{"url_path":"/sec/sony/10-k/2026/item-19","section_key":"item-19","section_title":"Item 19 Exhibits","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-18","source_url":"https://www.sec.gov/Archives/edgar/data/313838/0001193125-26-274893-index.html","accession_number":"0001193125-26-274893","cik":"0000313838","ticker":"SONY","issuer_name":"Sony Group Corp","edgar_url":"https://www.sec.gov/Archives/edgar/data/313838/0001193125-26-274893-index.html","primary_entity_key":"0000313838","primary_entity_name":"Sony Group Corp"},"word_count":55856,"has_tables":true,"body_markdown":"Item 19.\n\nExhibits\n\nDocuments filed as exhibits to this annual report:\n\n \n\n1.1\n\n  \n\n[Amended Articles of Incorporation of Sony Group Corporation (English Translation), incorporated by reference to Exhibit 1.1 to Sony’s annual report on Form 20-F for the fiscal year ended March 31, 2025 (Commission file number 001-06439) filed on June 20, 2025](http://www.sec.gov/Archives/edgar/data/313838/000119312525143137/d820387dex11.htm)\n\n1.2\n\n  \n\n[Share Handling Regulations (English Translation), incorporated by reference to Exhibit 1.2 to Sony’s annual report on Form 20-F for the fiscal year ended March 31, 2024 (Commission file number 001-06439) filed on June 25, 2024](http://www.sec.gov/Archives/edgar/data/313838/000119312524167500/d797371dex12.htm)\n\n1.3\n\n  \n\n[Charter of the Board of Directors, as amended (English Translation), incorporated by reference to Exhibit 1.3 of Sony’s annual report on Form 20-F for the fiscal year ended March 31, 2024 (Commission file number 001-06439) filed on June 25, 2024](http://www.sec.gov/Archives/edgar/data/313838/000119312524167500/d797371dex13.htm)\n\n2.1\n\n  \n\n[Second Further Amended and Restated Deposit Agreement, dated as of April 1, 2025, by and among Sony Group Corporation, JPMorgan Chase Bank, N.A. and holders and beneficial owners of American Depositary Shares issued thereunder, including the form of American Depositary Receipt, incorporated by reference to Exhibit 99. A to Sony’s registration statement on Form F-6 (Commission file number 333-285828) filed on March 14, 2025](http://www.sec.gov/Archives/edgar/data/313838/000119380525000308/e664280_ex99-a.htm)\n\n2.2\n\n  \n\n[Description of Rights of each Class of Securities Registered under Section 12 of the Securities Exchange Act of 1934](d28719dex22.htm)\n\n8.1\n\n  \n\nSignificant subsidiaries (as defined in §210.1-02(w) of Regulation S-X) of Sony Group Corporation, including additional subsidiaries that management has deemed to be significant, as of March 31, 2026: Incorporated by reference to “Business Overview” and “Organizational Structure” in “[Item 4. Information on the Company](#sig)”\n\n11.1\n\n  \n\n[Global Policy on Insider Trading Prevention](d28719dex111.htm)\n\n12.1\n\n  \n\n[302 Certification](d28719dex121.htm)\n\n12.2\n\n  \n\n[302 Certification](d28719dex122.htm)\n\n13.1\n\n  \n\n[906 Certification](d28719dex131.htm)\n\n15.1\n\n  \n\n[Consent of PricewaterhouseCoopers Japan LLC](d28719dex151.htm)\n\n97.1\n\n  \n\n[Sony Group Corporation Clawback Policy, incorporated by reference to Exhibit 97.1 to Sony’s annual report on Form 20-F for the fiscal year ended March 31, 2024 (Commission file number 001-06439) filed on June 25, 2024](http://www.sec.gov/Archives/edgar/data/313838/000119312524167500/d797371dex971.htm)\n\n101.INS\n\n  \n\nInline XBRL Instance Document — the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document\n\n101.SCH\n\n  \n\nInline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents\n\n104\n\n  \n\nCover page formatted as Inline XBRL and contained in Exhibit 101\n\n \n\n- 121 -\n\n##### Table of Contents\n\nSIGNATURES\n\nPursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.\n\n \n\nSONY GROUP CORPORATION\n\n(Registrant)\n\nBy:\n\n \n\n/s/ LIN TAO\n\n \n\n(Signature)\n\n \n\nLin Tao\n\n \n\nChief Financial Officer\n\nDate: June 18, 2026\n\n \n\n- 122 -\n\n##### Table of Contents\n\nINDEX TO CONSOLIDATED FINANCIAL STATEMENTS\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n  \n\nPage\n\n \n\n[Report of Independent Registered Public Accounting Firm (PCAOB ID 2743)](#fin28719_1)\n\n  \n \n\nF-2\n\n \n\n[Consolidated Statements of Financial Position](#fin28719_2)\n\n  \n \n\nF-4\n\n \n\n[Consolidated Statements of Income](#fin28719_3)\n\n  \n \n\nF-6\n\n \n\n[Consolidated Statements of Comprehensive Income](#fin28719_4)\n\n  \n \n\nF-7\n\n \n\n[Consolidated Statements of Changes in Stockholders’ Equity](#fin28719_5)\n\n  \n \nF-8\n \n\n[Consolidated Statements of Cash Flows](#fin28719_6)\n\n  \n \n\nF-10\n\n \n\n[Index to Notes to Consolidated Financial Statements](#fin28719_7)\n\n  \n \n\nF-12\n\n \n\n[Notes to Consolidated Financial Statements](#fin28719_8)\n\n  \n \n\nF-13\n\n \n\nAll other schedules are omitted because they are not applicable or the required information is shown in the financial statements or the notes thereto.\n\n \n\nF-1\n\n[Table of Contents](#toc)\n\nReport of Independent Registered Public Accounting Firm\n\nTo the Board of Directors and Stockholders of Sony Group Corporation (Sony Group Kabushiki Kaisha)\n\nOpinions on the Financial Statements and Internal Control over Financial Reporting\n\nWe have audited the accompanying consolidated statements of financial position of Sony Group Corporation and its subsidiaries (the “Company”) as of March 31, 2026 and 2025, and the related consolidated statements of income, comprehensive income, changes in stockholders’ equity and cash flows for each of the three years in the period ended March 31, 2026, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).\n\nIn our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2026 in conformity with IFRS Accounting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 31, 2026, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.\n\nBasis for Opinions\n\nThe Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 15(b). Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.\n\nOur audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.\n\nDefinition and Limitations of Internal Control over Financial Reporting\n\nA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.\n\nBecause of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.\n\n \n\nF-2\n\n[Table of Contents](#toc)\n\nCritical Audit Matters\n\nThe critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.\n\nSignificant assumptions used in the valuation of accumulated other comprehensive income related to insurance finance income (expenses) arising from groups of insurance contracts not measured under the premium allocation approach (“PAA”) that was transferred to net income (loss) from discontinued operations\n\nAs described in Notes 3, 13 and 33 to the consolidated financial statements, the Company executed a partial spin-off of the Financial Services business as of October 1, 2025. As a result of the execution of the spin-off, 1,377,795 million yen of accumulated other comprehensive income directly related to the disposal group classified as held for distribution to owners at the time of the execution was transferred to net income (loss) from discontinued operations as a loss in the consolidated statements of income. Of this accumulated other comprehensive income, loss of 1,640,079 million yen relates to changes in the fair value of debt instruments measured at fair value through other comprehensive income held in the Financial Services business, and income of 263,298 million yen relates to insurance finance income (expenses). The latter mainly comprises changes in the carrying amount of groups of insurance contracts not measured under the PAA that are arising from the impact of the changes in the time value of money and financial risks. The carrying amount of a group of insurance contracts is the sum of the liability for remaining coverage and the liability for incurred claims. For insurance contracts not measured under the PAA, the liability for remaining coverage comprises fulfillment cash flows and the contractual service margin, and the liability for incurred claims comprises fulfillment cash flows for incurred claims and expenses that have not yet been paid, including claims that have been incurred but not yet reported. The fulfillment cash flows are measured using current estimates of future cash flows, discount rates, and a risk adjustment for\nnon-financial\nrisk. The discount rates used to measure the estimates of the present value of future cash flows are derived by adjusting an observable risk-free yield curve based on government bond yields using an illiquidity premium by setting up a reference portfolio of Sony’s assets. Regarding extrapolation for the periods in which observable market data is not available, a method using an ultimate forward rate is applied. These discount rates represent significant assumptions used in measuring the portion of accumulated other comprehensive income related to insurance finance income (expenses).\n\nThe principal considerations for our determination that performing procedures relating to the significant assumptions used in the valuation of accumulated other comprehensive income related to insurance finance income (expenses) arising from groups of insurance contracts not measured under the PAA that was transferred to net income (loss) from discontinued operations is a critical audit matter are: (1) management’s significant judgment involved in developing the aforementioned significant assumptions; (2) which in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence related to management’s significant assumptions; and (3) the audit effort involved the use of professionals with specialized skill and knowledge.\n\nAddressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others, testing the effectiveness of controls relating to the determination of the discount rates as significant assumptions, including controls over the completeness and accuracy of data used by management in developing the discount rate assumptions. These procedures also included evaluating the completeness and accuracy of the data used by management to develop the discount rate assumptions. Professionals with specialized skill and knowledge were used to assist in evaluating (a) that the discount rate calculations were mathematically correct, (b) that government bond yields and ultimate forward rates were appropriately applied for periods without observable market data, (c) that the illiquidity premium was appropriately derived using a reference portfolio of assets, and (d) the reasonableness of the methodology used by management to determine the significant assumptions and the reasonableness of such assumptions based on industry knowledge.\n\n/s/\nPricewaterhouseCoopers Japan LLC\n\nTokyo, Japan\n\nJune \n1\n\n8\n, 202\n6\n\nWe have served as the Company’s auditor since 2006.\n\n \n\nF-3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Financial Position\n\n \n\n \n\n \n\n \n  \n \n \n  \n\nYen in millions\n\n \n\n  \n  \n\nNote\n\n \n  \n\nMarch 31,\n\n2025\n\n \n  \n\nMarch 31,\n\n2026\n\n \n\nASSETS\n\n  \n\n  \n\n  \n\nCurrent assets:\n\n  \n\n  \n\n  \n\nCash and cash equivalents\n\n  \n \n27\n \n  \n \n2,980,956\n \n  \n \n2,208,879\n \n\nInvestments and advances in the Financial Services segment (including assets pledged that secured parties are permitted to sell or repledge of 131,544 million yen as of March 31, 2025)\n\n  \n \n5,14\n \n  \n \n453,677\n \n  \n \n-\n \n\nTrade and other receivables, and contract assets\n\n  \n \n5,22\n \n  \n \n1,943,184\n \n  \n \n1,821,916\n \n\nInventories\n\n  \n \n7\n \n  \n \n1,310,770\n \n  \n \n1,227,351\n \n\nOther financial assets\n\n  \n \n5\n \n  \n \n145,192\n \n  \n \n28,167\n \n\nOther current assets\n\n  \n \n19\n \n  \n \n621,209\n \n  \n \n663,678\n \n\nTotal current assets\n\n  \n \n \n \n  \n \n7,454,988\n \n  \n \n5,949,991\n \n\nNon-current\nassets:\n\n  \n\n  \n\n  \n\nInvestments accounted for using the equity method\n\n  \n \n8\n \n  \n \n347,718\n \n  \n \n483,709\n \n\nInvestments and advances in the Financial Services segment (including assets pledged that secured parties are permitted to sell or repledge of 2,797,194 million yen as of March 31, 2025)\n\n  \n \n5,14\n \n  \n \n18,736,298\n \n  \n \n-\n \n\nProperty, plant and equipment\n\n  \n \n9\n \n  \n \n1,513,660\n \n  \n \n1,453,805\n \n\nRight-of-use\n\nassets\n\n  \n \n10\n \n  \n \n521,685\n \n  \n \n524,345\n \n\nGoodwill\n\n  \n \n11\n \n  \n \n1,508,721\n \n  \n \n1,673,906\n \n\nContent assets\n\n  \n \n11,27\n \n  \n \n2,249,048\n \n  \n \n2,558,615\n \n\nOther intangible assets\n\n  \n \n11\n \n  \n \n671,212\n \n  \n \n659,578\n \n\nDeferred tax assets\n\n  \n \n25\n \n  \n \n559,284\n \n  \n \n560,800\n \n\nOther financial assets\n\n  \n \n5\n \n  \n \n1,164,630\n \n  \n \n1,173,819\n \n\nOther\nnon-current\nassets\n\n  \n \n19\n \n  \n \n565,929\n \n  \n \n644,922\n \n\nTotal\nnon-current\nassets\n\n  \n \n \n \n  \n \n27,838,185\n \n  \n \n9,733,499\n \n\nTotal assets\n\n  \n \n \n \n  \n \n35,293,173\n \n  \n \n15,683,490\n \n\n(Continued on the following page.)\n\n \n\nF-4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Financial Position (Continued)\n\n \n\n \n\n \n\n \n\n \n  \n \n \n  \n\nYen in millions\n\n \n\n  \n  \n\nNote\n\n \n  \n\nMarch 31,\n\n2025\n\n \n \n\nMarch 31,\n\n2026\n\n \n\nLIABILITIES\n\n  \n\n  \n\n \n\nCurrent liabilities:\n\n  \n\n  \n\n \n\nShort-term borrowings\n\n  \n \n5,14\n \n  \n \n1,843,959\n \n \n \n51,183\n \n\nLease liabilities\n\n  \n \n2,\n5\n\n \n  \n \n90,495\n \n \n \n94,160\n \n\nCurrent portion of long-term debt\n\n  \n \n5,14\n \n  \n \n196,950\n \n \n \n166,410\n \n\nTrade and other payables\n\n  \n \n5\n \n  \n \n2,100,144\n \n \n \n2,240,566\n \n\nDeposits from customers in the banking business\n\n  \n \n5\n \n  \n \n3,981,193\n \n \n \n-\n \n\nIncome taxes payables\n\n  \n\n  \n \n89,485\n \n \n \n196,000\n \n\nParticipation and residual liabilities in the Pictures segment\n\n  \n \n18\n \n  \n \n236,752\n \n \n \n223,233\n \n\nContract liabilities\n\n  \n \n2,22\n \n  \n \n590,719\n \n \n \n594,336\n \n\nOther financial liabilities\n\n  \n \n5\n \n  \n \n110,689\n \n \n \n115,785\n \n\nOther current liabilities\n\n  \n \n13,19\n \n  \n \n1,448,402\n \n \n \n1,350,951\n \n\nTotal current liabilities\n\n  \n \n \n \n  \n \n10,688,788\n \n \n \n5,032,624\n \n\nNon-current\nliabilities:\n\n  \n\n  \n\n \n\nLong-term debt\n\n  \n \n5,14\n \n  \n \n1,557,867\n \n \n \n824,393\n \n\nLease liabilities\n\n  \n \n2,5\n \n  \n \n508,975\n \n \n \n533,523\n \n\nDefined benefit liabilities\n\n  \n \n17\n \n  \n \n236,941\n \n \n \n165,017\n \n\nDeferred tax liabilities\n\n  \n \n25\n \n  \n \n175,228\n \n \n \n211,391\n \n\nInsurance contract liabilities\n\n  \n \n13\n \n  \n \n12,689,306\n \n \n \n-\n \n\nParticipation and residual liabilities in the Pictures segment\n\n  \n \n18\n \n  \n \n188,919\n \n \n \n140,893\n \n\nOther financial liabilities\n\n  \n \n5\n \n  \n \n574,351\n \n \n \n105,827\n \n\nOther\nnon-current\nliabilities\n\n  \n \n19\n \n  \n \n162,647\n \n \n \n156,233\n \n\nTotal\nnon-current\nliabilities\n\n  \n \n \n \n  \n \n16,094,234\n \n \n \n2,137,277\n \n\nTotal liabilities\n\n  \n \n \n \n  \n \n26,783,022\n \n \n \n7,169,901\n \n\nEQUITY\n\n  \n\n  \n\n \n\nSony Group Corporation’s stockholders’ equity:\n\n  \n \n20\n \n  \n\n \n\nCommon stock\n\n  \n\n  \n \n881,357\n \n \n \n881,357\n \n\nAdditional\npaid-in\ncapital\n\n  \n\n  \n \n1,483,527\n \n \n \n1,465,499\n \n\nRetained earnings\n\n  \n\n  \n \n6,678,168\n \n \n \n5,294,890\n \n\nAccumulated other comprehensive income\n\n  \n\n  \n \n(566,447\n) \n \n \n1,229,371\n \n\nTreasury stock, at cost\n\n  \n \n \n \n  \n \n(296,860\n) \n \n \n(752,106\n)\n\nEquity attributable to Sony Group Corporation’s stockholders\n\n  \n \n \n \n  \n \n8,179,745\n \n \n \n8,119,011\n \n\nNoncontrolling interests\n\n  \n \n27\n \n  \n \n330,406\n \n \n \n394,578\n \n\nTotal equity\n\n  \n \n \n \n  \n \n8,510,151\n \n \n \n8,513,589\n \n\nTotal liabilities and equity\n\n  \n \n \n \n  \n \n35,293,173\n \n \n \n15,683,490\n \n\nThe accompanying notes are an integral part of these statements.\n\n \n\nF-5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Income\n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n  \n\n  \n\nNote\n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nContinuing operations\n\n  \n\n  \n\n \n\n \n\nSales\n\n  \n \n22\n \n  \n \n11,260,037\n \n \n \n12,034,917\n \n \n \n12,479,620\n \n\nCosts and expenses:\n\n  \n\n  \n\n \n\n \n\nCost of sales\n\n  \n \n7,17,23\n \n  \n \n8,089,317\n \n \n \n8,504,810\n \n \n \n8,635,225\n \n\nSelling, general and administrative\n\n  \n \n17,23\n \n  \n \n2,156,156\n \n \n \n2,256,829\n \n \n \n2,298,638\n \n\nOther operating (income) expense, net\n\n  \n \n23\n \n  \n \n(10,134\n)\n \n\n \n \n(11,222\n) \n \n \n34,056\n \n\nTotal costs and expenses\n\n  \n\n  \n \n10,235,339\n \n \n \n10,750,417\n \n \n \n10,967,919\n \n\nShare of profit (loss) of investments accounted for using the equity method\n\n  \n \n8\n \n  \n \n10,557\n \n \n \n(7,865\n)\n \n \n(64,194\n)\n\nOperating income\n\n  \n\n  \n \n1,035,255\n \n \n \n1,276,635\n \n \n \n1,447,507\n \n\nFinancial income\n\n  \n \n24\n \n  \n \n125,597\n \n \n \n139,024\n \n \n \n76,041\n \n\nFinancial expenses\n\n  \n \n24\n \n  \n \n65,766\n \n \n \n72,461\n \n \n \n101,174\n \n\nIncome before income taxes\n\n  \n\n  \n \n1,095,086\n \n \n \n1,343,198\n \n \n \n1,422,374\n \n\nIncome taxes\n\n  \n \n25\n \n  \n \n239,105\n \n \n \n257,480\n \n \n \n367,108\n \n\nNet income from continuing operations\n\n  \n\n  \n \n855,981\n \n \n \n1,085,718\n \n \n \n1,055,266\n \n\nDiscontinued operations\n\n  \n\n  \n\n \n\n \n\nNet income (loss) from discontinued operations\n\n  \n \n33\n \n  \n \n124,513\n \n \n \n74,169\n \n \n \n(1,357,758\n)\n\nNet income (loss)\n\n  \n\n  \n \n980,494\n \n \n \n1,159,887\n \n \n \n(302,492\n)\n\nNet income (loss) attributable to\n\n  \n\n  \n\n \n\n \n\nSony Group Corporation’s stockholders\n\n  \n\n  \n \n970,573\n \n \n \n1,141,600\n \n \n \n(326,865\n)\n\nNet income from continuing operations\n\n  \n\n  \n \n846,587\n \n \n \n1,067,431\n \n \n \n1,030,893\n \n\nNet income (loss) from discontinued operations\n\n  \n\n  \n \n123,986\n \n \n \n74,169\n \n \n \n(1,357,758\n)\n\nNoncontrolling interests\n\n  \n\n \n\n \n\n \n\n  \n \n9,921\n \n \n \n18,287\n \n \n \n24,373\n \n\nNet income from continuing operations\n\n \n\n \n\n \n\n \n\n \n\n \n\n9,394\n\n \n\n \n\n \n\n18,287\n\n \n\n \n\n \n\n24,373\n\n \n\nNet income from discontinued operations\n\n \n\n \n\n \n\n \n\n \n\n \n\n527\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n  \n \n \n  \n\nYen\n\n \n\n \n  \n \n \n  \n\nFiscal year ended March 31\n\n \n\n  \n  \n\nNote\n\n \n  \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nPer share data:\n\n  \n \n26\n \n  \n\n \n\n \n\nNet income (loss) attributable to Sony Group Corporation’s stockholders\n\n  \n\n  \n\n \n\n \n\n- Basic\n\n  \n\n  \n \n157.66\n \n \n \n188.71\n \n \n \n(54.70\n)\n\nContinuing operations\n\n  \n\n  \n \n137.52\n \n \n \n176.45\n \n \n \n172.51\n \n\nDiscontinued operations\n\n  \n\n \n\n \n\n \n\n  \n \n20.14\n \n \n \n12.26\n \n \n \n(227.21\n)\n\n- Diluted\n\n  \n\n  \n \n157.14\n \n \n \n187.92\n \n \n \n(54.36\n)\n\nContinuing operations\n\n  \n\n  \n \n137.06\n \n \n \n175.71\n \n \n \n171.44\n \n\nDiscontinued operations\n\n  \n\n \n\n \n\n \n\n  \n \n20.08\n \n \n \n12.21\n \n \n \n(225.80\n)\n\nThe accompanying notes are an integral part of these statements.\n\n \n\nF-6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Comprehensive Income\n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n  \n\n  \n\nNote\n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nNet income (loss)\n\n  \n \n    \n \n  \n \n980,494\n \n \n \n1,159,887\n \n \n \n(302,492\n)\n\nOther comprehensive income, net of tax -\n\n  \n \n20\n \n  \n\n \n\n \n\nItems that will not be reclassified to profit or loss\n\n  \n\n  \n\n \n\n \n\nChanges in equity instruments measured at fair value through other comprehensive income\n\n  \n\n  \n \n(54,827\n) \n \n \n(11,533\n) \n \n \n(21,401\n)\n\nRemeasurement of defined benefit pension plans\n\n  \n\n  \n \n27,044\n \n \n \n11,027\n \n \n \n38,221\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n  \n\n  \n \n613\n \n \n \n(911\n) \n \n \n243\n \n\nOther comprehensive income from discontinued operations\n\n  \n\n33\n\n  \n \n(156\n) \n \n \n(1,442\n) \n \n \n857\n \n\nItems that may be reclassified subsequently to profit or loss\n\n  \n\n  \n\n \n\n \n\nCash flow hedges\n\n  \n\n  \n \n1,352\n \n \n \n(4,295\n) \n \n \n(3,384\n)\n\nExchange differences on translating foreign operations\n\n  \n\n  \n \n442,406\n \n \n \n(79,266\n) \n \n \n424,360\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n  \n\n  \n \n4,735\n \n \n \n(337\n) \n \n \n(21,282\n)\n\nOther comprehensive income from discontinued operations\n\n  \n \n33\n \n  \n \n(141,523\n) \n \n \n(113,900\n) \n \n \n1,407,907\n \n\nTotal other comprehensive income, net of tax\n\n  \n \n \n \n  \n \n279,644\n \n \n \n(200,657\n) \n \n \n1,825,521\n \n\nComprehensive income\n\n  \n \n \n \n  \n \n1,260,138\n \n \n \n959,230\n \n \n \n1,523,029\n \n\nTotal Comprehensive income\n\n  \n\n  \n\n \n\n \n\nComprehensive income from continuing operations\n\n  \n\n  \n \n1,277,304\n \n \n \n1,000,403\n \n \n \n1,472,023\n \n\nComprehensive income from discontinued operations\n\n  \n\n33\n\n  \n \n(17,166\n) \n \n \n(41,173\n) \n \n \n51,006\n \n\nComprehensive income attributable to\n\n  \n\n  \n\n \n\n \n\nSony Group Corporation’s stockholders\n\n  \n\n  \n \n1,247,301\n \n \n \n941,030\n \n \n \n1,497,997\n \n\nComprehensive income from continuing operations\n\n  \n\n  \n \n1,264,467\n \n \n \n982,203\n \n \n \n1,446,991\n \n\nComprehensive income from discontinued operations\n\n  \n\n33\n\n  \n \n(17,166\n) \n \n \n(41,173\n) \n \n \n51,006\n \n\nNoncontrolling interests\n\n  \n \n \n \n  \n \n12,837\n \n \n \n18,200\n \n \n \n25,032\n \n\nThe accompanying notes are an integral part of these statements.