives. Of the total consideration, 348,169 million yen (2,525 million U.S. dollars) was allocated to the purchase consideration of this acquisition, and the remaining 162,691 million yen (1,179 million U.S. dollars) was mainly allocated to deferred payments to employee shareholders that are conditional upon their continuous employment, and other retention incentives. The deferred payments and other retention incentives will be expensed over the required post-acquisition service periods.

　　The fair value of the purchase consideration of this acquisition as of the acquisition date was 334,261 million yen (2,424 million U.S. dollars) which consisted of upfront cash consideration of 207,912 million yen (1,508 million U.S. dollars), deferred consideration of 84,410 million yen (612 million U.S. dollars), and contingent consideration of 41,938 million yen (304 million U.S. dollars) that is subject to employee shareholders’ continuous employment and represents the vested portion of the total vesting term of replacement awards that existed as of the acquisition date. Deferred consideration and contingent consideration are included in other financial liabilities (current and non-current) in the condensed consolidated statements of financial position.

　　Sony’s condensed consolidated statements of income for the nine and three months ended December 31, 2022 include net loss after income taxes of 31,330 million yen (220 million U.S. dollars) and 17,462 million yen (123 million U.S. dollars), respectively, attributable to Bungie since the acquisition date, including the deferred payments and other retention incentives arising out of this acquisition and amortization of intangible assets recognized as of the acquisition date. Revenue after elimination of intercompany transactions attributable to Bungie since the acquisition date for the nine and three months ended December 31, 2022 has not been presented because the revenue was not material.

　　Sony consolidated Bungie by using the acquisition method of accounting and recorded the fair value of the identifiable assets acquired, liabilities assumed and residual goodwill of Bungie. The following table summarizes the fair values assigned to the assets and liabilities of Bungie that were recorded in the G&NS segment. The purchase price allocation as of the acquisition date is preliminary as of December 31, 2022 and is subject to change. The primary areas of the purchase price allocation that are not yet finalized are related to goodwill, content assets, other intangible assets and deferred tax assets.

	Yen in millions
Cash and cash equivalents		37,800
Trade and other receivables, and contract assets		5,093
Other current assets		3,412
Property, plant and equipment		7,481
Right-of-use assets		15,540
Goodwill		196,473
Content assets		45,512
Other intangible assets		66,257
Deferred tax assets		4,788
Other		3,564
Total assets		385,920
Trade and other payables		3,060
Other current liabilities		12,195
Long-term debt		30,944
Other		5,460
Long-term debt		30,944
Other		5,460
Total liabilities		51,659

　　Content assets and other intangible assets mainly consist of license agreements and software. Goodwill mainly represents future growth from new revenue streams and synergies with existing Sony businesses and is not deductible for tax purposes. Goodwill recorded in connection with the acquisition is included in the G&NS segment.

　　Pro forma results of operations have not been presented because the effect of the acquisition is not material.

F-22

(Change in presentation)

Condensed Consolidated Statements of Cash Flows

　　Certain reclassifications of the condensed consolidated statements of cash flows for the nine months ended December 31, 2021 have been made to conform to the presentation for the nine months ended December 31, 2022.

F-23

Outlook for the Fiscal Year Ending March 31, 2023

The forecast for consolidated results for the fiscal year ending March 31, 2023, as announced on November 1, 2022, has been revised as follows:

	(Billions of yen)
	March 31, 2022 Results	November Forecast	February Forecast	Change from November Forecast
Sales *¹	¥9,921.5	¥11,600	¥11,500	- ¥100 bil		- 0.9	%
Operating income	1,202.3	1,160	1,180	+ 20 bil		+ 1.7	%
Income before income taxes	1,117.5	1,120	1,120		-		-
Net income attributable to Sony Group Corporation’s stockholders	882.2	840	870	+ 30 bil		+ 3.6	%

For all segments excluding the Financial Services segment *²	March 31, 2022 Results	November Forecast	February Forecast	Change from November Forecast
Net cash provided by operating activities	¥813.3	¥820	¥550	- 270 bil		- 32.9	%

*¹ “Sales and Financial Services revenue” are shown as “Sales” (the same applies below).

*² Cash flow for all segments excluding the Financial Services segment is not a measure in accordance with IFRS. However, Sony believes that this disclosure may be useful information to investors. Please refer to page F-16 for details about the preparation of the Condensed Statements of Cash Flows.