\n\n \n\nF-7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Changes in Stockholders’ Equity\n\n \n\n \n\n \n\n \n \n \n \n \n\nYen in millions\n\n \n\n  \n \n\nNote\n\n \n \n\nCommon\n\nstock\n\n \n \n\nAdditional\n\npaid-in\n\ncapital\n\n \n \n\nRetained\n\nearnings\n\n \n \n\nAccumulated\n\nother\n\ncomprehensive\n\nincome\n\n \n \n\nTreasury\n\nstock, at\n\ncost\n\n \n \n\nSony Group\n\nCorporation’s\n\nstockholders’\n\nequity\n\n \n \n\nNoncontrolling\n\ninterests\n\n \n \n\nTotal\nequity\n\n \n\nBalance at April 1, 2023\n\n \n\n \n \n880,365\n \n \n \n1,463,807\n \n \n \n5,092,442\n \n \n \n(614,570\n) \n \n \n(223,507\n) \n \n \n6,598,537\n \n \n \n58,613\n \n \n \n6,657,150\n \n\nComprehensive income:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet income\n\n \n\n \n\n \n\n \n \n970,573\n \n \n\n \n\n \n \n970,573\n \n \n \n9,921\n \n \n \n980,494\n \n\nOther comprehensive income, net of tax\n\n \n \n20\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n276,728\n \n \n \n \n \n \n \n276,728\n \n \n \n2,916\n \n \n \n279,644\n \n\nTotal comprehensive income\n\n \n\n \n \n \n \n \n \n \n \n \n \n970,573\n \n \n \n276,728\n \n \n \n \n \n \n \n1,247,301\n \n \n \n12,837\n \n \n \n1,260,138\n \n\nTransfer to retained earnings\n\n \n\n \n\n \n\n \n \n38,221\n \n \n \n(38,221\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n\nTransactions with stockholders and other:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nStock issued under stock-based compensation transactions\n\n \n\n \n \n992\n \n \n \n(1,939\n) \n \n \n(144\n) \n \n\n \n \n19,257\n \n \n \n18,166\n \n \n\n \n \n18,166\n \n\nCompensation expenses related to stock-based compensation transactions\n\n \n\n \n\n \n \n13,956\n \n \n\n \n\n \n\n \n \n13,956\n \n \n\n \n \n13,956\n \n\nDividends declared\n\n \n \n20\n \n \n\n \n\n \n \n(98,685\n) \n \n\n \n\n \n \n(98,685\n) \n \n \n(5,786\n) \n \n \n(104,471\n) \n\nPurchase of treasury stock\n\n \n\n20\n\n \n\n \n\n \n\n \n\n \n \n(202,974\n) \n \n \n(202,974\n) \n \n\n \n \n(202,974\n) \n\nReissuance of treasury stock\n\n \n \n \n \n \n\n \n \n1,786\n \n \n\n \n\n \n \n3,290\n \n \n \n5,076\n \n \n\n \n \n5,076\n \n\nTransactions with noncontrolling interests shareholders and other\n\n \n \n27\n \n \n \n \n \n \n \n5,800\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n5,800\n \n \n \n103,264\n \n \n \n109,064\n \n\nBalance at March 31, 2024\n\n \n \n \n \n \n \n881,357\n \n \n \n1,483,410\n \n \n \n6,002,407\n \n \n \n(376,063\n) \n \n \n(403,934\n) \n \n \n7,587,177\n \n \n \n168,928\n \n \n \n7,756,105\n \n\n \n \n \n \n \n\nYen in millions\n\n \n\n  \n \n\nNote\n\n \n \n\nCommon\n\nstock\n\n \n \n\nAdditional\n\npaid-in\n\ncapital\n\n \n \n\nRetained\n\nearnings\n\n \n \n\nAccumulated\n\nother\n\ncomprehensive\n\nincome\n\n \n \n\nTreasury\n\nstock, at\n\ncost\n\n \n \n\nSony Group\n\nCorporation’s\n\nstockholders’\n\nequity\n\n \n \n\nNoncontrolling\n\ninterests\n\n \n \n\nTotal\nequity\n\n \n\nBalance at April 1, 2024\n\n \n\n \n \n881,357\n \n \n \n1,483,410\n \n \n \n6,002,407\n \n \n \n(376,063\n) \n \n \n(403,934\n) \n \n \n7,587,177\n \n \n \n168,928\n \n \n \n7,756,105\n \n\nComprehensive income:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet income\n\n \n\n \n\n \n\n \n \n1,141,600\n \n \n\n \n\n \n \n1,141,600\n \n \n \n18,287\n \n \n \n1,159,887\n \n\nOther comprehensive income, net of tax\n\n \n \n20\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(200,570\n) \n \n \n \n \n \n \n(200,570\n) \n \n \n(87\n) \n \n \n(200,657\n) \n\nTotal comprehensive income\n\n \n\n \n \n \n \n \n \n \n \n \n \n1,141,600\n \n \n \n(200,570\n) \n \n \n \n \n \n \n941,030\n \n \n \n18,200\n \n \n \n959,230\n \n\nTransfer to retained earnings\n\n \n\n \n\n \n\n \n \n(10,186\n) \n \n \n10,186\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\nTransactions with stockholders and other:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nStock issued under stock-based compensation transactions\n\n \n\n \n\n \n \n3,008\n \n \n \n(1,179\n) \n \n\n \n \n49,608\n \n \n \n51,437\n \n \n\n \n \n51,437\n \n\nCompensation expenses related to stock-based compensation transactions\n\n \n\n \n\n \n \n8,575\n \n \n\n \n\n \n\n \n \n8,575\n \n \n\n \n \n8,575\n \n\nDividends declared\n\n \n \n20\n \n \n\n \n\n \n \n(115,312\n) \n \n\n \n\n \n \n(115,312\n) \n \n \n(7,704\n) \n \n \n(123,016\n) \n\nPurchase of treasury stock\n\n \n \n20\n \n \n\n \n\n \n\n \n\n \n \n(285,548\n) \n \n \n(285,548\n) \n \n\n \n \n(285,548\n) \n\nReissuance of treasury stock\n\n \n\n \n\n \n \n1\n \n \n\n \n\n \n \n4\n \n \n \n5\n \n \n\n \n \n5\n \n\nCancellation of treasury stock\n\n \n \n20\n \n \n\n \n \n(3,848\n) \n \n \n(339,162\n) \n \n\n \n \n343,010\n \n \n \n-\n \n \n\n \n \n-\n \n\nTransactions with noncontrolling interests shareholders and other\n\n \n \n27\n \n \n \n \n \n \n \n(7,619\n) \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n(7,619\n) \n \n \n150,982\n \n \n \n143,363\n \n\nBalance at March 31, 2025\n\n \n \n \n \n \n \n881,357\n \n \n \n1,483,527\n \n \n \n6,678,168\n \n \n \n(566,447\n) \n \n \n(296,860\n) \n \n \n8,179,745\n \n \n \n330,406\n \n \n \n8,510,151\n \n\n(Continued on the following page.)\n\n \n\nF-8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Changes in Stockholders’ Equity (Continued)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nYen in millions\n\n \n\n  \n\n \n\nNote\n\n \n\n \n\nCommon\n\nstock\n\n \n\n \n\nAdditional\n\npaid-in\n\ncapital\n\n \n\n \n\nRetained\n\nearnings\n\n \n\n \n\nAccumulated\n\nother\n\ncomprehensive\n\nincome\n\n \n\n \n\nAccumulated\nother\ncomprehensive\nincome directly\nrelated to\ndisposal groups\nclassified as\nheld for\ndistribution to\nowners\n\n \n\n \n\nTreasury\n\nstock, at\n\ncost\n\n \n\n \n\nSony Group\n\nCorporation’s\n\nstockholders’\n\nequity\n\n \n\n \n\nNoncontrolling\n\ninterests\n\n \n\n \n\nTotal\nequity\n\n \n\nBalance at April 1, 2025\n\n \n\n \n \n881,357\n \n \n \n1,483,527\n \n \n \n6,678,168\n \n \n \n(566,447\n)\n \n\n \n\n-\n\n \n \n(296,860\n)\n \n \n8,179,745\n \n \n \n330,406\n \n \n \n8,510,151\n \n\nComprehensive income:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet income (loss)\n\n \n\n \n\n \n\n \n \n(326,865\n)\n \n\n \n\n \n\n \n \n(326,865\n)\n \n \n24,373\n \n \n \n(302,492\n)\n\nOther comprehensive income, net of tax\n\n \n \n20\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n381,804\n \n \n \n1,443,058\n \n \n \n \n \n \n \n1,824,862\n \n \n \n659\n \n \n \n1,825,521\n \n\nTotal comprehensive income\n\n \n\n \n \n \n \n \n \n \n \n \n \n(326,865\n)\n \n \n381,804\n \n \n \n1,443,058\n \n \n \n \n \n \n \n1,497,997\n \n \n \n25,032\n \n \n \n1,523,029\n \n\nTransfer to retained earnings\n\n \n\n \n\n \n\n \n \n34,251\n \n \n \n(38,305\n)\n \n\n4,054\n\n \n\n \n \n-\n \n \n\n \n \n-\n \n\nTransactions with stockholders and other:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nStock issued under stock-based compensation transactions\n\n \n\n \n\n \n \n8,615\n \n \n \n \n \n \n\n \n\n \n \n66,843\n \n \n \n75,458\n \n \n\n \n \n75,458\n \n\nCompensation expenses related to stock-based compensation transactions\n\n \n\n \n\n \n \n3,608\n \n \n\n \n\n \n\n \n\n \n \n3,608\n \n \n\n \n \n3,608\n \n\nDividends declared\n\n \n \n20\n \n \n\n \n\n \n \n(134,964\n)\n \n\n \n\n \n\n \n \n(134,964\n)\n \n \n(22,190\n)\n \n\n \n \n(157,154\n)\n\nDividends in kind\n\n \n\n20\n\n \n\n \n\n \n\n(955,700\n)\n \n \n \n\n \n\n \n\n \n\n(955,700\n) \n \n\n \n\n(955,700\n) \n\nPurchase of treasury stock\n\n \n \n20\n \n \n\n \n\n \n\n \n\n \n\n \n \n(522,089\n)\n \n\n \n \n(522,089\n)\n \n\n \n \n(522,089\n)\n\nReissuance of treasury stock\n\n \n\n \n\n \n \n0\n \n \n\n \n\n \n\n \n \n0\n \n \n \n0\n \n \n\n \n \n0\n\nTransfer to held for distribution to owners\n\n \n \n33\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n1,447,112\n \n \n \n(1,447,112\n) \n \n \n \n \n \n \n-\n \n \n \n \n \n \n \n-\n \n\nTransactions with noncontrolling interests shareholders and other\n\n \n \n \n \n \n \n \n \n \n \n(30,251\n)\n \n\n \n \n \n \n \n \n5,207\n \n \n \n \n \n \n \n \n \n \n \n(25,044\n)\n \n \n61,330\n \n \n \n36,286\n \n\nBalance at March 31, 2026\n\n \n \n \n \n \n \n881,357\n \n \n \n1,465,499\n \n \n \n5,294,890\n \n \n \n1,229,371\n \n \n \n-\n \n \n \n(752,106\n)\n \n \n8,119,011\n \n \n \n394,578\n \n \n \n8,513,589\n \n\nThe accompanying notes are an integral part of these statements.\n\n \n\nF-\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Cash Flows\n\n \n\n \n\n \n \n \n\nYen in millions\n\n \n\n \n \n \n\nFiscal year ended March 31\n\n \n\n  \n\nNote\n\n \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nCash flows from operating activities:\n\n \n \n\n \n\n \n\nIncome before income taxes from continuing operations\n\n \n \n \n1,095,086\n \n \n \n1,343,198\n \n \n \n1,422,374\n \n\nAdjustments to reconcile income before income taxes from continuing operations to net cash provided by\n(used in) operating activities:\n\n \n \n\n \n\n \n\nDepreciation and amortization, including amortization of contract costs\n\n \n \n \n1,117,292\n \n \n \n1,125,588\n \n \n \n1,180,655\n \n\nOther operating (income) expense, net\n\n23\n \n \n(10,134\n)\n \n\n \n \n\n \n\n \n\n \n \n(11,222\n)\n\n \n\n \n \n \n \n34,056\n \n\nGain on securities, net\n\n24\n \n \n(73,166\n) \n \n \n(75,742\n) \n \n \n(862\n)\n\nShare of (profit) loss of investments accounted for using the equity method, net of dividends\n\n \n \n \n(770\n) \n \n \n18,826\n \n \n \n74,467\n \n\nChanges in assets and liabilities:\n\n \n \n\n \n\n \n\n(Increase) decrease in trade receivables and contract assets\n\n \n \n \n(223,150\n) \n \n \n227,664\n \n \n \n124,104\n \n\nDecrease in inventories\n\n \n \n \n75,641\n \n \n \n199,916\n \n \n \n155,382\n \n\nIncrease in content assets\n\n27\n \n \n(486,183\n) \n \n \n(683,388\n) \n \n \n(665,894\n)\n\nIncrease (decrease) in trade payables\n\n \n \n \n(40,737\n) \n \n \n105,643\n \n \n \n70,541\n \n\nDecrease in taxes payable other than income taxes, net\n\n \n \n \n(22,878\n)\n \n \n \n \n(14,157\n) \n \n \n(32,645\n)\n\nIncrease in other financial assets and other current assets\n\n \n \n \n(21,083\n) \n \n \n(16,972\n) \n \n \n(14,302\n)\n \n\nIncrease in other financial liabilities and other current liabilities\n\n \n \n \n13,364\n \n \n \n41,563\n \n \n \n79,709\n \n\nIncome taxes paid\n\n25\n \n \n(231,545\n) \n \n \n(308,392\n) \n \n \n(234,338\n)\n\nOther\n\n \n \n \n(88,092\n)\n \n \n18,824\n \n \n \n(226,955\n)\n\nTotal net cash provided by operating activities from continuing operations\n\n \n \n \n1,103,645\n \n \n \n1,971,349\n \n \n \n1,966,292\n \n\nNet cash provided by (used in) operating activities from discontinued operations\n\n \n \n \n269,568\n \n \n \n350,326\n \n \n \n(20,675\n)\n\nNet cash provided by operating activities\n\n \n \n \n1,373,213\n \n \n \n2,321,675\n \n \n \n1,945,617\n \n\n(Continued on the following page.)\n\n \n\nF-\n10\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nConsolidated Statements of Cash Flows (Continued)\n\n \n\n \n\n \n \n \n \n\nYen in millions\n\n \n\n \n \n \n \n\nFiscal year ended March 31\n\n \n\n  \n \n\nNote\n\n \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nCash flows from investing activities:\n\n \n\n \n\n \n\n \n\nPayments for property, plant and equipment and other intangible assets\n\n \n\n \n \n(605,779\n)\n \n \n(620,985\n) \n \n \n(457,681\n)\n\nProceeds from sales of property, plant and equipment and other intangible assets\n\n \n\n \n \n11,571\n \n \n \n15,484\n \n \n \n19,720\n \n\nPayments for investments and advances\n\n \n\n \n \n(95,506\n)\n \n \n(98,536\n)\n \n \n(179,650\n)\n\nProceeds from sales or return of investments and collections of advances\n\n \n\n \n \n92,679\n \n \n \n46,540\n \n \n \n13,028\n \n\nPayments for purchases of businesses and other\n\n \n27\n \n \n(199,255\n)\n \n \n(294,417\n)\n \n \n(185,355\n)\n\nProceeds from sales of businesses\n\n \n\n \n \n-\n \n \n \n-\n \n \n \n11,198\n \n\nOther\n\n \n \n \n \n3,131\n \n \n \n48,718\n \n \n \n(5,453\n)\n\nTotal net cash used in investing activities from continuing operations\n\n \n\n \n \n(793,159\n)\n \n \n(903,196\n)\n \n \n(784,193\n)\n\nNet cash used in investing activities from discontinued operations\n\n \n27\n \n \n(25,727\n)\n \n \n(26,924\n)\n \n \n(1,186,349\n)\n\nNet cash used in investing activities\n\n \n \n \n \n(818,886\n)\n \n \n(930,120\n)\n \n \n(1,970,542\n)\n\nCash flows from financing activities:\n\n \n\n \n\n \n\n \n\nIncrease (decrease) in short-term borrowings, net\n\n \n14, 27\n \n \n(18,047\n)\n \n \n(28,547\n)\n \n \n2,950\n \n\nProceeds from issuance of long-term debt\n\n \n14, 27\n \n \n225,176\n \n \n \n139,298\n \n \n \n28,774\n \n\nPayments of long-term debt\n\n \n14, 27\n \n \n(25,991\n)\n \n \n(60,629\n)\n \n \n(135,362\n)\n\nPayments of lease liabilities\n\n \n2, 27\n \n \n(90,849\n)\n \n \n(98,949\n)\n \n \n(85,946\n)\n\nDividends paid\n\n \n\n \n \n(98,620\n)\n \n\n \n \n(115,253\n)\n \n \n(135,028\n)\n\nPayments for purchases of treasury stock\n\n \n20\n \n \n(202,974\n)\n \n \n(285,548\n)\n \n \n(522,089\n)\n\nCapital contribution from\nnon-controlling\ninterests\n\n \n27\n \n \n-\n \n \n \n150,804\n \n \n \n18,442\n \n\nOther\n\n \n \n \n \n13,922\n \n \n \n21,521\n \n \n \n(5,249\n)\n\nTotal net cash used in financing activities from continuing operations\n\n \n\n \n \n(197,383\n)\n \n \n(277,303\n)\n \n \n(833,508\n)\n\nNet cash used in financing activities from discontinued operations\n\n \n\n \n \n(13,326\n)\n \n \n(20,940\n)\n \n \n(9,253\n)\n\nNet cash used in financing activities\n\n \n \n \n \n(210,709\n)\n \n \n(298,243\n)\n \n \n(842,761\n)\n\nEffect of exchange rate changes on cash and cash equivalents\n\n \n\n \n \n82,595\n \n \n \n(19,469\n)\n \n \n95,609\n \n\nNet increase (decrease) in cash and cash equivalents\n\n \n \n \n \n426,213\n \n \n \n1,073,843\n \n \n \n(772,077\n)\n\nCash and cash equivalents at beginning of the fiscal year\n\n \n27\n \n \n1,480,900\n \n \n \n1,907,113\n \n \n \n2,980,956\n \n\nCash and cash equivalents at end of the fiscal year\n\n \n27\n \n \n1,907,113\n \n \n \n2,980,956\n \n \n \n2,208,879\n \n\nThe accompanying notes are an integral part of these statements.\n\n \n\nF-1\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nIndex to Notes to Consolidated Financial Statements\n\n \n\nSony Group Corporation and Consolidated Subsidiaries\n\n \n\n \n  \n\nPage\n\n \n\nNotes to Consolidated Financial Statements\n\n  \n\n1.\n\n  \n[Reporting entity](#fin28719_101)\n  \n \nF-13\n \n\n2.\n\n  \n[Basis of preparation](#fin28719_102)\n  \n \n\nF-13\n\n \n\n3.\n\n  \n[Summary of material accounting policies](#fin28719_103)\n  \n \n\nF-14\n\n \n\n4.\n\n  \n[Business segment information](#fin28719_104)\n  \n \n\nF-29\n\n \n\n5.\n\n  \n[Financial instruments](#fin28719_105)\n  \n \n\nF-33\n\n \n\n6.\n\n  \n[Financial risk management](#fin28719_106)\n  \n \nF-44\n \n\n7.\n\n  \n[Inventories](#fin28719_107)\n  \n \nF-52\n \n\n8.\n\n  \n[Investments in associates and joint ventures](#fin28719_108)\n  \n \n\nF-52\n\n \n\n9.\n\n  \n[Property, plant and equipment](#fin28719_109)\n  \n \n\nF-54\n\n \n\n10.\n\n  \n[Leases](#fin28719_110)\n  \n \n\nF-55\n\n \n\n11.\n\n  \n[Goodwill and intangible assets](#fin28719_111)\n  \n \n\nF-56\n\n \n\n12.\n\n  \n[Impairment of non-financial assets](#fin28719_112)\n  \n \n\nF-60\n\n \n\n13.\n\n  \n[Insurance contracts in the Financial Services business](#fin28719_113)\n  \n \n\nF-60\n\n \n\n14.\n\n  \n[Short-term borrowings and long-term debt](#fin28719_114)\n  \n \n\nF-70\n\n \n\n15.\n\n  \n[Derivative instruments and hedging activities](#fin28719_115)\n  \n \n\nF-71\n\n \n\n16.\n\n  \n[Offsetting of financial assets and financial liabilities](#fin28719_116)\n  \n \n\nF-75\n\n \n\n17.\n\n  \n[Employee benefits](#fin28719_117)\n  \n \n\nF-75\n\n \n\n18.\n\n  \n[Participation and residual liabilities in the Pictures segment](#fin28719_118)\n  \n \n\nF-81\n\n \n\n19.\n\n  \n[Other assets and other liabilities](#fin28719_119)\n  \n \n\nF-81\n\n \n\n20.\n\n  \n[Stockholders’ equity](#fin28719_120)\n  \n \n\nF-82\n\n \n\n21.\n\n  \n[Stock-based compensation plans](#fin28719_121)\n  \n \n\nF-88\n\n \n\n22.\n\n  \n[Revenue](#fin28719_122)\n  \n \n\nF-91\n\n \n\n23.\n\n  \n[Supplemental consolidated statements of income information](#fin28719_123)\n  \n \n\nF-92\n\n \n\n24.\n\n  \n[Financial income and expense](#fin28719_124)\n  \n \n\nF-93\n\n \n\n25.\n\n  \n[Income taxes](#fin28719_125)\n  \n \n\nF-94\n\n \n\n26.\n\n  \n[Reconciliation of the differences between basic and diluted EPS](#fin28719_126)\n  \n \n\nF-98\n\n \n\n27.\n\n  \n[Supplemental cash flow information](#fin28719_127)\n  \n \n\nF-98\n\n \n\n28.\n\n  \n[Structured entities](#fin28719_128)\n  \n \n\nF-101\n\n \n\n29.\n\n  \n[Subsidiaries](#fin28719_129)\n  \n \n\nF-102\n\n \n\n30.\n\n  \n[Acquisitions](#fin28719_130)\n  \n \n\nF-102\n\n \n\n31.\n\n  \n[Related party transactions](#fin28719_131)\n  \n \n\nF-104\n\n \n\n32.\n\n  \n[Purchase commitments, contingent liabilities and other](#fin28719_132)\n  \n \n\nF-105\n\n \n\n33.\n\n  \n[Discontinued operations](#fin28719_132a)\n  \n \nF-106\n \n\n34.\n\n  \n[Subsequent events](#fin28719_133)\n  \n \n\nF-107\n\n \n\n \n\nF-12\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nNotes to Consolidated Financial Statements\n\n \n\nSony Group Corporation and Consolidated Subsidiaries\n\n \n\n1.\n\nReporting entity\n\nSony Group Corporation is a public company domiciled in Japan. Sony Group Corporation and its consolidated subsidiaries (hereinafter collectively referred to as “Sony” or “Sony Group”) are engaged in the development, design, production, manufacture, offer and sale of various kinds of electronic equipment, instruments, and devices for consumer, professional and industrial markets such as network services, home gaming consoles and software, televisions, audio and video recorders and players, still and video cameras, smartphones, and image sensors. Sony’s primary manufacturing facilities are located in Asia including Japan. Sony also utilizes third-party contract manufacturers for certain products. Sony’s products and services are marketed throughout the world by sales subsidiaries and unaffiliated distributors as well as direct sales and offers via the internet. Sony is engaged in the development, production, manufacture, and distribution of recorded music, artists’ live performance and merchandising, the management and licensing of the words and music of songs, and the production and distribution of animation titles and game applications. Sony is also engaged in the production, acquisition and distribution of motion pictures and television programming and the operation of television networks and\n\ndirect-to-consumer\n\n(“DTC”) streaming services.\n\nSony was also engaged in various financial services businesses, including life and\nnon-life\ninsurance businesses through its Japanese insurance subsidiaries and banking business through a Japanese internet-based banking subsidiary. At a meeting of Sony Group Corporation’s Board of Directors (the “Board”) held on May 14, 2025, Sony Group Corporation resolved the plan regarding the execution of a partial\nspin-off\n(the “Partial\nSpin-off\nof the Financial Services business”) of Sony Financial Group Inc. (“SFGI”), a wholly-owned subsidiary which operates the Financial Services business (the “Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business”). In connection with the resolution, the Financial Services business was classified as a discontinued operation. For further information on discontinued operations, refer to Note 33. Sony Group Corporation executed the Partial\nSpin-off\nof the Financial Services business effective October 1, 2025. Consequently, SFGI, which was a wholly-owned subsidiary of Sony Group Corporation, was deconsolidated and became an affiliate accounted for using the equity method.\n\n \n\n2.\n\nBasis of preparation\n\nCompliance with International Financial Reporting Standards\n\nThe consolidated financial statements of Sony have been prepared in accordance with IFRS\n®\nAccounting Standards as issued by the International Accounting Standards Board (“IFRS Accounting Standards”). The term IFRS Accounting Standards also includes IAS\n®\nStandards, SIC\n®\nInterpretations and IFRIC\n®\nInterpretations.\n\nApproval of consolidated financial statements\n\nThe consolidated financial statements were approved by Hiroki Totoki, President and Chief Executive Officer and Representative Corporate Executive Officer, and Lin Tao, Chief Financial Officer and Corporate Executive Officer, on June 18, 2026.\n\nFunctional currency and presentation currency\n\nThe consolidated financial statements have been presented in Japanese yen, which is the functional currency of Sony Group Corporation. All financial information presented in Japanese yen has been rounded to the nearest million Japanese yen.\n\nUse of estimates and judgments\n\nThe preparation of the consolidated financial statements in accordance with IFRS Accounting Standards requires management to make judgments, estimates and assumptions that affect the application of accounting policies, the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities. Actual results could differ from these estimates and assumptions. These estimates and assumptions are reviewed on a continuous basis. Changes in these accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.\n\nInformation about judgments that have been made in the process of applying accounting policies that have significant effects on the amounts reported in the consolidated financial statements is as follows:\n\n \n\n \n\n•\n\n \n\nMeasurement of insurance contract liabilities (Note 3 I. Material accounting policies (11) and Note 13)\n\nInformation about accounting estimates and assumptions that have significant effects on the amounts reported in the consolidated financial statements is as follows:\n\n \n\n \n\n•\n\n \n\nImpairment of\nnon-financial\nassets (Note 3 I. Material accounting policies (10) and Note 12)\n\n \n\n \n\n \n\n•\n\n \n\nMeasurement of film costs and participation and residual liabilities in the Pictures segment (Note 3 I. Material accounting policies (9) and (12), Note 11, and Note 18)\n\n \n\n \n\n•\n\n \n\nRecoverability of deferred tax assets (Note 3 I. Material accounting policies (24) and Note 25)\n\n \n\n \n\n•\n\n \n\nMeasurement of fair value of assets acquired and liabilities assumed in business combinations (Note 3 I. Material accounting policies (2) and Note 30)\n\n \n\nF-1\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nChange in presentation\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Income and loss related to a business classified as a discontinued operation are separately presented, net of income taxes, following net income from continuing operations, in the consolidated statements of income. In accordance with the classification of the Financial Services business as a discontinued operation, the consolidated statements of income, consolidated statements of comprehensive income, consolidated statements of cash flows, and related notes to the consolidated financial statements for comparative periods have been\nre-presented\nseparately for continuing operations and discontinued operations. In the consolidated statements of cash flows, cash flows from operating, investing and financing activities are presented separately for continuing operations and discontinued operations. For further information on discontinued operations, refer to Note 33.\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, “Lease liabilities,” which had previously been included within “Current portion of long-term debt” and “Long-term debt,” have increased in materiality and are presented as a separate caption in the consolidated statements of financial position as of March 31, 2026. In addition, due to this change, “Payments of lease liabilities,” which had been included within “Payments of long-term debt,” are presented separately in the consolidated statements of cash flows for the fiscal year ended March 31, 2026. Furthermore, “Contract liabilities,” which had previously been included within “Other current liabilities,” have also increased in materiality and are presented separately in the consolidated statements of financial position as of March 31, 2026. Corresponding reclassifications have been made to the consolidated statements of financial position as of the end of the fiscal year ended March 31, 2025 and to the consolidated statements of cash flows for the fiscal years ended March 31, 2025 and 2024 to conform to these changes in presentation.\n\n \n\n3.\n\nSummary of material accounting policies\n\n \n\nI.\n\nMaterial accounting policies\n\n \n\n(1)\n\nBasis of consolidation -\n\n \n\n \n\ni)\n\nSubsidiaries\n\nA subsidiary is an entity controlled by Sony Group Corporation. Control is obtained when Sony Group Corporation is exposed, or has rights to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.\n\nThe financial statements of subsidiaries are included in the consolidated financial statements of Sony from the date on which control is obtained until the date on which control is lost.\n\nAll intercompany transactions and balances are eliminated in the preparation of the consolidated financial statements.\n\nIf any accounting policies applied by a subsidiary differ from those applied by Sony, adjustments are made to the financial statements of the subsidiary as necessary.