Assumed foreign exchange rates are the following:

	Assumed foreign currency exchange rates for the three months ending March 31, 2023	(For your reference) Assumed foreign currency exchange rates for the fiscal year ending March 31, 2023 at the time of the November forecast
1 U.S. dollar	approximately 134 yen	approximately 140 yen
1 Euro	approximately 139 yen	approximately 138 yen

Sales are expected to be lower than the November forecast due to lower-than-expected sales in the Pictures, Entertainment, Technology & Services* and Imaging & Sensing Solutions segments.

Operating income is expected to be higher than the November forecast due to an expected increase in operating income in the Game & Network Services segment, as well as an expected decrease in the operating loss in All Other, Corporate and elimination.

Income before income taxes is expected to remain unchanged from the November forecast due to an expected increase in financial expenses, net, primarily resulting from an increase in net foreign exchange losses, substantially offset by the above-mentioned expected increase in operating income.

Net income attributable to Sony Group Corporation’s stockholders is expected to be higher than the November forecast due to a decrease in income tax expense.

Net cash provided by operating activities for all segments excluding the Financial Services segment is expected to be lower than the November forecast, mainly due to an increase in working capital resulting from an increase in inventories of PlayStation®5 hardware, for which production increased during the third quarter of the current fiscal year.

* The former Electronics Products & Solutions segment has been renamed the Entertainment, Technology & Services (ET&S) segment effective from April 2022. This change has not resulted in any reclassification of businesses across segments.

- 1 -

The forecast for each business segment for the fiscal year ending March 31, 2023 has been revised as follows:

	(Billions of yen)
	March 31, 2022 Results			November Forecast			February Forecast
Game & Network Services (G&NS)
Sales	¥2,739.8				¥3,630			¥3,630
Operating income		346.1			225			240
Music
Sales		1,116.9			1,370			1,370
Operating income		210.9			265			265
Pictures
Sales		1,238.9			1,450			1,400
Operating income		217.4			115			115
Entertainment, Technology & Services (ET&S)
Sales		2,339.2			2,510			2,480
Operating income		212.9			180			180
Imaging & Sensing Solutions (I&SS)
Sales		1,076.4			1,440			1,420
Operating income		155.6			220			220
Financial Services
Financial services revenue		1,533.8			1,310			1,310
Operating income		150.1			220			220
All Other, Corporate and elimination
Operating loss		(90.7	)		(65	)		(60	)
Consolidated
Sales		9,921.5			11,600			11,500
Operating income		1,202.3			1,160			1,180

Game & Network Services (G&NS)

Sales are expected to remain unchanged from the November forecast. Operating income is expected to be higher than the November forecast mainly due to the positive impact of foreign exchange rates.

In the February forecast, Sony has incorporated approximately 57 billion yen in expenses associated with acquisitions completed within the current fiscal year, including Bungie, Inc. The actual amount of expenses is subject to change depending on factors such as completion timing and the accounting treatment to be finalized after the closing dates.

Music

Sales and operating income are expected to remain unchanged from the November forecast.

- 2 -

Pictures

Sales are expected to be lower than the November forecast primarily due to lower-than-expected revenues in Motion Pictures resulting from release date changes for some theatrical releases and in Television Productions resulting from delays in deliveries of television episodes, as well as the impact of foreign exchange rates. Operating income is expected to remain unchanged from the November forecast due to lower marketing costs resulting from the release date changes for some theatrical releases in Motion Pictures, substantially offset by the impact of the above-mentioned expected decrease in sales.

Entertainment, Technology & Services (ET&S)

Sales are expected to be lower than the November forecast due to an expected decrease in sales of televisions resulting from an expected decrease in unit sales. Operating income is expected to remain unchanged from the November forecast due to the impact of the above-mentioned expected decrease in sales, substantially offset by a decrease in operating expenses.

Imaging & Sensing Solutions (I&SS)

Sales are expected to be lower than the November forecast primarily due to lower-than-expected sales of image sensors for mobile products resulting from a decrease in unit sales, partially offset by an improvement in the product mix. Operating income is expected to remain unchanged from the November forecast primarily due to the impact of the above-mentioned decrease in sales, substantially offset by a decrease in manufacturing costs.

Financial Services

Financial services revenue and operating income are expected to remain unchanged from the November forecast.

The effects of future gains and losses on investments held by the Financial Services segment due to market fluctuations have not been incorporated within the above forecast as it is difficult for Sony to predict market trends in the future. Accordingly, future market fluctuations could further impact the above forecast.

The above forecast is based on management’s current expectations and is subject to uncertainties and changes in circumstances. Actual results may differ materially from those included in this forecast due to a variety of factors. See “Cautionary Statement” below.