\n\nAny changes in ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. The difference between the amount by which the\nnon-controlling\ninterests are adjusted and the fair value of the consideration is directly recognized in equity and attributed to the owners of Sony. When control over a subsidiary is lost, the investment retained in the former subsidiary is remeasured at fair value as of the date when control is lost, and any gain or loss resulting from the loss of control is recognized in profit or loss.\n\n \n\n \n\nii)\n\nAssociates and joint ventures\n\nAn associate is an entity over which Sony has significant influence, but does not have control or joint control, in terms of financial and operating policies.\n\nA joint venture is an investee whereby two or more parties including Sony have the rights to the net assets of the investee in accordance with the terms of the joint arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.\n\nInvestments in associates and joint ventures are accounted for using the equity method from the date on which significant influence or joint control is obtained until the date on which significant influence or joint control is lost. Under the equity method, investments in associates and joint ventures are recognized at cost, adjusted for Sony’s share of the profit or loss and other comprehensive income of the associates and joint ventures from the date on which Sony obtains significant influence or joint control to the date on which Sony loses such significant influence or joint control. Sony recognizes its share of profit or loss of the investees, net of income taxes after the elimination of unrealized intercompany profits, in the consolidated operating income (loss) to the extent of Sony’s interest in these entities.\n\nFor investments accounted for using the equity method, the carrying amount of each investment is tested for impairment as a single asset, when there is objective evidence that the investments may be impaired.\n\nIf any accounting policies applied by an associate or a joint venture differ from those applied by Sony, adjustments are made to the financial statements of the associate or the joint venture as necessary.\n\n \n\nF-1\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nWhen an investment ceases to be an associate or a joint venture and the use of the equity method is discontinued, any gain or loss arising from discontinuation of the equity method is recognized in profit or loss.\n\n \n\n \n\niii)\n\nJoint operations\n\nA joint operation is a joint arrangement whereby two or more parties including Sony have the rights to the assets, and obligations for the liabilities, relating to the investee in accordance with the terms of the joint arrangement.\n\nSony recognizes its share of the assets, liabilities, revenue and expenses related to joint operations.\n\n \n\n \n\niv)\n\nStructured entities\n\nA structured entity is an entity designed so that voting or similar rights are not the dominant factor in deciding who controls the entity.\n\nSony has control and, therefore, consolidates a structured entity when Sony has exposure or rights to variable returns and has the ability to use its power over the structured entity to affect returns.\n\n \n\n(2)\n\nBusiness combinations -\n\nSony recognizes identifiable assets acquired and the liabilities assumed of an acquiree at their fair values at the acquisition date with limited exceptions.\n\nSony recognizes goodwill when the aggregate of the consideration transferred in a business combination, the amount of any\nnon-controlling\ninterests in the acquiree and the fair value of Sony’s previously held equity interest in the acquiree exceeds the net amount of the identifiable assets and liabilities of the acquiree at the acquisition date. If the aggregate above is less than the net amount of identifiable assets and liabilities, the difference is recognized as a gain. The consideration transferred is calculated as the sum of the fair values of the assets transferred, liabilities assumed and equity interest issued.\nNon-controlling\ninterests are measured either at fair value or based on the\nnon-controlling\ninterests’ proportionate share of the acquiree’s net identifiable assets for each business combination transaction.\n\nAcquisition-related costs are recognized as expenses in the period they are incurred.\n\n \n\n(3)\n\nForeign currency translation -\n\n \n\n \ni)\n\nForeign currency transactions\n\nForeign currency transactions are translated at the exchange rates prevailing at the transaction date or rates that approximate such rates. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the exchange rate at the end of the period. Foreign exchange gains and losses resulting from translation and settlement are generally recognized in profit or loss. They are deferred in other comprehensive income if they relate to qualifying cash flow hedges.\n\n \n\n \nii)\n\nForeign operations\n\nAssets and liabilities of foreign operations such as overseas subsidiaries and associates are translated using the exchange rates at the end of the period, and revenue and expense items are translated using the average exchange rates for the period unless the exchange rates fluctuate significantly. Exchange differences arising from the translation are recognized in other comprehensive income.\n\nOn the disposal of a foreign operation, the cumulative amount of exchange differences relating to that foreign operation is reclassified to profit or loss.\n\n \n\n(4)\n\nCash and cash equivalents -\n\nCash and cash equivalents include all highly liquid investments, with original maturities of three months or less, that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.\n\n \n\n(5)\n\nFinancial instruments -\n\nSony recognizes a financial instrument as a financial asset or a financial liability when Sony becomes party to the contractual provisions of the instrument.\n\nFinancial assets and financial liabilities are initially measured at fair value. Except for financial assets and financial liabilities measured at fair value through profit or loss, transaction costs that are directly attributable to the acquisition or issuance of the financial asset or financial liability are added to the fair value of financial assets or subtracted from the fair value of financial liabilities at initial recognition.\n\n \n\n \n\ni)\n\nNon-derivative\nfinancial assets\n\n \n\n \n\na.\n\nClassification and measurement\n\nNon-derivative\nfinancial assets held by Sony are classified as either financial assets measured at amortized cost, debt instruments measured at fair value through other comprehensive income, equity instruments measured at fair value through other comprehensive income or financial assets measured at fair value through profit or loss.\n\n \n\nF-1\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nFinancial assets measured at amortized cost\n\nSony classifies a financial asset as measured at amortized cost if the financial asset is held within a business model whose objective is to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The financial asset is measured at amortized cost by using the effective interest method after initial recognition. On derecognition of a financial asset measured at amortized cost, the difference between the carrying amount and the consideration received or receivable is recognized in profit or loss.\n\nDebt instruments measured at fair value through other comprehensive income\n\nA debt instrument is classified as a financial asset measured at fair value through other comprehensive income if the debt instrument is held within a business model whose objective is achieved by both collecting contractual cash flows and selling the financial asset and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Changes in the fair value of the financial asset after initial recognition, except for impairment gains or losses and foreign exchange gains or losses, are recognized in other comprehensive income. Interest income from these financial assets is recognized in profit or loss using the effective interest method. On derecognition of a debt instrument measured at fair value through other comprehensive income, the cumulative amount previously recognized in other comprehensive income is reclassified to profit or loss.\n\nIn the life insurance business, the financial assets are held mainly from the perspective of asset-liability management (“ALM”). The objective of holding financial assets in the life insurance business is to match the interest rate sensitivity (duration) of financial assets and insurance contract liabilities as much as possible, in order to ensure sufficient cash flows are available to settle insurance claims when they come due.\n\nSony manages these assets as one portfolio, based on the overall objective of managing duration and liquidity needs in a capital-efficient manner. While some assets within the portfolio may be held for a longer period of time, Sony considers, because of its overall objective for these assets, that all the financial assets are held within one business model whose objective is achieved by both collecting cash flows and selling financial assets.\n\nEquity instruments measured at fair value through other comprehensive income\n\nFor investments in equity instruments which are not held for trading, Sony may make an irrevocable election at initial recognition to present subsequent changes in fair value of the investments in other comprehensive income.\n\nThese financial assets are measured at fair value and subsequent changes in the fair value are recognized in other comprehensive income. Dividends from financial assets are recognized in profit or loss, and the cumulative amount recognized in other comprehensive income is transferred to retained earnings upon derecognition.\n\nFinancial assets measured at fair value through profit or loss\n\nFinancial assets other than those measured at amortized cost or fair value through other comprehensive income are classified as financial assets measured at fair value through profit or loss. Financial assets measured at fair value through profit or loss include financial assets held for trading.\n\nIn the life insurance business, investments held for variable life insurance and individual variable annuity contracts mainly consist of equity securities, debt securities and investment funds, which are measured at fair value through profit or loss.\n\nFor certain financial assets that would not normally be measured at fair value through profit or loss, Sony may, at initial recognition, choose the irrevocable option to measure such financial assets at fair value through profit or loss in order to eliminate or significantly reduce an accounting mismatch.\n\nIn the life insurance business, Sony mitigates accounting mismatches by designating certain debt securities to be measured at fair value through profit or loss, consistent with insurance finance income or expenses incurred from certain variable life insurance and individual variable annuity contracts after applying IFRS 17 “Insurance Contracts” (“IFRS 17”).\n\nIn the banking business, in relation to some fixed-rate debt securities, Sony utilizes derivatives to hedge the risk arising from the changes in the fair value of the debt securities due to unfavorable fluctuations of interest rates, and mitigates accounting mismatches by designating the debt securities to be measured at fair value through profit or loss.\n\n \n\n \n\nb.\n\nDerecognition\n\nSony derecognizes a financial asset when the contractual rights to the cash flows from the financial asset expire, or when Sony transfers the contractual rights to receive the cash flows of the financial asset and transfers substantially all of the risks and rewards of the financial asset.\n\n \n\nF-1\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\nc.\n\nImpairment\n\nSony estimates expected credit losses and recognizes loss allowances for financial assets measured at amortized cost and debt instruments measured at fair value through other comprehensive income. At each reporting date, Sony measures the loss allowance for a financial instrument at an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increased significantly since initial recognition. If, at the reporting date, the credit risk on a financial instrument has not increased significantly since initial recognition, Sony measures the loss allowance for that financial instrument at an amount equal to\n12-month\nexpected credit losses. In assessing whether the credit risk has increased significantly or not, Sony uses the change in the risk of a default occurring over the expected life of the financial instrument and estimates expected credit losses by using the method which reflects the past loss rate and other reasonable and supportable forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.\n\nSony measures the expected credit losses of a financial asset in a way that reflects an unbiased and probability-weighted amount incorporating the time value of money and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions.\n\nHowever, for trade and other receivables, and contract assets including\nnon-current\nother receivables in the Pictures segment, the loss allowance is measured at an amount equal to lifetime expected credit losses irrespective of the change of credit risk on a collective basis or an individual basis incorporating factors such as the\npast-due\nstatus and the attributes of the counterparties.\n\nSony determines a financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred. The criteria that Sony uses to determine that a financial asset is credit-impaired include a default or delinquency of more than 90 days past due in interest or principal payments.\n\nSony writes off the gross carrying amount of a financial asset when it cannot reasonably expect to recover all or part of the asset.\n\nDebt securities and housing loans in the Financial Services business\n\nThe expected credit losses for debt securities and housing loans in the Financial Services business are the product of the probability of default (“PD”), loss given default (“LGD”) and exposure at default (“EAD”), by leveraging the Basel III regulatory framework or based on the external information published by major credit rating agencies. Forward-looking economic information is also included in determining the PD.\n\nAssessments on significant increases in credit risk are performed at the reporting date by comparing the risk of default occurring with that at initial recognition. Sony recognizes and measures the expected credit losses on a collective basis or an individual basis using reasonable and supportable information that is available without undue cost or effort, such as asset type, credit ratings, collateral collectability,\npast-due\nstatus and other relevant characteristics of financial instruments.\n\nIn addition, Sony has applied the low credit risk exemption for certain debt securities rated “investment grade” by major credit rating agencies at the reporting date. For such instruments, Sony assumes that the credit risk has not increased significantly since initial recognition.\n\nIf contractual terms of a loan have been modified, it is necessary to recalculate the gross carrying amount of that loan by using the original effective interest rate and recognize a modification gain or loss in profit or loss.\n\n \n\n \n\nii)\n\nNon-derivative\nfinancial liabilities\n\nSony classifies\nnon-derivative\nfinancial liabilities as either financial liabilities subsequently measured at amortized cost by using the effective interest method or financial liabilities subsequently measured at fair value through profit or loss.\n\nSony derecognizes a financial liability when it is extinguished, meaning when the obligation specified in the contract is discharged, cancelled or expired.\n\n \n\n \n\niii)\n\nDerivative financial instruments and hedge accounting\n\nAll derivatives are recognized as either assets or liabilities in the consolidated statements of financial position at fair value. Changes in the fair value of derivative financial instruments are either recognized periodically through profit or loss or other comprehensive income, depending on whether the derivative financial instrument qualifies as a hedge and the derivative is being used to hedge changes in fair value or cash flows.\n\nDerivative financial instruments held by Sony are accounted for as described below.\n\nCash flow hedges\n\nChanges in the fair value of derivatives that are designated and determined to be effective as cash flow hedges for forecasted transactions or exposures associated with recognized assets or liabilities are initially recorded in other comprehensive income and reclassified to profit or loss when the hedged transaction affects profit or loss. Changes in the fair value of the ineffective portion are immediately recognized in profit or loss.\n\n \n\nF\n-1\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nFair value hedges\n\nChanges in the fair value of derivatives that are designated as hedges of the changes in the fair value risk related to the debt securities are recognized in profit or loss. Changes in the fair value of the hedged item attributable to the hedged risk are recorded in profit or loss.\n\nDerivatives not designated as hedges\n\nChanges in the fair value of derivatives not designated as hedges are immediately recognized in profit or loss.\n\nAssessment of hedge effectiveness\n\nWhen applying hedge accounting, Sony formally documents all hedging relationships between the derivatives designated as hedges and the hedged items, as well as its risk management objectives and strategies for undertaking various hedging activities. Sony links all hedges that are designated as cash flow hedges or fair value hedges to specific assets or liabilities in the consolidated statements of financial position or to the specific forecasted transactions. Sony also assesses, both at the inception of the hedge and on an ongoing basis, whether the derivatives that are designated as hedges have an economic relationship with the hedged item in offsetting changes in fair value or cash flows of hedged items. The effect of credit risk does not dominate the value changes that result from the underlying economic relationship. In addition, the hedge ratio of the hedging relationship is designed to be the same as that resulting from the quantity of the hedged item that Sony actually hedges and the quantity of the hedging instrument that Sony actually uses to hedge that quantity of the hedged item. When it is determined that a derivative no longer has an economic relationship with the hedged item, Sony discontinues hedge accounting.\n\n \n\n \n\niv)\n\nOffsetting a financial asset and a financial liability\n\nSony offsets a financial asset and a financial liability and presents the net amount in the consolidated statements of financial position when Sony currently has a legally enforceable right to set off the recognized amounts and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously.\n\n \n\n(6)\n\nInventories -\n\nInventories are measured at the lower of cost or net realizable value. The cost of inventories is determined on the “weighted average cost” basis. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.\n\n \n\n(7)\n\nProperty, plant and equipment and depreciation -\n\nSony has adopted the cost model for the measurement of property, plant and equipment and presents an item of property, plant and equipment at its cost less any accumulated depreciation and any accumulated impairment losses. The cost of an item of property, plant and equipment includes any costs directly attributable to the acquisition of the asset as well as costs of its dismantlement, removal or restoration. Property, plant and equipment are depreciated on a straight-line basis over their useful lives (depreciation period ranging from 2 to 50 years for buildings and from 2 to 10 years for machinery and equipment). Sony reviews the residual values and the useful lives at each fiscal\nyear-end,\nor sooner if circumstances require.\n\n \n\n(8)\n\nLeases -\n\nWhen entering into a contract, Sony determines whether an arrangement contains a lease at its inception. An arrangement contains a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration.\n\nRight-of-use (“ROU”) assets represent Sony’s right to use an underlying asset for the lease term and lease liabilities represent Sony’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. ROU assets also include any lease payments and initial direct costs incurred on or before the commencement date and exclude lease incentives. In determining the present value of lease payments, Sony generally uses its incremental borrowing rate, as the implicit rate is not available for most of its leases. Sony determines its incremental borrowing rate based on the estimated rate of interest for collateralized borrowings, taking into account the lease term and the economic conditions of each country or region at commencement date. The lease terms may include options to extend or terminate the lease when it is reasonably certain that Sony will exercise that option. If the lease transfers ownership of the underlying asset to the lessee by the end of the lease term or the purchase option is reasonably certain to be exercised, Sony depreciates the ROU assets from the commencement date to the end of the useful life of the underlying assets. Otherwise, Sony depreciates the ROU assets from the commencement date to the earlier of the end of the useful life of the ROU assets or the end of the lease term. Sony accounts for the lease and\nnon-lease\ncomponents as a single lease component. Sony has applied the short-term lease exception for leases with a term of one year or less, where ROU assets and lease liabilities are not recognized and the expense is recognized on a straight-line basis.\n\n \n\nF-1\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(9)\n\nIntangible assets and amortization, including content assets -\n\nIntangible assets are measured using the cost model and stated at cost less accumulated amortization and impairment losses. Intangible assets acquired separately are initially recognized at cost.\n\nIntangible assets with finite useful lives mainly consist of patent rights,\nknow-how,\nlicense agreements, customer relationships, trademarks, software, television carriage contracts (broadcasting agreements), film costs, broadcasting rights, music catalogs, artist contracts, music distribution rights and game content. Patent rights,\nknow-how,\nlicense agreements, trademarks and software are generally amortized on a straight-line basis over\n\n \n3\nto\n10\n\nyears. Customer relationships, television carriage contracts (broadcasting agreements), artist contracts, music distribution rights and game content are generally amortized on a straight-line basis, over\n\n2\nto\n15\n\nyears. Music catalogs are generally amortized on a straight-line basis, over\n\n5\nto\n44\n\nyears. Film costs are amortized using an ultimate revenue method based on the ratio of current period actual revenues to the estimated remaining total revenues. Sony considers that amortization pursuant to the ultimate revenue method reflects the rate at which it plans to consume the future economic benefits related to the asset, and there is a high correlation between revenue and the consumption of the economic benefits embodied in the intangible assets. Broadcasting rights are generally amortized based on\n the\nestimated consumption of the economic benefits or on a straight-line basis over the useful life.\n\nAmortization of intangible assets is included in cost of sales and selling, general and administrative expenses in the consolidated statements of income. Certain intangible assets are assessed to have indefinite lives because there is no foreseeable limit to the period over which such assets are expected to generate net cash flows for Sony.\n\nFilm costs, broadcasting rights, music catalogs, artist contracts, music distribution rights and game content are collectively classified and presented as content assets in the consolidated statements of financial position. Film costs include direct production costs, production overhead, and costs for acquisition and distribution rights for both motion picture and television productions. Broadcasting rights, consisting of acquired programming to be aired on Sony’s television networks and DTC streaming services, are recognized when the license period begins and the program is available for use. Music catalogs are exclusive rights to the recorded music master or music copyrights, which consist of melodies and lyrics of songs, that can be exploited and marketed in various markets. Artist contracts are contracts with recorded music artists or songwriters that provide Sony with exclusive rights to musical works. Music distribution rights are agreements to distribute music content owned by third parties. Game content includes internally developed content, content developed through a third-party arrangement where Sony owns the rights to the content, content acquired externally through contracts with third parties, and agreements to distribute game content owned by third parties.\n\n \n\n(10)\n\nImpairment of\nnon-financial\nassets -\n\nSony reviews the recoverability of its\nnon-financial\nassets, except for inventories, contract costs and deferred tax assets, whenever there is any indication that an asset or a cash-generating unit (“CGU”) may be impaired. In addition, an annual impairment test for goodwill, intangible assets with indefinite useful lives or intangible assets not yet available for use is performed during the fourth quarter of the fiscal year for each CGU or group of CGUs to which the carrying amount of these assets is allocated.\n\nA CGU is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or group of assets. Goodwill is allocated to each CGU or group of CGUs that is expected to benefit from the synergies of a business combination. A CGU or group of CGUs to which goodwill is allocated is not larger than an operating segment.\n\nThe recoverable amount of an asset, a CGU or group of CGUs is the higher of its value in use and fair value less costs of disposal. In assessing value in use, the estimated future cash flows are discounted to their present value using a\npre-tax\ndiscount rate that reflects current market assessments of the time value of money and the risks specific to the assets. This approach uses significant estimates and assumptions, including estimated future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates, earnings or revenue multiples, the determination of appropriate comparable entities and the determination of whether a premium or discount should be applied to comparables. The assumptions used for estimated future cash flows and the timing of such cash flows for each CGU are generally based on the three-year\nmid-range\nplan (“MRP”) and take into account such factors as historical experience, market and industry information, and current and forecasted economic conditions. Perpetual growth rates are generally utilized to determine a terminal value and are generally set after the three-year forecasted period for the MRP.\n\nIf the recoverable amount is determined to be less than the carrying amount of a CGU or group of CGUs, an impairment loss would be recognized equal to the amount by which the carrying amount exceeds the recoverable amount. Such impairment losses are recognized by first reducing the carrying amount of any allocated goodwill and then are allocated to the other assets of the CGU on a pro rata basis of the carrying amount of each asset in the CGU. Impairment losses except for content assets are included in other operating (income) expense, net, and impairment losses for content assets are included in cost of sales in the consolidated statements of income.\n\nAssets other than goodwill are reviewed to assess whether there is any indication that an impairment loss recognized in prior periods may no longer exist or may have decreased. If any such indication exists, the recoverable amount of the asset is determined and a reversal of an impairment loss is recognized when the recoverable amount of the asset exceeds the carrying amount. Any increase in the carrying amount of an asset attributable to the reversal of an impairment loss does not exceed the carrying amount of the asset, net of depreciation and amortization, which would have been determined if an impairment loss had never been recognized for the asset in prior periods.\n\n \n\nF-1\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(11)\n\nInsurance contract liabilities -\n\n \n\n \n\ni)\n\nDefinition and classification of insurance contracts\n\nSony defines insurance contracts as the contracts under which Sony accepts significant insurance risk by agreeing to compensate the policyholder if a specified uncertain future event adversely affects the policyholder. In making this assessment, all substantive rights and obligations, including those arising from laws and regulations, are considered on a\n\ncontract-by-contract\n\nbasis. Sony uses judgment in assessing whether there is a scenario with commercial substance in which there is the possibility of a loss on a present value basis and whether the accepted insurance risk is significant. Contracts that have a legal form of an insurance contract but do not transfer significant insurance risk to Sony are classified as investment contracts and the investment contract liabilities are accounted for as financial liabilities and included in other financial liabilities.\n\nInsurance contracts that Sony underwrites in the life insurance business, which is included in the Financial Services business, mainly consist of whole life, term life, disease and health insurance, variable life insurance, and individual variable annuity contracts. Sony classifies certain variable life insurance and individual variable annuity contracts as insurance contracts with direct participation features, if they meet all of the following conditions on initial recognition:\n\n \n\n \n\n-\n\n \n\nthe contractual terms specify that the policyholder participates in a share of a clearly identified pool of underlying items;\n\n \n\n \n\n-\n\n \n\nSony expects to pay to the policyholder an amount equal to a substantial share of the fair value returns on the underlying items; and\n\n \n\n \n\n-\n\n \n\nSony expects a substantial proportion of any change in the amounts to be paid to the policyholder to vary with the change in the fair value of the underlying items.\n\nAll other insurance contracts are classified as insurance contracts without direct participation features.\n\n \n\n \n\nii)\n\nAggregation of insurance contracts\n\nIn measuring insurance contracts, Sony aggregates the insurance contracts into groups. Each group of insurance contracts is determined by identifying portfolios of insurance contracts. Each portfolio is comprised of contracts that are subject to similar risks and are managed together, and Sony mainly divides each portfolio by the quarter to which the issue date of the insurance contracts belongs. The portfolios are then classified into one of the following three groups based on the profitability of contracts:\n\n \n\n \n\n-\n\n \n\nany contracts that are onerous on initial recognition;\n\n \n\n \n\n-\n\n \n\nany contracts that, on initial recognition, have no significant possibility of becoming onerous subsequently; and\n\n \n\n \n\n-\n\n \n\nany remaining contracts.\n\n \n\n \n\niii)\n\nRecognition and derecognition of insurance contracts\n\nA group of insurance contracts issued by Sony is recognized from the earliest of:\n\n \n\n \n\n-\n\n \n\nthe beginning of the coverage period of the group of insurance contracts;\n\n \n\n \n\n-\n\n \n\nwhen the first payment from the policyholder in the group of insurance contracts becomes due; and\n\n \n\n \n\n-\n\n \n\nwhen facts and circumstances indicate that the group of insurance contracts is onerous.\n\nIf there is no contractual due date, the due date is considered as the day when the first payment is received from the policyholder.\n\nIn addition, only contracts that individually meet the recognition criteria by the end of the reporting period are included in the groups. When contracts individually meet the recognition criteria after the end of the reporting period, they are added to the groups in the reporting period in which they meet the recognition criteria. Composition of the groups is not reassessed in subsequent periods.\n\nInsurance acquisition cash flows are allocated to groups of insurance contracts using a systematic and rational method and considering, in an unbiased way, all reasonable and supportable information that is available without undue cost or effort. If insurance acquisition cash flows are directly attributable to a group of insurance contracts, they are allocated to that group. If insurance acquisition cash flows are directly attributable to a portfolio but not to a group of insurance contracts, then they are allocated to the groups in that portfolio using a systematic and rational method.\n\nSony derecognizes an insurance contract when it is extinguished, i.e., when the obligation specified in the insurance contract expires or is discharged or cancelled. When an insurance contract is derecognized, Sony:\n\n \n\n \n\n-\n\n \n\nadjusts the fulfillment cash flows allocated to the group of insurance contracts to eliminate those relating to the derecognized rights and obligations;\n\n \n\nF-\n20\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n-\n \n\nadjusts the contractual service margin (“CSM”) of the group of insurance contracts for the change in the fulfillment cash flows; and\n\n \n\n \n-\n \n\nadjusts the number of coverage units expected for the remaining insurance contract services to reflect the number of coverage units derecognized from the group of insurance contracts.\n\n \n\n \niv)\n\nContract boundaries\n\nIn measuring groups of insurance contracts, Sony includes all of the future cash flows within the boundary of each contract in the group. Cash flows are within the contract boundary if they arise from substantive rights and obligations that exist during the reporting period in which the policyholder is obliged to pay premiums or Sony has a substantive obligation to provide services (including insurance coverage and any investment services).\n\nA substantive obligation to provide services ends when Sony:\n\n \n\n \n(a)\n\nhas the practical ability to reassess the risks of the particular policyholder and can set a price or level of benefits that fully reflects those reassessed risks; or\n\n \n\n \n(b)\n\nhas the practical ability to reassess the risks of the portfolio that contains the contract and can set a price or level of benefits that fully reflects the risks of that portfolio, and the pricing of the premiums up to the reassessment date does not take into account risks that relate to periods after the reassessment date.\n\nFor cash flows arising during the period after the renewal of the insurance contract with automatic renewal clauses, Sony assesses the contract boundaries and determines that they are within the existing contract boundaries when Sony does not have the above practical ability to reassess the risks.\n\n \n\n \nv)\n\nInitial measurement of insurance contracts not measured under the premium allocation approach (“PAA”)\n\nOn initial recognition, Sony measures a group of insurance contracts as the total of the following:\n\n \n\n \n(a)\n\nFulfillment cash flows\n\nThe fulfillment cash flows of the groups of insurance contracts consist of estimates of the future cash flows and risk adjustments for\nnon-financial\nrisk. The estimates of the future cash flows are adjusted to reflect the time value of money and the associated financial risks, and do not reflect Sony’s\nnon-performance\nrisk. The discount rates reflect the characteristics of the cash flows arising from the groups of insurance contracts, including timing, currency and liquidity of cash flows. The determination of the discount rate that reflects the characteristics of the cash flows and liquidity characteristics of the insurance contracts involves significant estimation. The risk adjustment for\nnon-financial\nrisk, determined separately from the other estimates, is designed to reflect the compensation required for bearing uncertainty about the amount and timing of the cash flows that arise from\nnon-financial\nrisk.\n\n \n\n \n(b)\n\nCSM\n\nThe CSM of a group of insurance contracts represents the unearned profit that Sony will recognize as it provides insurance contract services under those contracts.\n\n \n\n \nvi)\n\nSubsequent measurement of insurance contracts not measured under the PAA\n\nThe carrying amount of a group of insurance contracts at each reporting date is the sum of the liability for incurred claims and the liability for remaining coverage. The liability for incurred claims comprises the fulfillment cash flows for incurred claims and expenses that have not yet been paid, including claims that have been incurred but not yet reported. The liability for remaining coverage comprises the items described below.\n\n \n\n \n(a)\n\nFulfillment cash flows\n\nThe fulfillment cash flows of groups of insurance contracts are measured at the reporting date using current estimates of future cash flows, discount rates, and risk adjustment for\nnon-financial\nrisk. The mortality rates, morbidity rates, lapse and surrender rates, and discount rates, which are used to measure the estimates of the present value of future cash flows, are significant assumptions for measuring insurance contract liabilities not measured under the PAA.\n\n \n\n \n(b)\n\nCSM\n\nThe carrying amount of the CSM of contracts without direct participation features at each reporting date is the carrying amount at the beginning of the fiscal year, adjusted for the following items (items (2), (3)1, (3)2, and (3)4 below are measured using the discount rate determined at initial recognition\n(locked-in\ndiscount rate)):\n\n \n\n \n(1)\n\nthe effect of any new contracts that are added to the group during the current period;\n\n \n\n \n(2)\n\nthe interest accreted on the carrying amount of the CSM during the current period;\n\n \n\nF-21\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n(3)\n\nthe changes in fulfillment cash flows relating to future service including the following items:\n\n \n\n \n1.\n\nexperience adjustments arising from premiums received in the current period that relate to future services (including those for related cash flows such as insurance acquisition cash flows and premium-based taxes);\n\n \n\n \n2.\n\nchanges in estimates of the present value of future cash flows in the liability for remaining coverage (excluding the effect of the time value of money, financial risk and changes therein);\n\n \n\n \n3.\n\ndifferences between any investment component expected to become payable in the current period and the actual investment component that becomes payable in the current period; and\n\n \n\n \n4.\n\nchanges in the risk adjustment for\nnon-financial\nrisk that relate to future services;\n\n \n\n \n(4)\n\nthe effect of any currency exchange differences; and\n\n \n\n \n(5)\n\nthe amount recognized as insurance revenue for insurance contract services provided during the current period, which is determined after all other adjustments above.\n\nThe carrying amount of the CSM of contracts with direct participation features at each reporting date is the carrying amount at the beginning of the fiscal year, adjusted for the following items (items (3)2, (3)3, (3)4, and (3)5 below are measured using the current discount rate):\n\n \n\n \n(1)\n\nthe effect of any new contracts that are added to the group during the current period;\n\n \n\n \n(2)\n\nthe changes in Sony’s share of the fair value of the underlying items;\n\n \n\n \n(3)\n\nthe changes in the fulfillment cash flows that do not vary based on the returns of underlying items including the following items:\n\n \n\n \n1.\n\nchanges in the effect of the time value of money and financial risks including the effect of financial guarantees;\n\n \n\n \n2.\n\nexperience adjustments arising from premiums received in the current period that relate to future services (including those for related cash flows such as insurance acquisition cash flows and premium-based taxes);\n\n \n\n \n3.\n\nchanges in estimates of the present value of future cash flows in the liability for remaining coverage (excluding the effect of the time value of money, financial risk and changes therein);\n\n \n\n \n4.\n\ndifferences between any investment component expected to become payable in the current period and the actual investment component that becomes payable in the current period; and\n\n \n\n \n5.\n\nchanges in the risk adjustment for\nnon-financial\nrisk that relate to future services;\n\n \n\n \n(4)\n\nthe effect of any currency exchange differences; and\n\n \n\n \n(5)\n\nthe amount recognized as insurance revenue for insurance contract services provided during the current period, which is determined after all other adjustments above.\n\nSony has selected an accounting policy to update accounting estimates related to insurance contracts made in the previous interim consolidated financial statements in the subsequent annual and interim consolidated financial statements and to measure the annual results using the\n\nyear-to-date\n\napproach.\n\nChanges in the fulfillment cash flows that relate to current or past services are recognized as profit or loss. Changes in the fulfillment cash flows that relate to future services are adjusted as the CSM or loss component as follows:\n\n \n\n \n-\n \n\nwhen an increase in the fulfillment cash flows exceeds the carrying amount of the CSM, the CSM is reduced to zero and the excess is recognized as insurance service expenses and such excess is recorded as a loss component of the liability for the remaining coverage;\n\n \n\n \n-\n \n\nwhen the CSM is zero, changes in the fulfillment cash flows adjust the loss component within the liability for remaining coverage with correspondence to insurance service expenses; and\n\n \n\n \n-\n \n\nthe excess of any decrease in the fulfillment cash flows over the loss component reduces the loss component to zero and reinstates the CSM.\n\nWhen a loss component exists, Sony allocates the following items between the loss component and the remaining component of the liability for the remaining coverage for the respective group of insurance contracts, based on the ratio of the loss component to the fulfillment cash flows relating to the expected future cash outflows:\n\n \n\n \n(1)\n\nexpected incurred claims and other directly attributable expenses for the period;\n\n \n\n \n(2)\n\nchanges in the risk adjustment for\nnon-financial\nrisk for the risk expired; and\n\n \n\n \n(3)\n\nfinance income (expenses) from insurance contracts issued.\n\nThe amounts of loss component allocation in (1) and (2) above reduce the respective components of insurance revenue and are reflected in insurance service expenses.\n\n \n\nF-22\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\nvii)\n\nMeasurement of insurance contracts measured under the PAA\n\nFor certain insurance contracts with a coverage period of one year or less at initial recognition, Sony uses the PAA to simplify the measurement of the group of insurance contracts.\n\nUnder the PAA, on initial recognition of each group of insurance contracts, the carrying amount of the liability for remaining coverage is measured at the premiums received on initial recognition, minus any insurance acquisition cash flows allocated to the group at the date of the receipt of the premiums. Sony amortizes insurance acquisition cash flows over the coverage period of the group of insurance contracts.\n\nSubsequently, the carrying amount of the liability for remaining coverage is increased by any premiums received and the amortization of insurance acquisition cash flows recognized as expenses, and decreased by the amount recognized as insurance revenue for services provided and any additional insurance acquisition cash flows allocated after initial recognition.\n\n \n\n \n\nviii)\n\n Presentation\n\nPortfolios of insurance contracts that are assets and those that are liabilities are presented separately in the consolidated statements of financial position. If no insured event has occurred and the surrender option has not been exercised as of the reporting date, the insurance contract liabilities are classified as\nnon-current\nliabilities. However, if an insured event occurs or the surrender option is exercised, Sony loses its rights to postpone the payment of these liabilities. In this case, the insurance contract liabilities are classified as current liabilities, as they are due to be settled within 12 months after the end of the reporting period.\n\nSony disaggregated amounts recognized in the consolidated statements of income and the consolidated statements of comprehensive income into insurance revenue and insurance service expenses (collectively referred to as the “insurance service result”), and insurance finance income or expenses. Sony did not disaggregate changes in the risk adjustment for\nnon-financial\nrisk between the insurance service result and insurance finance income or expenses and included them in the insurance service result.\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, income and loss from the Financial Services business is included in net income (loss) from discontinued operations. For further information on discontinued operations, refer to Note 33.\n\n \n\n \n\n(a)\n\nInsurance revenue\n\nInsurance revenue excludes any investment components and is recognized as follows:\n\n \n\n \n\n(1)\n\nContracts not measured under the PAA\n\nSony recognizes insurance revenue as it provides insurance contract services. For contracts not measured under the PAA, the insurance revenue relating to services provided for each period represents the total of the changes in the liability for remaining coverage that relate to services for which Sony expects to receive consideration, and primarily comprises the following items:\n\n \n\n \n\n-\n\n \n\na release of the CSM, measured based on coverage units provided during the current period;\n\n \n\n \n\n-\n\n \n\nchanges in the risk adjustment for\nnon-financial\nrisk relating to current services;\n\n \n\n \n\n-\n\n \n\nclaims and other insurance service expenses incurred during the current period, measured at the amounts expected at the beginning of the current period; and\n\n \n\n \n\n-\n\n \n\nallocation of the amount of insurance acquisition cash flows in a systematic way based on the passage of time.\n\nThe release amount of the CSM of a group of insurance contracts that is recognized as insurance revenue in each period is determined by identifying the coverage units in the group and recognizing in profit or loss the amount of the CSM allocated to the coverage units provided during the current period. The number of coverage units is the quantity of services provided based on the insurance contracts in the group, determined by considering the quantity of benefits to be provided by each insurance contract in the group and the expected coverage period.\n\nServices provided based on insurance contracts include insurance coverage and, for all direct participating contracts, investment related services for managing underlying items on behalf of policyholders. Insurance contracts other than direct participating contracts include investment return services for generating an investment return for the policyholder.\n\n \n\n \n\n(2)\n\nContracts measured under the PAA\n\nFor contracts measured under the PAA, the insurance revenue for each period is the amount of expected premium receipts for providing services during the period. Sony allocates the expected premium receipts to each period based mainly on the passage of time.