Notes about Financial Performance of the Music, Pictures and Financial Services segments

The Music segment results include the yen-based results of Sony Music Entertainment (Japan) Inc. and the yen-translated results of Sony Music Entertainment and Sony Music Publishing LLC, which aggregate the results of their worldwide subsidiaries on a U.S. dollar basis.

The Pictures segment results are the yen-translated results of Sony Pictures Entertainment Inc., which aggregates the results of its worldwide subsidiaries on a U.S. dollar basis.

The Financial Services segment results include Sony Financial Group Inc. (“SFGI”) and SFGI’s consolidated subsidiaries such as Sony Life, Sony Assurance Inc. and Sony Bank Inc. The results discussed in the Financial Services segment differ from the results that SFGI and SFGI’s consolidated subsidiaries disclose separately on a Japanese statutory basis.

- 3 -

Cautionary Statement

Statements made in this release with respect to Sony’s current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future performance of Sony. Forward-looking statements include, but are not limited to, those statements using words such as “believe,” “expect,” “plans,” “strategy,” “prospects,” “forecast,” “estimate,” “project,” “anticipate,” “aim,” “intend,” “seek,” “may,” “might,” “could” or “should,” and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in other materials released to the public. These statements are based on management’s 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 differ materially from those discussed in the forward-looking statements, and therefore investors should not place undue 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 disclaims any such obligation. Risks and uncertainties that might affect Sony include, but are not limited to:

(i)	Sony’s ability to maintain product quality and customer satisfaction with its products and services;
(ii)	Sony’s ability to continue to design and develop and win acceptance of, as well as achieve sufficient cost 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 severe price competition and continual new product and service introductions, rapid development in technology and subjective and changing customer preferences;
(iii)	Sony’s ability to implement successful hardware, software, and content integration strategies, and to develop and implement successful sales and distribution strategies in light of new technologies and distribution platforms;
(iv)	the effectiveness of Sony’s strategies and their execution, including but not limited to the success of Sony’s acquisitions, joint ventures, investments, capital expenditures, restructurings and other strategic initiatives;
(v)	changes in laws, regulations and government policies in the markets in which Sony and its third-party suppliers, service providers and business partners operate, including those related to taxation, as well as growing consumer focus on corporate social responsibility;
(vi)	Sony’s continued ability to identify the products, services and market trends with significant growth potential, to devote sufficient resources to research and development, to prioritize investments and capital expenditures correctly and to recoup its investments and capital expenditures, including those required for technology development and product capacity;
(vii)	Sony’s reliance on external business partners, including for the procurement of parts, components, software and network services for its products or services, the manufacturing, marketing and distribution of its products, and its other business operations;
(viii)	the global economic and political environment in which Sony operates and the economic and political conditions in Sony’s markets, particularly levels of consumer spending;
(ix)	Sony’s ability to meet operational and liquidity needs as a result of significant volatility and disruption in the global financial markets or a ratings downgrade;
(x)	Sony’s ability to forecast demands, manage timely procurement and control inventories;
(xi)	foreign exchange rates, particularly between the yen and the U.S. dollar, the euro and other currencies in which Sony makes significant sales and incurs production costs, or in which Sony’s assets, liabilities and operating results are denominated;
(xii)	Sony’s ability to recruit, retain and maintain productive relations with highly skilled personnel;
(xiii)	Sony’s ability to prevent unauthorized use or theft of intellectual property rights, to obtain or renew licenses relating to intellectual property rights and to defend itself against claims that its products or services infringe the intellectual property rights owned by others;
(xiv)	the impact of changes in interest rates and unfavorable conditions or developments (including market fluctuations or volatility) in the Japanese equity markets on the revenue and operating income of the Financial Services segment;
(xv)	shifts in customer demand for financial services such as life insurance and Sony’s ability to conduct successful 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 business partners to anticipate and manage cybersecurity risk, including the risk of unauthorized access to Sony’s business information and the personally identifiable information of its employees and customers, potential business disruptions or financial losses; and
(xviii)	the outcome of pending and/or future legal and/or regulatory proceedings.

Risks and uncertainties also include the impact of any future events with material adverse impact. The continued impact of COVID-19 and developments relating to the situation in Ukraine and Russia could heighten many of the risks and uncertainties noted above. Important information regarding risks and uncertainties is also set forth in Sony’s most recent Form 20-F, which is on file with the U.S. Securities and Exchange Commission.

- 4 -

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