\n\n \n\nF-2\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\n(b)\n\nInsurance service expenses\n\nInsurance service expenses comprise the following items:\n\n \n\n \n\n(1)\n\nincurred claims and benefits excluding investment components and reduced by the loss component allocation;\n\n \n\n \n\n(2)\n\nother incurred and directly attributable insurance service expenses (reduced by the loss component allocation);\n\n \n\n \n\n(3)\n\namortization of insurance acquisition cash flows;\n\n \n\n \n\n(4)\n\nchanges that relate to past services (e.g., changes in the fulfillment cash flows relating to the liability for incurred claims); and\n\n \n\n \n\n(5)\n\nchanges that relate to future services (e.g., losses on onerous insurance contracts and reversal of those losses arising from changes in the loss components).\n\nFor contracts not measured under the PAA, amortization of insurance acquisition cash flows is reflected in insurance service expenses in the same amount as insurance acquisition cash flows recovery reflected within insurance revenue as described above.\n\n \n\n \n\n(c)\n\nInsurance finance income or expenses\n\nInsurance finance income or expenses comprise changes in the carrying amounts of groups of insurance contracts arising from the effects of the time value of money, financial risk and changes therein. Sony has chosen to disaggregate insurance finance income or expenses between profit or loss and other comprehensive income for contracts without direct participation features, excluding certain variable life insurance and individual variable annuity contracts. The amount included in profit or loss is determined by a systematic allocation of the expected total insurance finance income or expenses over the duration of the group of insurance contracts. The amount of systematic allocation is determined using the discount rates determined on initial recognition of the group of insurance contracts. As a result of this systematic allocation, the total amounts recognized in other comprehensive income is equal to zero over the duration of the group of insurance contracts. In addition, the cumulative amount recognized in other comprehensive income at any point in time is the difference between the carrying amount of the group of insurance contracts and the amount measured by this systematic allocation.\n\nFor contracts with direct participation features, the insurance finance income or expenses include changes in the value of underlying items (excluding additional premium payments and withdrawals), all of which are recognized in profit or loss.\n\n(12) Provisions -\n\nProvisions are recognized when Sony has present legal or constructive obligations as a result of past events, it is probable that outflows of resources embodying economic benefits will be required to settle the obligations, and reliable estimates can be made of the amount of obligations.\n\nProvisions mainly consist of participation and residual liabilities in the Pictures segment and product warranties. Product warranties are included in other current liabilities in the consolidated statements of financial position.\n\n \n\n \n\ni)\n\nParticipation and residual liabilities in the Pictures segment\n\nParties involved in the production or exploitation of film and television content may be compensated in part by contingent payments based on the financial results of a film or television show pursuant to contractual formulas (participations) and by contingent amounts due under provisions of collective bargaining agreements (residuals). Such parties are collectively referred to as participants, and such costs are collectively referred to as participation and residual costs. Participation and residual costs may be given to creative talent, such as actors or writers, investors or to entities from whom distribution rights are licensed.\n\nParticipation and residual liabilities are accrued based on the ratio of current period actual revenues to the estimated remaining total revenues. The participation and residual liabilities are expected to be relieved when the contingent payments are fixed and paid. The majority of the\nnon-current\nportion of participation and residual liabilities is expected to be paid within the next 10 years.\n\nSony also enters into arrangements with other studios to jointly produce and distribute films, under which each partner is responsible for the distribution of the film in specific territories or distribution windows. The partners’ shares in the profits and losses of the films under these arrangements are included within participation and residual costs.\n\n \n\n \n\nii)\n\nProduct warranties\n\nSony guarantees delivered products and rendered services for a certain period or term and records product warranties to prepare for such expenses. Product warranties are calculated based upon product sales, estimated probability of failure and estimated cost per claim. The estimates and forecasts used in the calculation of product warranties are reviewed on a periodic basis.\n\n \n\nF-2\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(13)\n\nEmployee benefits -\n\n \n\n \n\ni)\n\nPost-employment benefits\n\nSony adopts defined benefit plans and defined contribution plans.\n\nDefined benefit plans\n\nSony recognizes the net defined benefit liability or asset of defined benefit plans in the consolidated statements of financial position as the amount of the present value of defined benefit obligations less the fair value of plan assets.\n\nThe present value of defined benefit obligations is calculated by discounting the expected future benefit, and service costs are determined by using the projected unit credit method. If the fair value of plan assets is in excess of the present value of defined benefit obligations, the amount of any asset to be recognized is limited to the present value of any economic benefits available in the form of refunds from the plan or reductions in the future contributions to the plan. The discount rate is determined by reference to market yields at each fiscal\nyear-end\non high-quality corporate bonds which have approximately the same term as the defined benefit obligations and are payable in the same currency as the benefit payments. Net interest on the net defined benefit liability or asset is calculated by multiplying the net defined benefit liability or asset by the discount rate.\n\nPast service cost, which is the change in the present value of the defined benefit obligation resulting from a plan amendment or curtailment, is recognized in profit or loss.\n\nRemeasurements of the net defined benefit liability or asset are recognized in other comprehensive income when they occur and transferred to retained earnings immediately.\n\nDefined contribution plans\n\nSony recognizes contributions to defined contribution plans as expenses when employees have rendered related services.\n\n \n\n \n\nii)\n\nShort-term employee benefits\n\nSony recognizes short-term employee benefits, such as salaries, bonuses and annual paid absences, as expenses at the amount expected to be paid in exchange for services when employees have rendered such services.\n\n \n\n(14)\n\nStock-based compensation -\n\n \n\n \n\ni)\n\nStock option plan\n\nSony estimates the cost of stock options at their fair value on the grant date and recognizes the expense over the vesting period with a corresponding increase in equity. The fair value of options granted is calculated using the Black-Scholes model with consideration for terms and conditions of the stock options.\n\n \n\n \n\nii)\n\nRestricted stock unit plan\n\nSony estimates the cost of restricted stock units by the fair value of the units granted on the grant date and recognizes the expense over the vesting period with a corresponding increase in equity.\n\n \n\n(15)\n\nFair value measurement -\n\nSony measures fair value as an exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date.\n\nSony determines a hierarchy of inputs to valuation techniques based on the extent to which inputs used in measuring fair value are observable in the market. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect assumptions which Sony developed using the information that market participants would use in pricing the asset or liability. Observable market data is used if such data is available without undue cost and effort. Each fair value measurement is reported in one of three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety.\n\nThese levels are:\n\n \n\nLevel 1\n\n \n\n-\n\n \n\nInputs are unadjusted quoted prices for identical assets and liabilities in active markets.\n\nLevel 2\n\n \n\n-\n\n \n\nInputs are based on observable inputs other than Level 1 prices, such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets.\n\nLevel 3\n\n \n\n-\n\n \n\nOne or more significant inputs are unobservable.\n\n \n\nF-2\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nWhen available, Sony uses unadjusted quoted market prices in active markets to measure fair value and classifies such items within Level 1. If quoted market prices are not available, fair value is based upon internally developed valuation techniques that use, where possible, current market-based or independently sourced market parameters, such as interest rates, currency rates and option volatilities. Items valued using internally generated models are classified according to the lowest level input that is significant to the valuation. For certain financial assets and liabilities, Sony determines fair value using third-party information such as indicative quotes from dealers and quantitative input from investment advisors following Sony’s established valuation procedures including validation against internally developed prices. Additionally, Sony considers both counterparty credit risk and Sony’s own creditworthiness in determining fair value. Sony attempts to mitigate credit risk to third parties by entering into netting agreements and actively monitoring the creditworthiness of counterparties and its exposure to credit risk through the use of credit limits and by selecting major international banks and financial institutions as counterparties.\n\nTransfers between levels are deemed to have occurred at the beginning of each reporting period in which the transfers occur.\n\n \n\n(16)\n\nRevenue recognition -\n\nSony recognizes revenue in an amount that reflects the consideration Sony expects in exchange for satisfying performance obligations to transfer the goods or services promised in contracts with customers. This is in accordance with the following steps:\n\nStep 1: Identify the contract(s) with a customer.\n\nStep 2: Identify the performance obligations in the contract.\n\nStep 3: Determine the transaction price.\n\nStep 4: Allocate the transaction price to the performance obligations in the contract.\n\nStep 5: Recognize revenue when (or as) Sony satisfies a performance obligation.\n\nSony owns a variety of intellectual property throughout its segments and recognizes revenue through the licensing of such intellectual property. Sony licenses rights to use its intellectual property and rights to access its intellectual property. When Sony grants a customer the right to use Sony’s intellectual property, Sony satisfies its performance obligation at the point in time when the customer obtains control and is entitled to benefit from the license. When Sony grants a customer the right to access Sony’s intellectual property, Sony satisfies its performance obligation over the license period.\n\nIncremental costs of obtaining a contract and costs to fulfill a contract are recognized as assets when Sony expects to recover these costs. The incremental costs of obtaining a contract are those costs that would not have been incurred if the contract had not been obtained. Costs to fulfill a contract are those costs that are directly related to a contract or to an anticipated contract and that generate or enhance resources for Sony to satisfy its performance obligations. Sony applies a practical expedient and recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that would have been recognized is one year or less.\n\nPerformance obligations in contracts for the Entertainment, Technology & Services (“ET&S”) and Imaging & Sensing Solutions (“I&SS”) segments are primarily to deliver various kinds of electronic equipment, instruments and devices to customers. Revenues from these performance obligations are generally recognized when a promised good is delivered to a customer. However, if the sales contract contains a customer acceptance provision, then revenues are recognized when the customer accepts the promised good or when a deemed acceptance occurs by the lapse of time. Revenues are also recognized over time, primarily from the provision of internet broadband network services to subscribers over the subscription period. Revenues are recognized net of anticipated returns and sales incentives.\n\nWithin the Game & Network Services (“G&NS”) segment, revenues from hardware, peripherals and software discs are recognized when performance obligations are satisfied by transferring control to the retailer/distributor, net of anticipated returns, sales incentives and cooperative advertising obligations. Revenues from platform licensing to publishers are recognized when physical software discs are delivered. Revenues from digital game content, which is a right to use Sony’s intellectual property, are recognized when the digital content is made available for use by the licensee via an online platform, net of anticipated sales incentives and credit card chargebacks. Revenues from digital game content involving multiple performance obligations, such as obligations to make content available on future dates, are allocated to each performance obligation based on the relative standalone selling prices that are observable in the market or Sony’s best estimate. Revenues from subscription fees for digital subscription services are recognized over the subscription period.\n\nWithin the Music segment, Sony licenses intellectual property that transfer to a customer either a right to use Sony’s intellectual property, or a right to access Sony’s intellectual property. Revenues are recognized when the customer has the right to use or access the intellectual property and obtains control of the use or access of that license. Digital revenues include revenues from contracts with digital streaming services typically recognized as a single performance obligation, which is ongoing access to intellectual property in an evolving library of content over the contract term, predicated on: (1) the business practice and contractual ability to remove specific content without a requirement to replace the content and without impact to minimum royalty guarantees and (2) the contracts not containing a specific listing of content subject to the license. For these contracts, revenues are recognized based on sales and usage royalties, except where there is a minimum royalty guarantee that\n\n \n\nF-2\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nis not expected to be recouped, or a fixed fee, which is recognized on a straight-line basis over the term of the contract. Revenues from the sale of physical products such as CDs, net of anticipated returns and sales incentives, are recognized when delivery has occurred and the product is available for sale to the public.\n\nWithin the Pictures segment, revenues from the theatrical exhibition of motion pictures are recognized as the customer exhibits the film. Revenues from the licensing of motion picture and television programming for pay and free television exhibition and other markets are recognized when the product is available for use by the licensee. Revenues for motion picture and television program licensing arrangements involving multiple performance obligations, for example a fee for multiple titles, territories or availability dates, are allocated based on the relative standalone selling price of each performance obligation using Sony’s best estimate based on available information such as market conditions and internal pricing guidelines. Each individual motion picture or television programming product delivered generally represents a separate performance obligation. Licensing revenue associated with renewals or extensions of existing agreements for motion pictures and television programming is recognized when the licensee can use and benefit from the content under the renewal or extension. Licensing revenue associated with minimum guarantees for a right to access Sony’s intellectual property is recognized ratably over the license term. Revenues from electronic sell-through and\n\nvideo-on-demand\n\nare recognized when the product is made available for viewing via digital distribution platforms. Revenues from the sale of broadcast advertising are recognized when the advertisement is aired, and the performance obligation in these arrangements is the delivery of advertising spots and may include a guaranteed amount of impressions. When a guarantee for a number of impressions is not achieved, revenues are not recognized until additional advertising spots are delivered to provide the guaranteed impressions. Revenues from subscription fees received by television networks and DTC streaming services are recognized when the service is provided. The performance obligation under network subscription arrangements is a right to use Sony’s intellectual property that is satisfied as programming is provided over the term of the arrangement.\n\nRevenue is generally recognized net of any taxes collected from customers and subsequently remitted to governmental authorities.\n\n \n\n(17)\n\nFinancial services revenue -\n\nFinancial services revenue consisted of insurance revenue and other financial services revenue (refer to Note 3 I. Material accounting policies (11) regarding insurance revenue). Other financial services revenue included items such as interest, dividends and the impact of foreign exchange rate fluctuations incurred from financial instruments held in the Financial Services business.\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, income and loss from the Financial Services business, including financial services revenue, is included in net income (loss) from discontinued operations. For further information on discontinued operations, refer to Note 33.\n\n \n\n(18)\n\nCost of sales -\n\nCosts classified as cost of sales relate to the producing and manufacturing of products and include items such as material cost, subcontractor cost, depreciation of property, plant and equipment, amortization of intangible assets including content assets, employee benefits expenses and research and development costs.\n\n \n\n(19)\n\nResearch and development expenditures -\n\nResearch and development expenditures include items such as employee benefits expenses and other direct and indirect expenses associated with research and product development. Development expenditures are capitalized only when technical feasibility is achieved, Sony has the intention, ability and sufficient resources to use or sell the outcome of the development, it is probable that the outcome will generate a future economic benefit, and the cost can be reliably measured. Capitalized development costs are measured as the sum of total expenditures for development upon achieving the foregoing conditions for capitalization until development is completed. Research expenditures and other development expenditures that do not meet the foregoing conditions are expensed as incurred and included in the cost of sales in the consolidated statements of income.\n\n \n\n(20)\n\nSelling, general and administrative -\n\nCosts classified as selling expenses relate to promoting and selling products and include items such as advertising, promotion, shipping and warranty expenses. General and administrative expenses include operating items such as employee benefits expenses, depreciation of property, plant and equipment, office rental for sales, marketing and administrative divisions, loss allowance for trade receivables and amortization of intangible assets.\n\n \n\n(21)\n\nAdvertising costs -\n\nAdvertising costs are expensed as incurred.\n\n \n\n(22)\n\nShipping and handling costs -\n\nThe majority of shipping and handling, warehousing and internal transfer costs for finished goods are included in selling, general and administrative expenses. However, in the Pictures segment, certain costs are charged to cost of sales as they are\n\n \n\nF-2\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nan integral part of producing and distributing motion pictures and television programming. All other costs related to Sony’s distribution network are included in cost of sales, including inbound freight charges, purchasing and receiving costs, inspection costs and warehousing costs for raw materials and\nin-process\ninventory. Shipping and handling activities that occur after control of the related good transfers are treated as separate performance obligations. Amounts paid by customers for shipping and handling costs are included in sales.\n\n(23)\n\nFinancial services expenses -\n\nFinancial services expenses consisted of insurance service expenses, insurance finance income or expenses, and other financial services expenses (refer to Note 3 I. Material accounting policies (11) regarding insurance service expenses, and insurance finance income or expenses). Other financial services expenses included items such as interest expenses in the banking business.\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, income and loss from the Financial Services business, including financial services expenses, is included in net income (loss) from discontinued operations. For further information on discontinued operations, refer to Note 33.\n\n \n\n(24)\n\nIncome taxes -\n\nIncome taxes consist of current and deferred taxes. Current and deferred taxes are recognized in profit or loss, except to the extent that the tax arises from a business combination, or a transaction or event which is recognized, in the same or a different period, outside profit or loss, either in other comprehensive income or directly in equity.\n\nCurrent taxes are computed based on taxable profit or loss for the year, using the tax rates enacted or substantively enacted at the end of the reporting period.\n\nDeferred tax assets and liabilities are recognized for temporary differences between the tax bases of assets and liabilities and their carrying amounts at the end of the reporting period. Deferred tax liabilities include the liabilities being recognized for undistributed profits of subsidiaries and associates accounted for under the equity method that are expected to be remitted in the foreseeable future. Deferred income taxes are determined using tax rates and laws that have been enacted or substantively enacted by the end of the reporting period and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled. Deferred tax assets and liabilities are not recognized in respect of temporary differences that arise from the initial recognition of an asset or liability in a transaction which is not a business combination and which, at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).\n\nDeferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which the assets can be utilized. Accordingly, the valuation of the deferred tax assets is assessed periodically with available evidence related to the recoverability of the deferred tax assets. Management’s judgment related to this assessment considers the nature, frequency and severity of current and cumulative losses on an individual tax jurisdiction basis, forecasts of future profitability after consideration of uncertain tax positions, excess of appreciated asset value over the tax basis of net assets, the duration of statutory carryforward periods, the past utilization of net operating loss carryforwards prior to expiration, as well as prudent and feasible tax planning strategies which would be employed by Sony to prevent net operating loss and tax credit carryforwards from expiring unutilized.\n\nSony records assets and liabilities resulting from uncertain tax positions taken or expected to be taken in a tax return. The amount of income taxes Sony pays is subject to ongoing audits by various taxing authorities, which may result in proposed assessments. In addition, several significant items related to intercompany transfer pricing are currently the subject of negotiations between taxing authorities in different jurisdictions as a result of pending advance pricing agreement applications and competent authority requests. Sony’s estimate for the potential outcome for any uncertain tax issues is judgmental and requires significant estimates. Sony assesses its income tax positions and records tax benefits and expenses for all years subject to examinations based upon the evaluation of the facts, circumstances and information available at that reporting date.\n\n \n\n(25)\n\nNet income (loss) attributable to Sony Group Corporation’s stockholders per share (“EPS”) -\n\nBasic EPS is computed based on the weighted-average number of shares of common stock outstanding during each period. The computation of diluted EPS reflects the maximum possible dilution from conversion, exercise, or contingent issuance of securities. All potentially dilutive securities are excluded from the calculation in a situation where there is a net loss attributable to Sony Group Corporation’s stockholders.\n\n \n\nII.\n\nNew accounting standards and interpretations not yet adopted\n\nMajor new or amended standards and interpretations that have been issued as of the date of approval of the consolidated financial statements which are not effective and have not yet been adopted by Sony as of March 31, 2026 are as follows:\n\nAmendments to IFRS 9 “Financial Instruments” and IFRS 7 “Financial Instruments: Disclosures”\n\nIn May 2024, the IASB issued “Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and 7).” These amendments were issued to improve the disclosure of information such as investments in equity instruments designated at fair value through other comprehensive income, among other items, and are effective for Sony as of April 1, 2026. They will have no impact on Sony’s results of operations and financial position.\n\n \n\nF-2\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nIFRS 18 “Presentation and Disclosure in Financial Statements”\n\nIn April 2024, the IASB issued IFRS 18 “Presentation and Disclosure in Financial Statements” (“IFRS 18”). IFRS 18 mainly introduces three sets of requirements to give investors more transparent and comparable information about companies’ financial performance: additional subtotals with newly defined categories for classifying income and expenses in the statements of profit or loss, disclosures about management-defined performance measures, and enhanced requirements for more useful grouping of information in the financial statements.\n\nIFRS 18 will be effective for Sony as of April 1, 2027, with early adoption permitted. The impact of IFRS 18 on Sony’s consolidated financial statements is being evaluated.\n\n \n\n4.\n\nBusiness segment information\n\nThe reportable segments presented below are the segments of Sony for which separate financial information is available and for which operating income or loss amounts are evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The CODM does not evaluate segments using discrete asset information. Sony’s CODM is its President and Chief Executive Officer.\n\nThe G&NS segment includes the production and sales of digital software and\nadd-on\ncontent, the network services businesses and the manufacture and sales of home gaming products. 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 Imaging business, the Sound business, the Network Services business and the Displays business. The I&SS segment includes the image sensors business. 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.\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation and has been excluded from the reporting segments. Consequently, the figures for comparative periods have been\nre-presented\ninto continuing operations and discontinued operations. For further information on discontinued operations, refer to Note 33.\n\nSegment sales:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nSales:\n\n  \n\n \n\n \n\nGame & Network Services -\n\n  \n\n \n\n \n\nCustomers\n\n  \n \n4,172,994\n \n \n \n4,543,571\n \n \n \n4,570,053\n \n\nIntersegment\n\n  \n \n94,740\n \n \n \n126,473\n \n \n \n115,598\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n4,267,734\n \n \n \n4,670,044\n \n \n \n4,685,651\n \n\nMusic -\n\n  \n\n \n\n \n\nCustomers\n\n  \n \n1,594,955\n \n \n \n1,820,263\n \n \n \n2,090,534\n \n\nIntersegment\n\n  \n \n24,003\n \n \n \n22,341\n \n \n \n29,576\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,618,958\n \n \n \n1,842,604\n \n \n \n2,120,110\n \n\nPictures -\n\n  \n\n \n\n \n\nCustomers\n\n  \n \n1,486,717\n \n \n \n1,498,534\n \n \n \n1,486,296\n \n\nIntersegment\n\n  \n \n6,333\n \n \n \n7,410\n \n \n \n12,994\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,493,050\n \n \n \n1,505,944\n \n \n \n1,499,290\n \n\nEntertainment, Technology & Services -\n\n  \n\n \n\n \n\nCustomers\n\n  \n \n2,414,946\n \n \n \n2,362,838\n \n \n \n2,184,815\n \n\nIntersegment\n\n  \n \n38,772\n \n \n \n46,437\n \n \n \n75,717\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n2,453,718\n \n \n \n2,409,275\n \n \n \n2,260,532\n \n\nImaging & Sensing Solutions -\n\n  \n\n \n\n \n\nCustomers\n\n  \n \n1,503,906\n \n \n \n1,712,534\n \n \n \n2,059,020\n \n\nIntersegment\n\n  \n \n98,832\n \n \n \n86,471\n \n \n \n92,513\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,602,738\n \n \n \n1,799,005\n \n \n \n2,151,533\n \n\nAll Other -\n\n  \n\n \n\n \n\nCustomers\n\n  \n \n75,784\n \n \n \n82,477\n \n \n \n74,564\n \n\nIntersegment\n\n  \n \n13,586\n \n \n \n13,856\n \n \n \n14,508\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n89,370\n \n \n \n96,333\n \n \n \n89,072\n \n\nCorporate and elimination\n\n  \n \n(265,531\n) \n \n \n(288,288\n) \n \n \n(326,568\n)\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nConsolidated total\n\n  \n \n11,260,037\n \n \n \n12,034,917\n \n \n \n12,479,620\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-2\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nNote:\n\nG&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.\n\nIntersegment amounts in each segment, as well as Corporate and elimination, include transaction amounts with discontinued operations.\n\nSegment profit (loss):\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nOperating income (loss):\n\n  \n\n \n\n \n\nGame & Network Services\n\n  \n \n290,184\n \n \n \n414,819\n \n \n \n463,258\n \n\nMusic\n\n  \n \n301,662\n \n \n \n357,255\n \n \n \n446,986\n \n\nPictures\n\n  \n \n117,702\n \n \n \n117,284\n \n \n \n104,872\n \n\nEntertainment, Technology & Services\n\n  \n \n187,399\n \n \n \n190,926\n \n \n \n158,584\n \n\nImaging & Sensing Solutions\n\n  \n \n193,541\n \n \n \n261,147\n \n \n \n357,318\n \n\nAll Other\n\n  \n \n1,600\n \n \n \n(17,996\n) \n \n \n(74,646\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,092,088\n \n \n \n1,323,435\n \n \n \n1,456,372\n \n\nCorporate and elimination\n\n  \n \n(56,833\n) \n \n \n(46,800\n) \n \n \n(8,865\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nConsolidated operating income\n\n  \n \n1,035,255\n \n \n \n1,276,635\n \n \n \n1,447,507\n \n\nFinancial income\n\n  \n \n125,597\n \n \n \n139,024\n \n \n \n76,041\n \n\nFinancial expenses\n\n  \n \n(65,766\n) \n \n \n(72,461\n) \n \n \n(101,174\n)\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nConsolidated income before income taxes\n\n  \n \n1,095,086\n \n \n \n1,343,198\n \n \n \n1,422,374\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nOperating income (loss) is sales less costs and expenses, and includes the share of profit (loss) of investments accounted for using the equity method.\n\nOperating income (loss) in each segment, as well as Corporate and elimination, include transaction amounts with discontinued operations. Consolidated operating income and the items below Consolidated operating income do not include income and loss from discontinued operations.\n\nOther significant items:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nShare of profit (loss) of investments accounted for using the\nequity method:\n\n  \n\n \n\n    \n\n \n\n \n\n \n\n    \n\n \n\n \n\n \n\n    \n\n \n\nGame & Network Services\n\n  \n \n922\n \n \n \n823\n \n \n \n871\n \n\nMusic\n\n  \n \n8,550\n \n \n \n10,264\n \n \n \n12,165\n \n\nPictures\n\n  \n \n(235\n) \n \n \n(667\n) \n \n \n(180\n)\n\nEntertainment, Technology & Services\n\n  \n \n777\n \n \n \n1,389\n \n \n \n1,310\n \n\nImaging & Sensing Solutions\n\n  \n \n(4,023\n) \n \n \n(1,318\n) \n \n \n(81\n)\n\nAll Other\n\n  \n \n7,096\n \n \n \n(12,673\n) \n \n \n(69,583\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n13,087\n \n \n \n(2,182\n) \n \n \n(55,498\n) \n\nElimination\n\n  \n \n(2,530\n)\n \n \n(5,683\n) \n \n \n(8,696\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nConsolidated total\n\n  \n \n10,557\n \n \n \n(7,865\n) \n \n \n(64,194\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNote:\n\nDue to an increase in the materiality of Sony’s intersegment transactions, “Elimination” is presented separately beginning from the fiscal year ended March 31, 2026. As a result of this change, results for the fiscal years ended March 31, 2024 and 2025 in the table above have also been reclassified to conform to the current presentation.\n\n \n\nF-\n30\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nDepreciation and amortization:\n\n  \n\n  \n\n  \n\nGame & Network Services\n\n  \n \n123,065\n \n  \n \n141,470\n \n  \n \n147,476\n \n\nMusic\n\n  \n \n84,576\n \n  \n \n106,089\n \n  \n \n130,903\n \n\nPictures\n\n  \n \n541,106\n \n  \n \n491,713\n \n  \n \n517,823\n \n\nEntertainment, Technology & Services\n\n  \n \n101,676\n \n  \n \n99,984\n \n  \n \n103,077\n \n\nImaging & Sensing Solutions\n\n  \n \n247,900\n \n  \n \n273,026\n \n  \n \n265,138\n \n\nAll Other\n\n  \n \n4,830\n \n  \n \n5,165\n \n  \n \n3,946\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,103,153\n \n  \n \n1,117,447\n \n  \n \n1,168,363\n \n\nCorporate and elimination\n\n  \n \n14,139\n \n  \n \n8,141\n \n  \n \n12,292\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nConsolidated total\n\n  \n \n1,117,292\n \n  \n \n1,125,588\n \n  \n \n1,180,655\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSales to customers by product category:\n\nThe following table is a breakdown of sales to external customers by product category for each segment. Sony management views each segment as a single operating segment.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nSales:\n\n  \n\n  \n\n  \n\nGame & Network Services\n\n  \n\n  \n\n  \n\nDigital Software and\nAdd-on\nContent\n\n  \n \n1,934,586\n \n  \n \n2,290,498\n \n  \n \n2,415,305\n \n\nNetwork Services\n\n  \n \n545,537\n \n  \n \n669,873\n \n  \n \n763,126\n \n\nHardware and Others\n\n  \n \n1,692,871\n \n  \n \n1,583,200\n \n  \n \n1,391,622\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n4,172,994\n \n  \n \n4,543,571\n \n  \n \n4,570,053\n \n\nMusic\n\n  \n\n  \n\n  \n\nRecorded Music – Streaming\n\n  \n \n709,453\n \n  \n \n788,772\n \n  \n \n852,672\n \n\nRecorded Music – Others\n\n  \n \n356,646\n \n  \n \n407,260\n \n  \n \n492,656\n \n\nMusic Publishing\n\n  \n \n326,727\n \n  \n \n379,812\n \n  \n \n419,864\n \n\nVisual Media and Platform\n\n  \n \n202,129\n \n  \n \n244,419\n \n  \n \n325,342\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,594,955\n \n  \n \n1,820,263\n \n  \n \n2,090,534\n \n\nPictures\n\n  \n\n  \n\n  \n\nMotion Pictures\n\n  \n \n542,044\n \n  \n \n610,313\n \n  \n \n495,655\n \n\nTelevision Productions\n\n  \n \n551,035\n \n  \n \n459,281\n \n  \n \n512,372\n \n\nMedia Networks\n\n  \n \n393,638\n \n  \n \n428,940\n \n  \n \n478,269\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,486,717\n \n  \n \n1,498,534\n \n  \n \n1,486,296\n \n\nEntertainment, Technology & Services\n\n  \n\n  \n\n  \n\nImaging\n\n  \n \n714,492\n \n  \n \n737,639\n \n  \n \n722,465\n \n\nSound\n\n  \n \n295,592\n \n  \n \n290,538\n \n  \n \n278,846\n \n\nNetwork Services\n\n  \n \n179,200\n \n  \n \n179,704\n \n  \n \n188,308\n \n\nDisplays\n\n  \n \n662,179\n \n  \n \n597,777\n \n  \n \n476,305\n \n\nOther\n\n  \n \n563,483\n \n  \n \n557,180\n \n  \n \n518,891\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n2,414,946\n \n  \n \n2,362,838\n \n  \n \n2,184,815\n \n\nImaging & Sensing Solutions\n\n  \n \n1,503,906\n \n  \n \n1,712,534\n \n  \n \n2,059,020\n \n\nAll Other\n\n  \n \n75,784\n \n  \n \n82,477\n \n  \n \n74,564\n \n\nCorporate and elimination\n\n  \n \n10,735\n \n  \n \n14,700\n \n  \n \n14,338\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nConsolidated total\n\n  \n \n11,260,037\n \n  \n \n12,034,917\n \n  \n \n12,479,620\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNote: Sony has realigned its product categories in the ET&S segment due to changes in business categories from the fiscal year ended March 31, 2026. In accordance with this realignment, results for the fiscal years ended March 31, 2024 and 2025 in the table above have been reclassified to conform to the current presentation.\n\nIn the G&NS segment, Digital Software and\nAdd-on\nContent includes distribution of software titles and\nadd-on\ncontent through the network; 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 and\n\n \n\nF-3\n\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nmerchandising; 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 networks and DTC streaming services worldwide. In the ET&S segment, Imaging includes image and video content creation products and solutions including interchangeable lens cameras and interchangeable lenses; Sound includes headphones and wireless speakers; Network Service includes internet-related services; Displays includes display products such as LCD and OLED televisions as well as projectors; Other includes smartphones, home audio products and medical equipment, as well as sports officiating support and content production support services.\n\nGeographic Information:\n\nSales attributed to countries and areas based on location of external customers for the fiscal years ended March 31, 2024, 2025 and 2026 and\nnon-current\nassets (property, plant and equipment, ROU assets, goodwill, content assets and other intangible assets) as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nSales:\n\n  \n\n  \n\n  \n\nJapan\n\n  \n \n1,266,795\n \n  \n \n1,322,209\n \n  \n \n1,333,202\n \n\nUnited States\n\n  \n \n3,751,239\n \n  \n \n4,127,795\n \n  \n \n4,064,440\n \n\nEurope\n\n  \n \n2,632,963\n \n  \n \n2,630,934\n \n  \n \n2,826,805\n \n\nChina\n\n  \n \n1,000,907\n \n  \n \n1,244,115\n \n  \n \n1,428,677\n \n\nAsia-Pacific\n\n  \n \n1,659,776\n \n  \n \n1,640,582\n \n  \n \n1,694,889\n \n\nOther Areas\n\n  \n \n948,357\n \n  \n \n1,069,282\n \n  \n \n1,131,607\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n11,260,037\n \n  \n \n12,034,917\n \n  \n \n12,479,620\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n  \n \n \n  \n\nYen in millions\n\n \n\n \n  \n \n \n  \n\nMarch 31\n\n \n\n \n  \n \n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nNon-current\nassets (property, plant and equipment, ROU assets, goodwill, content assets and other intangible assets):\n\n  \n\n  \n\n  \n\nJapan\n\n  \n\n  \n \n2,090,652\n \n  \n \n1,919,158\n \n\nUnited States\n\n  \n\n  \n \n2,915,183\n \n  \n \n3,328,940\n \n\nEurope\n\n  \n\n  \n \n989,679\n \n  \n \n1,119,027\n \n\nChina\n\n  \n\n  \n \n27,372\n \n  \n \n29,899\n \n\nAsia-Pacific\n\n  \n\n  \n \n233,895\n \n  \n \n243,264\n \n\nOther Areas\n\n  \n\n  \n \n207,545\n \n  \n \n229,961\n \n\n  \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n\n  \n \n6,464,326\n \n  \n \n6,870,249\n \n\n  \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nMajor countries and areas in each geographic segment excluding Japan, United States and China are as follows:\n\n \n\n(1) Europe:\n\n  \nUnited Kingdom, France, Germany, Spain and Italy\n\n(2) Asia-Pacific:\n\n  \nIndia, South Korea, Oceania, Thailand and Malaysia\n\n(3) Other Areas:\n\n  \nThe Middle East/Africa, Brazil, Mexico and Canada\n\nThere are no individually material countries with respect to sales or\nnon-current\nassets (property, plant and equipment, ROU assets, goodwill, content assets and other intangible assets) included in Europe, Asia-Pacific and Other Areas.\n\nTransfers between reportable business segments or geographic areas are made at individually negotiated prices that are intended to reflect a market-based transfer price.\n\nThere were no sales with any single major external customer for the fiscal years ended March 31, 2024, 2025 and 2026.\n\n \n\nF-3\n\n2\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n5.\n\nFinancial instruments\n\n \n\n(1)\n\nFinancial instruments by measurement method\n\nThe carrying amount of Sony’s assets and liabilities by measurement method as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n  2025  \n\n \n\n \n\n  2026  \n\n \n\nAssets:\n\n  \n\n \n\nFinancial assets required to be measured at amortized cost (“AC”)\n\n  \n\n \n\nInvestments and advances in the Financial Services segment\n\n  \n\n \n\nDebt securities\n\n  \n \n521,054\n \n \n \n-\n \n\nHousing loans in the banking business\n\n  \n \n3,763,261\n \n \n \n-\n \n\nOther loans\n\n  \n \n21,950\n \n \n \n-\n \n\nTrade and other receivables*\n\n  \n\n \n\nTrade receivables\n\n  \n \n1,923,433\n \n \n \n1,806,487\n \n\nOther receivables\n\n  \n \n12,364\n \n \n \n12,071\n \n\nOther financial assets\n\n  \n\n \n\nTime deposit\n\n  \n \n6,179\n \n \n \n4,473\n \n\nSecurity deposit\n\n  \n \n150,950\n \n \n \n29,672\n \n\nNon-current\nother receivables in the Pictures segment\n\n  \n \n104,943\n \n \n \n90,816\n \n\nOther\n\n  \n \n70,514\n \n \n \n87,499\n \n\nFinancial assets required to be measured at fair value through profit or loss (“FVPL”)\n\n  \n\n \n\nInvestments and advances in the Financial Services segment\n\n  \n\n \n\nDebt securities\n\n  \n \n1,394,539\n \n \n \n-\n \n\nEquity securities\n\n  \n \n3,740,189\n \n \n \n-\n \n\nOther financial assets\n\n  \n\n \n\nDebt securities\n\n  \n \n20,555\n \n \n \n23,417\n \n\nEquity securities\n\n  \n \n487,454\n \n \n \n470,508\n \n\nDerivative assets\n\n  \n \n86,141\n \n \n \n27,954\n \n\nFinancial assets designated to be measured at FVPL\n\n  \n\n \n\nInvestments and advances in the Financial Services segment\n\n  \n\n \n\nDebt securities\n\n  \n \n893,972\n \n \n \n-\n \n\nFinancial assets required to be measured at fair value through other comprehensive income (“FVOCI”)\n\n  \n\n \n\nInvestments and advances in the Financial Services segment\n\n  \n\n \n\nDebt securities\n\n  \n \n8,849,130\n \n \n \n-\n \n\nOther financial assets\n\n  \n\n \n\nDebt securities\n\n  \n \n139\n \n \n \n158\n \n\nFinancial assets designated to be measured at FVOCI\n\n  \n\n \n\nInvestments and advances in the Financial Services segment\n\n  \n\n \n\nEquity securities\n\n  \n \n5,880\n \n \n \n-\n \n\nOther financial assets\n\n  \n\n \n\nEquity securities\n\n  \n \n382,947\n \n \n \n467,489\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal assets\n\n  \n \n22,435,594\n \n \n \n3,020,544\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent assets\n\n  \n \n2,534,666\n \n \n \n1,846,725\n \n\nNon-current\nassets\n\n  \n \n19,900,928\n \n \n \n1,173,819\n \n\n \n\n*\n\nThe amounts of trade and other receivables exclude contract assets within trade and other receivables, and contract assets in the consolidated statements of financial position.\n\n \n\nF-3\n\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nCash and cash equivalents are excluded from the table above. Refer to Note 27.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31\n\n \n\n \n \n\n  2025   \n\n \n \n\n   2026   \n\n \n\nLiabilities:\n\n \n\n \n\nFinancial liabilities required to be measured at AC\n\n \n\n \n\nShort-term borrowings\n\n \n \n1,843,959\n \n \n \n51,183\n \n\nCurrent portion of long-term debt*\n1\n\n \n \n196,950\n \n \n \n166,410\n \n\nTrade and other payables\n\n \n\n \n\nTrade payables\n\n \n \n1,927,633\n \n \n \n2,047,388\n \n\nOther payables\n\n \n \n123,454\n \n \n \n139,010\n \n\nDeposits from customers in the banking business*\n2\n\n \n \n4,243,962\n \n \n \n-\n \n\nLong-term debt*\n1\n\n \n \n1,557,867\n \n \n \n824,393\n \n\nLease liabilities*\n1\n\n \n \n599,470\n \n \n \n627,683\n \n\nDeferred consideration*\n3\n\n \n \n95,942\n \n \n \n59,652\n \n\nInvestment contract liabilities\n\n \n \n62,772\n \n \n \n-\n \n\nOther financial liabilities\n\n \n \n79,340\n \n \n \n50,795\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\nOther financial liabilities\n\n \n\n \n\nDerivative liabilities\n\n \n \n154,526\n \n \n \n70,216\n \n\nContingent consideration\n\n \n \n25,785\n \n \n \n16,549\n \n\nFinancial liabilities designated to be measured at FVPL\n\n \n\n \n\nOther financial liabilities\n\n \n\n \n\nRedeemable noncontrolling interests\n\n \n \n52,963\n \n \n \n78,568\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal liabilities\n\n \n \n   10,964,623\n \n \n \n4,131,847\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent liabilities\n\n \n \n8,323,430\n \n \n \n2,668,104\n \n\nNon-current\nliabilities\n\n \n \n2,641,193\n \n \n \n1,463,743\n \n\n \n\n*\n1\n\nAs described in Note 2 (5), “Lease liabilities,” which had previously been included within\n“Current portion of long-term debt” and “Long-term debt,” has increased in materiality and is presented separately from the fiscal year ended March 31, 2026. As a result of this change, \n“Current portion of long-term debt” of 90,495 million yen and\n“Long-term\ndebt” of 508,975 million yen as of March 31, 2025 have been reclassified to “Lease liabilities” of 599,470 million yen.\n\n*2\n\nDeposits from customers in the banking business include the\nnon-current\nportion that is recorded within other financial liabilities in the consolidated statements of financial position.\n\n*3\n\nDeferred consideration is recorded within other financial liabilities or trade and other payables in the consolidated statements of financial position.\n\n \n\n(2)\n\nFinancial instruments measured at fair value on a recurring basis\n\nThe following section describes the valuation techniques used by Sony to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which each instrument is generally classified.\n\nDebt instruments and equity instruments\n\nWhere quoted prices of financial instruments are available in an active market, these instruments are classified in Level 1 of the fair value hierarchy. Level 1 financial instruments include exchange-traded equity instruments. If quoted market prices are not available for the specific financial instruments or the market is inactive, then fair values are estimated by using pricing models, quoted prices of financial instruments with similar characteristics or discounted cash flow method and mainly classified in Level 2 of the fair value hierarchy. Level 2 financial instruments include debt instruments with quoted prices that are not traded as actively as exchange-traded instruments, such as the majority of government bonds and corporate bonds. In certain cases where there is limited activity or less transparency around inputs to the valuation, these instruments are classified within Level 3 of the fair value hierarchy. Level 3 financial instruments primarily include certain private equity investments, investment funds, securitized products which are not classified within Level 1 or Level 2 and domestic and foreign corporate bonds for which quoted prices are not available in a market and where there is less transparency around inputs. Sony estimates the fair value for private equity investments primarily by using comparable company analysis and discounted cash flow method. The price book-value ratio and price earnings ratio of comparable companies, as well as cost of capital and EBITDA multiples for the terminal value used in discounted cash flow method, are primarily used as significant unobservable inputs in the fair value measurement of equity securities classified as Level 3. The fair value increases (decreases) as the price book-value ratio and price earnings ratio of comparable companies rise (decline). In addition, the fair value increases (decreases), as the cost of capital declines (rises) and EBITDA multiples rise (decline), both of which are used in discounted cash flow method. Sony estimates the fair value for certain investment funds by using the net asset value. Sony estimates the fair value\n\n \n\nF-3\n\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nfor securitized products and domestic and foreign corporate bonds for which quoted prices are not available in a market and where there is less transparency around inputs by using third-party information such as indicative quotes from dealers without adjustment or discounted cash flow method. For validating the fair values of Level 3 financial instruments, Sony primarily uses internal models which include management judgment or estimation of assumptions that market participants would use in pricing the asset.\n\nDerivatives\n\nExchange-traded derivatives valued using quoted prices are classified within Level 1 of the fair value hierarchy. However, few classes of derivative contracts are listed on an exchange; thus, the majority of Sony’s derivative positions are valued using internally developed models that use as their basis readily observable market parameters, meaning parameters that are actively quoted and can be validated to external sources, including pricing services. Depending on the types and contractual terms of derivatives, fair value can be modeled using a series of techniques, such as the Black-Scholes model, which are consistently applied. For derivative products that have been established for some time, Sony uses models that are widely accepted in the financial services industry. These models reflect the contractual terms of the derivatives, including the period to maturity, and market-based parameters such as interest rates, volatility, and the credit rating of the counterparty. Further, many of these models do not contain a high level of subjectivity as the techniques used in the models do not require significant judgment, and inputs to the model are readily observable from actively quoted markets. Such instruments are generally classified within Level 2 of the fair value hierarchy. If significant unobservable inputs are used in the models, such instruments are classified within Level 3.\n\nIn determining the fair value of Sony’s interest rate swap derivatives, Sony uses the present value of expected cash flows based on market observable interest rate yield curves commensurate with the term of each instrument. For foreign currency derivatives, Sony’s approach is to use forward contract valuation models employing market observable inputs, such as spot currency rates and time value. These derivatives are classified within Level 2 since Sony primarily uses observable inputs in its valuation of its derivative assets and liabilities.\n\n \n\nF-3\n\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe fair value of Sony’s assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2025 and 2026 is as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 2025\n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nPresentation in the consolidated statements of\n\nfinancial position\n\n \n\n \n \n\nLevel 1\n\n \n \n\nLevel 2\n\n \n \n\nLevel 3\n\n \n \n\nTotal\n\n \n \n\nInvestments\n\nand advances\n\nin the\n\nFinancial\n\nServices\n\nsegment\n\n(Current)\n\n \n \n\nOther\n\nfinancial\n\nassets\n\n(Current)\n\n \n \n\nInvestments\n\nand advances\n\nin the\n\nFinancial\n\nServices\n\nsegment\n\n(Non-current)\n\n \n \n\nOther\n\nfinancial\n\nassets\n\n(Non-current)\n\n \n\nAssets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial assets required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese national government bonds\n\n \n \n-\n \n \n \n411,764\n \n \n \n-\n \n \n \n411,764\n \n \n \n-\n \n \n \n-\n \n \n \n411,764\n \n \n \n-\n \n\nJapanese local government bonds\n\n \n \n-\n \n \n \n1,225\n \n \n \n-\n \n \n \n1,225\n \n \n \n-\n \n \n \n-\n \n \n \n1,225\n \n \n \n-\n \n\nJapanese corporate bonds\n\n \n \n-\n \n \n \n19,828\n \n \n \n33\n \n \n \n19,861\n \n \n \n-\n \n \n \n-\n \n \n \n19,828\n \n \n \n33\n \n\nForeign government bonds\n\n \n \n41,867\n \n \n \n179,346\n \n \n \n-\n \n \n \n221,213\n \n \n \n-\n \n \n \n-\n \n \n \n221,213\n \n \n \n-\n \n\nForeign corporate bonds\n\n \n \n-\n \n \n \n24,657\n \n \n \n2,849\n \n \n \n27,506\n \n \n \n-\n \n \n \n-\n \n \n \n24,657\n \n \n \n2,849\n \n\nInvestment funds\n\n \n \n-\n \n \n \n666,662\n \n \n \n66,863\n \n \n \n733,525\n \n \n \n-\n \n \n \n-\n \n \n \n715,852\n \n \n \n17,673\n \n\nEquity securities\n\n \n \n4,210,845\n \n \n \n7,120\n \n \n \n9,678\n \n \n \n4,227,643\n \n \n \n-\n \n \n \n-\n \n \n \n3,740,189\n \n \n \n487,454\n \n\nDerivative assets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest rate contracts\n\n \n \n-\n \n \n \n65,433\n \n \n \n-\n \n \n \n65,433\n \n \n \n-\n \n \n \n493\n \n \n \n-\n \n \n \n64,940\n \n\nForeign exchange contracts\n\n \n \n-\n \n \n \n15,255\n \n \n \n-\n \n \n \n15,255\n \n \n \n-\n \n \n \n13,821\n \n \n \n-\n \n \n \n1,434\n \n\nEquity contracts\n\n \n \n910\n \n \n \n911\n \n \n \n2,346\n \n \n \n4,167\n \n \n \n-\n \n \n \n4,167\n \n \n \n-\n \n \n \n-\n \n\nBond contracts\n\n \n \n1,286\n \n \n \n-\n \n \n \n-\n \n \n \n1,286\n \n \n \n-\n \n \n \n1,286\n \n \n \n-\n \n \n \n-\n \n\nFinancial assets designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese national government bonds\n\n \n \n-\n \n \n \n757,357\n \n \n \n-\n \n \n \n757,357\n \n \n \n3,494\n \n \n \n-\n \n \n \n753,863\n \n \n \n-\n \n\nJapanese local government bonds\n\n \n \n-\n \n \n \n8,596\n \n \n \n-\n \n \n \n8,596\n \n \n \n8,596\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n\nForeign government bonds\n\n \n \n-\n \n \n \n50,569\n \n \n \n-\n \n \n \n50,569\n \n \n \n5,639\n \n \n \n-\n \n \n \n44,930\n \n \n \n-\n \n\nForeign corporate bonds\n\n \n \n-\n \n \n \n71,408\n \n \n \n6,042\n \n \n \n77,450\n \n \n \n25,659\n \n \n \n-\n \n \n \n51,791\n \n \n \n-\n \n\nFinancial assets required to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese national government bonds\n\n \n \n-\n \n \n \n6,134,141\n \n \n \n-\n \n \n \n6,134,141\n \n \n \n35,000\n \n \n \n-\n \n \n \n6,099,141\n \n \n \n-\n \n\nJapanese local government bonds\n\n \n \n-\n \n \n \n71,752\n \n \n \n-\n \n \n \n71,752\n \n \n \n11,055\n \n \n \n-\n \n \n \n60,697\n \n \n \n-\n \n\nJapanese corporate bonds\n\n \n \n-\n \n \n \n693,016\n \n \n \n111,792\n \n \n \n804,808\n \n \n \n11,087\n \n \n \n-\n \n \n \n793,721\n \n \n \n-\n \n\nForeign government bonds\n\n \n \n-\n \n \n \n1,315,058\n \n \n \n-\n \n \n \n1,315,058\n \n \n \n4,612\n \n \n \n-\n \n \n \n1,310,307\n \n \n \n139\n \n\nForeign corporate bonds\n\n \n \n-\n \n \n \n353,862\n \n \n \n61,068\n \n \n \n414,930\n \n \n \n29,447\n \n \n \n-\n \n \n \n385,483\n \n \n \n-\n \n\nSecuritized products\n\n \n \n-\n \n \n \n59,702\n \n \n \n48,878\n \n \n \n108,580\n \n \n \n-\n \n \n \n-\n \n \n \n108,580\n \n \n \n-\n \n\nFinancial assets designated to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity securities\n\n \n \n86,339\n \n \n \n-\n \n \n \n302,488\n \n \n \n388,827\n \n \n \n-\n \n \n \n-\n \n \n \n5,880\n \n \n \n382,947\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal assets\n\n \n \n4,341,247\n \n \n \n10,907,662\n \n \n \n612,037\n \n \n \n15,860,946\n \n \n \n134,589\n \n \n \n19,767\n \n \n \n14,749,121\n \n \n \n957,469\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\nPresentation in the\n\nconsolidated statements\n\nof financial position\n\n \n \n \n \n\n \n \n\nLevel 1\n\n \n \n\nLevel 2\n\n \n \n\nLevel 3\n\n \n \n\nTotal\n\n \n \n\nOther\n\nfinancial\n\nliabilities\n\n(Current)\n\n \n \n\nOther\n\nfinancial\n\nliabilities\n\n(Non-current)\n\n \n\nLiabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\nDerivative liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest rate contracts\n\n \n \n-\n \n \n \n15,835\n \n \n \n-\n \n \n \n15,835\n \n \n \n1,016\n \n \n \n14,819\n \n\nForeign exchange contracts\n\n \n \n-\n \n \n \n15,778\n \n \n \n-\n \n \n \n15,778\n \n \n \n15,778\n \n \n \n-\n \n\nEquity contracts\n\n \n \n514\n \n \n \n-\n \n \n \n118,606\n \n \n \n119,120\n \n \n \n514\n \n \n \n118,606\n \n\nBond contracts\n\n \n \n3,793\n \n \n \n-\n \n \n \n-\n \n \n \n3,793\n \n \n \n3,793\n \n \n \n-\n \n\nContingent consideration\n\n \n \n-\n \n \n \n-\n \n \n \n25,785\n \n \n \n25,785\n \n \n \n11,594\n \n \n \n14,191\n \n\nFinancial liabilities designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\nRedeemable noncontrolling interests\n\n \n \n-\n \n \n \n-\n \n \n \n52,963\n \n \n \n52,963\n \n \n \n10,912\n \n \n \n42,051\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal liabilities\n\n \n\n \n\n4,307\n\n \n\n \n\n \n\n31,613\n\n \n\n \n\n \n\n197,354\n\n \n\n \n\n \n\n233,274\n\n \n\n \n\n \n\n43,607\n\n \n\n \n\n \n\n189,667\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\nF-3\n\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPresentation in the\n\nconsolidated statements\n\nof financial position\n\n \n\n \n\n \n\nLevel 1\n\n \n\n \n\nLevel 2\n\n \n\n \n\nLevel 3\n\n \n\n \n\nTotal\n\n \n\n \n\nOther\n\nfinancial\n\nassets\n\n(Current)\n\n \n\n \n\nOther\n\nfinancial\n\nassets\n\n(Non-current)\n\n \n\nAssets:\n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial assets required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese corporate bonds\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n170\n\n \n\n \n\n \n\n170\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n170\n\n \n\nForeign corporate bonds\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,601\n\n \n\n \n\n \n\n6,601\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,601\n\n \n\nInvestment funds\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n16,646\n\n \n\n \n\n \n\n16,646\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n16,646\n\n \n\nEquity securities\n\n \n\n \n\n446,932\n\n \n\n \n\n \n\n8,547\n\n \n\n \n\n \n\n15,029\n\n \n\n \n\n \n\n470,508\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n470,508\n\n \n\nDerivative assets\n\n \n\n \n\n \n\n \n\n \n\n \n\nInterest rate contracts\n\n \n\n \n\n-\n\n \n\n \n\n \n\n20,982\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n20,982\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n20,982\n\n \n\nForeign exchange contracts\n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,972\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,972\n\n \n\n \n\n \n\n6,972\n\n \n\n \n\n \n\n-\n\n \n\nFinancial assets required to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign government bonds\n\n \n\n \n\n-\n\n \n\n \n\n \n\n158\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n158\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n158\n\n \n\nFinancial assets designated to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity securities\n\n \n\n \n\n148,537\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n318,952\n\n \n\n \n\n \n\n467,489\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n467,489\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal assets\n\n \n\n \n\n595,469\n\n \n\n \n\n \n\n36,659\n\n \n\n \n\n \n\n357,398\n\n \n\n \n\n \n\n989,526\n\n \n\n \n\n \n\n  6,972\n\n \n\n \n\n \n\n982,554\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPresentation in the\n\nconsolidated statements\n\nof financial position\n\n \n\n \n\n \n\nLevel 1\n\n \n\n \n\nLevel 2\n\n \n\n \n\nLevel 3\n\n \n\n \n\nTotal\n\n \n\n \n\nOther\n\nfinancial\n\nliabilities\n\n(Current)\n\n \n\n \n\nOther\n\nfinancial\n\nliabilities\n\n(Non-current)\n\n \n\nLiabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\nDerivative liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign exchange contracts\n\n \n \n-\n \n \n \n14,553\n \n \n \n-\n \n \n \n14,553\n \n \n \n14,553\n \n \n \n-\n \n\nEquity contracts\n\n \n \n-\n \n \n \n-\n \n \n \n55,663\n \n \n \n55,663\n \n \n \n55,663\n \n \n \n-\n \n\nContingent consideration\n\n \n \n-\n \n \n \n-\n \n \n \n16,549\n \n \n \n16,549\n \n \n \n9,906\n \n \n \n6,643\n \n\nFinancial liabilities designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\nRedeemable noncontrolling interests\n\n \n \n-\n \n \n \n-\n \n \n \n78,568\n \n \n \n78,568\n \n \n \n35,663\n \n \n \n42,905\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal liabilities\n\n \n \n      -\n \n \n \n14,553\n \n \n \n150,780\n \n \n \n165,333\n \n \n \n115,785\n \n \n \n 49,548\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCash and cash equivalents are excluded from the tables above. Refer to Note 27.\n\nTransfers of debt securities from Level 2 to Level 1 were\n2,557 \nmillion yen for the fiscal year ended\n\nMarch 31, 2025, as\n \n\nquoted prices in active markets for certain debt securities became available. There were no transfers of debt securities from Level 2 to Level 1 for the fiscal year ended March 31, 2026. Transfers of debt securities from Level 1 to Level 2 were\n\n2,081\n \n\nmillion yen for the fiscal year ended March 31, 2025\n,\nas quoted prices in active markets for certain debt securities became unavailable. There were no transfers of debt securities from Level 1 to Level 2 for the fiscal year ended March 31, 2026.\n\nEquity securities which are classified as financial assets required to be measured at FVPL mainly include foreign equity securities, and equity securities which are classified as financial assets designated to be measured at FVOCI mainly consist of\n\nJapanese equity securities. Transfers of equity securities from Level 2 to Level 1 were\n 1,480 \nmillion yen for the fiscal year ended March 31, 2025\n,\nas quoted prices in active markets for certain equity securities became available. There were no transfers of equity securities from Level 2 to Level 1 for the fiscal year ended March 31, 2026.\n\nThe amount of transfers is calculated by assuming that transfers between levels occurred as of April 1 if transfers between levels occur during the period from April 1 through September 30, or as of October 1 if they occur during the period from October 1 through March 31 of the following year.\n\n \n\nF-3\n\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe valuation techniques used to measure the fair value of assets and liabilities classified as Level 3, significant unobservable inputs that have a material impact on fair value measurement, and their respective ranges, are as follows:\n\n \n\n \n \n\nValuation\n\ntechnique(s)\n\n \n \n \n \n \n\nSignificant\nunobservable\ninputs\n\n \n \n \n \n  \n\nRange\n\n \n\n \n  \n\nMarch 31, 2025\n\n \n \n \n \n  \n\nMarch 31, 2026\n\n \n\nFinancial assets required to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n  \n\n \n\n  \n\nDebt securities\n\n \n\n \n\n \n\n \n\n  \n\n \n\n  \n\nJapanese corporate bonds\n\n \n \nDiscounted cash flow\n \n \n\n \n \nCredit spread\n \n \n\n  \n \n\n53bp-71bp\n\n \n \n\n  \n \n-\n \n\nSecuritized products\n\n  \n \n\n80bp-140bp\n\n \n  \n \n-\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n  \n\n \n\n  \n\nDerivative liabilities\n\n \n\n \n\n \n\n \n\n  \n\n \n\n  \n\nEquity contracts\n\n \n \n\nOption pricing\n\n(Black-Scholes)\n\n \n \n\n \n\n \n \nVolatility\n \n \n\n  \n \n\n47.7%-57.0%\n\n \n \n\n  \n \n\n51.1%-67.7%\n\n \n\n* bp = basis point\n\nFor assets classified as Level 3, there are no significant unobservable inputs that have a material impact on fair value measurement as of March 31, 2026.\n\nThe decrease (increase) in fair value of the debt securities is the result of a rise (decline) of credit spreads.\n\nFor the above assets and liabilities classified as Level 3, the fair value would not change significantly, if one or more of the significant unobservable inputs were changed to reflect reasonably possible alternative assumptions.\n\n \n\nF-3\n\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe changes in fair value of Level 3 assets and liabilities for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFiscal year ended March 31, 2025\n\n \n\n \n \n \n \n \n \n \n \n\nTotal gains (losses)*¹\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \n\nBeginning\n\nbalance\n\n \n \n \n \n \n\nNet\n\nincome*²\n\n \n \n \n \n \n\nOther\n\ncomprehensive\n\nincome*³\n\n \n \n \n \n \n\nPurchases\n\n \n \n \n \n \n\nSales and\n\nsettlements\n\n \n \n \n \n \n\nTransfers to\nLevel 3\n\n \n \n \n \n \n\nTransfers\nout of\nLevel 3\n*4\n\n \n \n \n \n \n\nOther\n*5\n\n \n \n \n \n \n\nEnding\nbalance\n\n \n\nAssets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial assets required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese corporate bonds\n\n \n \n20\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n33\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(20\n) \n \n\n \n \n33\n \n\nForeign corporate bonds\n\n \n \n2,933\n \n \n\n \n \n(53\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(31\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n2,849\n \n\nInvestment funds\n\n \n \n67,355\n \n \n\n \n \n2,580\n \n \n\n \n \n(94\n) \n \n\n \n \n35,176\n \n \n\n \n \n(37,968\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(186\n) \n \n\n \n \n66,863\n \n\nEquity securities\n\n \n \n9,434\n \n \n\n \n \n(1,725\n) \n \n\n \n \n(1\n) \n \n\n \n \n2,391\n \n \n\n \n \n(421\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n9,678\n \n\nDerivative assets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity contracts\n\n \n \n2,379\n \n \n\n \n \n-\n \n \n\n \n \n(33\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n2,346\n \n\nFinancial assets designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign corporate bonds\n\n \n \n5,923\n \n \n\n \n \n119\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n6,042\n \n\nFinancial assets required to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese corporate bonds\n\n \n \n138,848\n \n \n\n \n \n9\n \n \n\n \n \n(27,065\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n111,792\n \n\nForeign corporate bonds\n\n \n \n34,757\n \n \n\n \n \n(939\n) \n \n\n \n \n(452\n) \n \n\n \n \n48,023\n \n \n\n \n \n(17,628\n) \n \n\n \n \n-\n \n \n\n \n \n(2,693\n) \n \n\n \n \n-\n \n \n\n \n \n61,068\n \n\nSecuritized products\n\n \n \n22,008\n \n \n\n \n \n(1,605\n) \n \n\n \n \n37\n \n \n\n \n \n40,906\n \n \n\n \n \n(12,468\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n48,878\n \n\nFinancial assets designated to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity securities\n\n \n \n249,181\n \n \n\n \n \n-\n \n \n\n \n \n(16,430\n) \n \n\n \n \n7,200\n \n \n\n \n \n(2,185\n) \n \n\n \n \n-\n \n \n\n \n \n(1,699\n) \n \n\n \n \n66,421\n \n \n\n \n \n302,488\n \n\nLiabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDerivative liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity contracts\n\n \n \n-\n \n \n\n \n \n121,082\n \n \n\n \n \n(2,476\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n118,606\n \n\nContingent consideration\n\n \n \n50,343\n \n \n\n \n \n(3,013\n) \n \n\n \n \n(260\n) \n \n\n \n \n3,101\n \n \n\n \n \n(24,221\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(165\n) \n \n\n \n \n25,785\n \n\nFinancial liabilities designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nRedeemable noncontrolling interests\n\n \n \n54,028\n \n \n\n \n \n(610\n) \n \n\n \n \n(348\n) \n \n\n \n \n6,199\n \n \n\n \n \n(6,306\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n52,963\n \n\n \n\nF-3\n\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFiscal year ended March 31, 2026\n\n \n\n \n \n \n \n \n \n \n \n\nTotal gains (losses)\n*1\n\n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n \n\nBeginning\n\nbalance\n\n \n \n \n \n \n\nNet\n\nincome\n*2\n\n \n \n \n \n \n\nOther\n\ncomprehensive\n\nincome\n*\n\n3\n\n \n \n \n \n \n\nPurchases\n\n \n \n \n \n \n\nSales and\n\nsettlements\n\n \n \n \n \n \n\nTransfers to\nLevel 3\n\n \n \n \n \n \n\nTransfers\n\nout of\nLevel 3\n*4\n\n \n \n \n \n \n\nOther\n*6\n\n \n \n \n \n \n\nEnding\nbalance\n\n \n\nAssets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial assets required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese corporate bonds\n\n \n \n33\n \n \n\n \n \n\n(9\n\n)\n \n \n\n \n \n-\n \n \n\n \n \n26\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n120\n \n \n\n \n \n170\n \n\nForeign corporate bonds\n\n \n \n2,849\n \n \n\n \n \n201\n \n \n\n \n \n-\n \n \n\n \n \n\n3,551\n\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n6,601\n \n\nInvestment funds\n\n \n \n66,863\n \n \n\n \n \n(2,296\n)\n \n\n \n \n399\n \n \n\n \n \n3,873\n \n \n\n \n \n(2,302\n)\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(49,891\n)\n \n\n \n \n16,646\n \n\nEquity securities\n\n \n \n9,678\n \n \n\n \n \n401\n \n \n\n \n \n1\n \n \n\n \n \n7,067\n \n \n\n \n \n(160\n)\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n\n(1,958\n\n)\n \n \n\n \n \n15,029\n \n\nDerivative assets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity contracts\n\n \n \n2,346\n \n \n\n \n \n\n(2,119\n\n)\n \n \n\n \n \n20\n \n \n\n \n \n-\n \n \n\n \n \n\n(247\n\n)\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\nFinancial assets designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign corporate bonds\n\n \n \n6,042\n \n \n\n \n \n74\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n\n(1,808\n\n)\n \n \n\n \n \n\n(4,308\n\n)\n \n \n\n \n \n-\n \n\nFinancial assets required to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nJapanese corporate bonds\n\n \n \n111,792\n \n \n\n \n \n4\n \n \n\n \n \n(17,509\n)\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n\n(94,287\n\n)\n \n \n\n \n \n-\n \n\nForeign corporate bonds\n\n \n \n61,068\n \n \n\n \n \n727\n \n \n\n \n \n70\n \n \n\n \n \n29,629\n \n \n\n \n \n(16,921\n)\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n\n(74,573\n\n)\n \n \n\n \n \n-\n \n\nSecuritized products\n\n \n \n48,878\n \n \n\n \n \n154\n \n \n\n \n \n19\n \n \n\n \n \n31,207\n \n \n\n \n \n(4,816\n)\n \n\n \n \n-\n \n \n\n \n \n\n(12,650\n\n)\n \n \n\n \n \n\n(62,792\n\n)\n \n \n\n \n \n-\n \n\nFinancial assets designated to be measured at FVOCI\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity securities\n\n \n \n302,488\n \n \n\n \n \n-\n \n \n\n \n \n(11,154\n)\n \n\n \n \n31,126\n \n \n\n \n \n(3,005\n)\n \n\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(503\n)\n \n\n \n \n318,952\n \n\nLiabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDerivative liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity contracts\n\n \n \n\n118,606\n\n \n \n\n \n \n(67,174\n)\n \n\n \n \n4,231\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n55,663\n \n\nContingent consideration\n\n \n \n25,785\n \n \n\n \n \n(873\n)\n \n\n \n\n \n \n1,480\n \n \n\n \n \n1,271\n \n \n\n \n \n(10,933\n)\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(181\n)\n \n\n \n \n16,549\n \n\nFinancial liabilities designated to be measured at FVPL\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nRedeemable noncontrolling interests\n\n \n \n52,963\n \n \n\n \n \n2,865\n \n \n\n \n \n3,472\n \n \n\n \n \n20,360\n \n \n\n \n \n(1,092\n)\n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n78,568\n \n\n \n\n*1\n\nFor liability items, gains are presented as negative and losses are presented as positive.\n\n \n\n*2\n\nGains (losses) recognized in net income are included in other operating (income) expense, net, financial income, financial expenses and net income (loss) from discontinued operations in the consolidated statements of income. In connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, income and loss from the Financial Services business is included in net income (loss) from discontinued operations, which was previously included in financial services revenue in the consolidated statements of income.\n\n \n\n*3\n\nGains (losses) recognized in other comprehensive income are included in changes in equity instruments measured at fair value through other comprehensive income, exchange differences on translating foreign operations and other comprehensive income from discontinued operations in the consolidated statements of comprehensive income. In connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, other comprehensive income from the Financial Services business, which was previously included in changes in equity instruments measured at fair value through other comprehensive income and changes in debt instruments measured at fair value through other comprehensive income in the consolidated statements of comprehensive income, is included in other comprehensive income from discontinued operations.\n\n \n\n*4\n\nCertain financial assets were transferred from Level 3 because observable market data became available.\n\n \n\n*5\n\nThis column primarily includes the amount of equity securities designated to be measured at fair value through other comprehensive income due to a change in the scope of consolidation.\n\n \n\n*6\n\nThis column primarily includes the amount excluded from consolidation as a result of the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\nF-\n\n40\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe changes in unrealized gains (losses) recognized in net income for Level 3 assets and liabilities held as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n 2025 \n\n \n \n \n \n \n\n 2026 \n\n \n\nAssets:\n\n \n\n \n\n \n\nFinancial assets required to be measured at FVPL\n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n \n \n \n \n \n \n \n \n \n\nJapanese corporate bonds\n\n \n \n-\n \n \n\n \n \n(9\n)\n\nForeign corporate bonds\n\n \n \n(39\n)\n \n\n \n \n201\n \n\nInvestment funds\n\n \n \n(1,801\n)\n \n\n \n \n(2,067\n)\n\nEquity securities\n\n \n \n(840\n) \n \n \n \n \n \n \n319\n \n\nFinancial assets designated to be measured at FVPL\n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\nForeign corporate bonds\n\n \n \n119\n \n \n\n \n \n-\n \n\nFinancial assets required to be measured at FVOCI\n\n \n\n \n\n \n\nDebt securities\n\n \n\n \n\n \n\nJapanese corporate bonds\n\n \n \n9\n \n \n\n \n \n-\n \n\nForeign corporate bonds\n\n \n \n(939\n) \n \n\n \n \n-\n \n\nSecuritized products\n\n \n \n(1,610\n) \n \n\n \n \n-\n \n\nLiabilities:\n\n \n\n \n\n \n\nFinancial liabilities required to be measured at FVPL\n\n \n\n \n\n \n\nDerivative liabilities\n\n \n\n \n\n \n\nEquity contracts\n\n \n \n(121,082\n) \n \n\n \n \n67,174\n \n\nContingent consideration\n\n \n \n(1,223\n) \n \n\n \n \n(524\n)\n\nFinancial liabilities designated to be measured at FVPL\n\n \n\n \n\n \n\nRedeemable noncontrolling interests\n\n \n \n600\n \n \n\n \n \n(2,865\n)\n\nUnrealized gains (losses) recognized in net income are included in other operating (income) expense, net, financial income, financial expenses and net income (loss) from discontinued operations in the consolidated statements of income. In connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, income and loss from the Financial Services business is included in net income (loss) from discontinued operations, which was previously included in financial services revenue in the consolidated statements of income.\n\nSony generally elects to designate investments in equity instruments held to promote its businesses and to maintain and enhance the business relationship as financial assets measured at fair value through other comprehensive income based on the purposes of holding the investments.\n\nEquity instruments measured at fair value through other comprehensive income as of March 31, 2025 and 2026 comprise the following:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n 2025 \n\n \n \n \n \n  \n\n 2026 \n\n \n\nMarketable equity instruments\n\n  \n \n86,339\n \n \n\n  \n \n148,537\n \n\nNon-marketable\nequity instruments\n\n  \n \n302,488\n \n \n\n  \n \n318,952\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n388,827\n \n \n\n  \n \n467,489\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nSignificant marketable equity instruments measured at fair value through other comprehensive income as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n 2025 \n\n \n \n \n \n  \n\n 2026 \n\n \n\nKADOKAWA Corporation\n\n  \n \n52,951\n \n \n\n  \n \n62,200\n \n\nANYCOLOR Inc.\n\n  \n \n10,815\n \n \n\n  \n \n9,706\n \n\nBandai Namco Holdings Inc.\n\n  \n \n-\n \n \n\n  \n \n61,872\n \n\n \n\nF-4\n\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe balances of the\nnon-marketable\ninstruments measured at fair value through other comprehensive income by major sector categories as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31\n\n \n\n \n \n\n  2025  \n\n \n \n \n \n \n\n  2026  \n\n \n\nEntertainment\n*1\n\n \n \n181,000\n \n \n\n \n \n171,267\n \n\nManufacturing\n*2\n\n \n \n91,099\n \n \n\n \n \n114,305\n \n\nInformation technology, Communication and Service\n*3\n\n \n \n27,987\n \n \n\n \n \n29,810\n \n\n \n\n*1\n\nMajor investments included Epic Games, Inc.\n\n \n\n*2\n\nMajor investments included Japan Advanced Semiconductor Manufacturing, Inc. and Nichia Corporation as of March 31, 2025.\n\n \n\n \n\nMajor investments included Japan Advanced Semiconductor Manufacturing, Inc., Rapidus Corporation and Nichia Corporation as of March 31, 2026.\n\n \n\n*3\n\nMajor investments included Semiconductor Energy Laboratory Co., Ltd.\n\nIn order to enhance the efficiency of using assets held effectively, Sony derecognizes equity instruments measured at fair value through other comprehensive income upon the sale of the investment. Information relating to investments derecognized during the fiscal years ended March 31, 2025 and 2026 is as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n  2025  \n\n \n \n \n \n \n\n  2026  \n\n \n\nFair value at derecognition\n\n \n \n32,275\n \n \n\n \n \n10,073\n \n\nCumulative amount recognized in other comprehensive income, net of tax*\n\n \n \n(29,508\n) \n \n\n \n \n(3,892\n)\n\nDividend received\n\n \n \n-\n \n \n\n \n \n-\n \n\n \n\n*\n\nThe cumulative amount recognized in other comprehensive income, net of tax, was transferred to retained earnings upon derecognition of the equity instruments.\n\n \n\nF-4\n\n2\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(3)\n\nFinancial instruments measured at amortized cost\n\nThe fair values by fair value hierarchy level of certain financial instruments that are measured at amortized cost as of March 31, 2025 and 2026 are summarized as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31, 2025\n\n \n\n \n\n  \n\nFair value\n\n \n\n \n\n \n\n \n\n  \n\nCarrying\namount\n\n \n\n \n\n  \n\nLevel 1\n\n \n\n \n\n \n\n \n\n  \n\nLevel 2\n\n \n\n \n\n \n\n \n\n  \n\nLevel 3\n\n \n\n \n\n \n\n \n\n  \n\nTotal\n\n \n\n \n\n \n\n \n\n  \n\nTotal\n\n \n\nAssets:\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nDebt securities\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nJapanese local government bonds\n\n \n \n-\n \n \n\n \n \n11,696\n \n \n\n \n \n-\n \n \n\n \n \n11,696\n \n \n\n  \n \n11,626\n \n\nJapanese corporate bonds\n\n \n\n-\n\n \n\n \n \n24,273\n \n \n\n \n \n-\n \n \n\n \n \n24,273\n \n \n\n  \n \n24,916\n \n\nForeign corporate bonds\n\n \n \n-\n \n \n\n \n \n937\n \n \n\n \n \n-\n \n \n\n \n \n937\n \n \n\n  \n \n935\n \n\nSecuritized products\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n439,132\n \n \n\n \n \n439,132\n \n \n\n  \n \n439,281\n \n\nOther\n\n \n \n-\n \n \n\n \n \n29,820\n \n \n\n \n \n14,364\n \n \n\n \n \n44,184\n \n \n\n  \n \n44,296\n \n\nHousing loans in the banking business\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n3,709,148\n \n \n\n \n \n3,709,148\n \n \n\n  \n \n3,763,261\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal assets\n\n \n \n-\n \n \n\n \n \n66,726\n \n \n\n \n \n4,162,644\n \n \n\n \n \n4,229,370\n \n \n\n  \n \n4,284,315\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nLiabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\nLong-term debt including the current portion\n\n \n \n-\n \n \n\n \n \n1,621,264\n \n \n\n \n \n101,632\n \n \n\n \n \n1,722,896\n \n \n\n  \n \n1,754,817\n \n\nInvestment contract liabilities\n\n \n \n-\n \n \n\n \n \n60,558\n \n \n\n \n \n-\n \n \n\n \n \n60,558\n \n \n\n  \n \n62,772\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal liabilities\n\n \n \n       -\n \n \n\n \n \n1,681,822\n \n \n\n \n \n101,632\n \n \n\n \n \n1,783,454\n \n \n\n  \n \n1,817,589\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31, 2026\n\n \n\n \n\n  \n\nFair value\n\n \n\n \n\n \n\n \n\n  \n\nCarrying\namount\n\n \n\n \n\n  \n\nLevel 1\n\n \n\n \n\n \n\n \n\n  \n\nLevel 2\n\n \n\n \n\n \n\n \n\n  \n\nLevel 3\n\n \n\n \n\n \n\n \n\n  \n\nTotal\n\n \n\n \n\n \n\n \n\n  \n\nTotal\n\n \n\nLiabilities:\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nLong-term debt including the current portion\n\n  \n\n \n\n-\n\n \n\n \n\n  \n\n \n\n  962,660\n\n \n\n \n\n  \n\n \n\n    1,874\n\n \n\n \n\n  \n\n \n\n  964,534\n\n \n\n \n\n  \n\n \n\n  990,803\n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nTotal liabilities\n\n  \n\n \n\n       -\n\n \n\n \n\n  \n\n \n\n962,660\n\n \n\n \n\n  \n\n \n\n1,874\n\n \n\n \n\n  \n\n \n\n964,534\n\n \n\n \n\n  \n\n \n\n990,803\n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\nThe table above does not include financial instruments measured at amortized cost whose carrying amounts approximate their fair values mainly due to their short-term nature.\n\nAs a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, financial assets that are measured at amortized cost are presented only as of March 31, 2025.\n\nThe fair values of long-term debt, including the current portion classified as Level 2, are estimated mainly based on discounted future cash flows using Sony’s current rates for similar liabilities.\n\nAs of March 31, 2025, the fair values of investment contract liabilities classified as Level 2 were determined by using the present value of expected cash flows based on risk-free interest rate yield curves adjusted for items such as credit risk.\n\nAs of March 31, 2025, financial instruments classified as Level 3 mainly included housing loans in the banking business, securitized products and certain bonds issued by Sony. In determining the fair value of such financial instruments, Sony used the present value of expected cash flows based on risk-free interest rate yield curves adjusted for items such as credit risk.\n\n \n\nF-4\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n6.\n\nFinancial risk management\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, each risk related to the Financial Services business is presented only as of March 31, 2025.\n\n \n\n(1)\n\nCapital risk\n\nSony refers to Return on Equity (“ROE”) as an indicator for capital risk management in the light of ensuring financial soundness.\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n 2025 \n\n \n  \n \n \n  \n\n 2026 \n\n \n\nROE*\n\n  \n \n13.5\n% \n  \n\n  \n \n12.6\n% \n\n* ROE is calculated using equity attributable to Sony Group Corporation’s stockholders and net income from continuing operations attributable to Sony Group Corporation’s stockholders, and the ROE for the fiscal year ended March 31, 2025 has also been represented accordingly.\n\n(As of March 31, 2025)\n\nSony manages capital separately for the Financial Services business and the Sony Group without the Financial Services business because certain subsidiaries in the Financial Services business are subject to the below restrictions. Sony also refers to the ratio of stockholders’ equity to total assets of the Sony Group without the Financial Services business to ensure financial soundness.\n\nIn the Financial Services business, Sony is required to maintain the soundness indicators at a certain level or higher based on the Insurance Business Act and the Banking Act of Japan. Material requirements which Sony is subject to are as follows:\n\nInsurance business: Solvency margin ratio\n\nThe life insurance subsidiary and the\nnon-life\ninsurance subsidiary have maintained a solvency margin ratio required by the Japanese domestic criteria.\n\nBanking business: Capital adequacy ratio\n\nThe banking subsidiary has maintained a capital adequacy ratio required by the Japanese domestic criteria.\n\nAccordingly, lending and borrowing between subsidiaries in the Financial Services business and the other companies within Sony Group is strictly limited. The carrying amount of total assets of SFGI as of March 31, 2025 is\n\n21,072,828\n \n\nmillion yen. The carrying amount of total liabilities of SFGI as of March 31, 2025 is\n\n19,999,916\n million yen.\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there are no balances of total assets and liabilities related to the Financial Services business as of March 31, 2026.\n\n \n\n(2)\n\nInterest rate risk\n\nFor interest rate risk inherent in the insurance business, which is included in the Financial Services business, refer to Note 13. For interest rate risk inherent in the banking business, which is included in the Financial Services business, refer to (7) Market risks for the banking business.\n\nRisk management policy and exposure\n\nInterest rate risk is the risk the fair value of a financial instrument or future cash flows of the financial instrument will fluctuate because of changes in market interest rates.\n\nContinuing operations are exposed to interest rate risk that is mainly related to its liabilities such as short-term borrowings and long-term debt as well as bonds. The amount of interest will be affected by changes in market interest rates; therefore, Sony is exposed to the interest rate risk that the future cash outflows for interest payments will fluctuate.\n\nSony raises funds by issuing fixed-rate bonds in order to avoid an increase in future interest payments that is mainly resulting from an increase in interest rates.\n\nAlso, Sony utilizes interest rate swap agreements to reduce funding costs, to diversify sources of funding, and to hedge the downside risk on borrowings and debt securities resulting from unfavorable fluctuations of interest rates and currency exchange rates, and from changes in the fair value of financial instruments. Therefore, the interest rate risk associated with cash flows of continuing operations is not significant.\n\n \n\nF-4\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(3)\n\nPrice risk\n\nFor price risk inherent in the insurance business, which is included in the Financial Services business, refer to Note 13. For price risk inherent in the banking business, which is included in the Financial Services business, refer to (7) Market risks for the banking business.\n\nRisk management policy and exposure\n\nSony is exposed to securities price risk inherent in holding of equities in other entities in Japan and overseas countries. Sony periodically assesses fair values of equity instruments and the financial conditions of the issuers of such equity instruments, and reviews its portfolio on a regular basis.\n\nPrice sensitivity analysis\n\nThe table below shows the effects on income before income taxes and other comprehensive income (before considering the tax effects) as of March 31, 2025 and 2026 if market prices of marketable equity instruments (e.g., stocks) had decreased by 10%.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n \n \n \n  \n\n2026\n\n \n\nIncome before income taxes\n\n  \n \n(47,269\n) \n \n\n  \n \n(44,693\n)\n\nOther comprehensive income (before considering the tax effects)\n\n  \n \n(8,114\n) \n \n\n  \n \n(14,854\n)\n\n \n\n(4)\n\nLiquidity risk\n\nFor liquidity risk inherent in the insurance business, which is included in the Financial Services business, refer to Note 13. This section does not include information regarding the insurance business other than maturity analysis for financial liabilities.\n\nRisk management policy\n\nThe description below covers basic financial policy and figures for Sony’s consolidated operations except for the Financial Services business and certain subsidiaries, which secure liquidity on their own. Furthermore, the banking business in the Financial Services business is described separately at the end of this section.\n\nLiquidity Management and Market Access\n\nAn important financial objective of Sony is to maintain the strength of its financial condition, while securing adequate liquidity for business activities. Sony defines its liquidity sources as the amount of cash and cash equivalents (“cash balance”) (excluding restrictions on capital transfers mainly due to national regulations) and the unused amount of committed lines of credit. Funding requirements that arise from maintaining liquidity are principally covered by cash flow from operating and investing activities (including asset sales) and by the available cash balance; however, Sony also raises funds as needed from financial and capital markets through means such as corporate bonds, commercial paper (“CP”) and bank loans. Sony Group Corporation, Sony Global Treasury Services Plc (“SGTS”), a finance subsidiary in the U.K. and Sony Capital Corporation (“SCC”), a finance subsidiary in the U.S., maintain CP programs with access to the Japanese, U.S. and European CP markets. The borrowing limits under these CP programs, translated into yen, were 1,299.3 billion yen in total for Sony Group Corporation, SGTS and SCC as of March 31, 2026. There were no amounts outstanding under the CP programs as of March 31, 2026. If disruption and volatility occur in financial and capital markets and Sony becomes unable to raise sufficient funds from these sources, Sony may also draw down funds from contractually committed lines of credit from various financial institutions. Sony has a total, translated into yen, of 789.6 billion yen in unused committed lines of credit, as of March 31, 2026. Details of those committed lines of credit are: a 350.0 billion yen committed line of credit contracted with a syndicate of Japanese banks, a 1.7 billion U.S. dollar multi-currency committed line of credit also contracted with a syndicate of Japanese banks and a 1.05 billion U.S. dollar multi-currency committed line of credit contracted with a syndicate of foreign banks. Sony currently believes that it can sustain sufficient liquidity through access to committed lines of credit with financial institutions, together with its available cash balance, even in the event that financial and capital markets become illiquid. Sony considers one of management’s top priorities to be the maintenance of stable and appropriate credit ratings in order to ensure financial flexibility for liquidity and capital management and continued adequate access to sufficient funding resources in the financial and capital markets. However, in the event of a downgrade in Sony’s credit ratings, there are no financial covenants in any of Sony’s material financial agreements with financial institutions that would cause an acceleration of the obligation. Even though the cost of borrowing for some committed lines of credit could change according to Sony’s credit ratings, there are no financial covenants that would cause any impairment on the ability to draw down on unused facilities.\n\n \n\nF-4\n\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nCash Management\n\nSony manages its global cash management activities primarily through Sony Group Corporation in Japan, SCC in the U.S. and SGTS in other regions. The excess or shortage of cash at most of Sony’s subsidiaries is invested or funded by Sony Group Corporation, SGTS and SCC on a net basis, although Sony recognizes that fund transfers are limited in certain countries and geographic areas due to restrictions on capital transactions. In order to pursue more efficient cash management, cash surpluses among Sony’s subsidiaries are deposited with Sony Group Corporation, SGTS and SCC, and cash shortfalls among subsidiaries are covered by loans through Sony Group Corporation, SGTS and SCC, so that Sony can make use of excess cash balances and reduce third-party borrowings. Where local restrictions prevent an efficient intercompany transfer of funds, Sony’s intent is that cash balances remain outside of Sony Group Corporation, SGTS and SCC and that Sony meets its liquidity needs through ongoing cash flows, external borrowings, or both. Sony does not expect restrictions of capital transactions on amounts held outside of Japan to have a material effect on Sony’s overall liquidity, financial condition or results of operations.\n\nBanking business in the Financial Services business\n\n(As of March 31, 2025)\n\nIn the banking business in the Financial Services business, by formulating and conforming with liquidity risk management policies, Sony manages its liquidity risks. Sony defines liquidity risk as cash flow risk and market liquidity risk. Cash flow risk is the risk associated with losses due to Sony’s inability to make cash payments because of a failure to maintain sufficient cash reserves at settlement, as well as risks associated with losses if Sony is forced to raise funds under unfavorable conditions in order to fulfill cash payment obligations. The levels of cash flow risks are classified into phases based on the degree of pressure, and methods of risk management and reporting are set out for each phase, while guidelines are formulated and reviewed as necessary. Market liquidity risk is the risk associated with losses due to Sony’s inability to conduct market transactions, in particular due to an inability to unwind its market position at a given time, or due to Sony being forced to complete transactions under unfavorable market conditions, due to market turmoil or other factors. To manage market liquidity risk, Sony works to understand market liquidity conditions that pertain to the types of products it handles. Sony formulates and revises guidelines on a\n\nproduct-by-product\n\nbasis, as necessary. The aforementioned liquidity risk management is carried out by the risk management division. The division periodically reports risk management conditions to the banking subsidiary’s Board of Directors and Executive Committee. In addition, the banking subsidiary’s internal audit division conducts audits of the risk management conditions.\n\nMaturity analysis\n\nThe following table summarizes Sony’s financial liabilities as of March 31, 2025 and 2026.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 2025\n\n \n\n \n \n\nCarrying\n\namount\n\n \n \n \n \n \n\nTotal\n\n \n \n \n \n \n\nWithin\n\n1 year\n\n \n \n \n \n \n\n1 year to\n\n2 years\n\n \n \n \n \n \n\n2 years to\n\n3 years\n\n \n \n \n \n \n\n3 years to\n\n4 years\n\n \n \n \n \n \n\n4 years to\n\n5 years\n\n \n \n \n \n \n\n5+ years\n\n \n\nDeposits from customers in the banking business\n*1,2\n\n \n \n4,243,962\n \n \n\n \n \n4,281,915\n \n \n\n \n \n4,006,600\n \n \n\n \n \n96,834\n \n \n\n \n \n11,141\n \n \n\n \n \n2,692\n \n \n\n \n \n10,596\n \n \n\n \n \n154,052\n \n\nBonds\n\n \n \n664,390\n \n \n\n \n \n688,245\n \n \n\n \n \n114,299\n \n \n\n \n \n128,972\n \n \n\n \n \n103,488\n \n \n\n \n \n93,160\n \n \n\n \n \n162,927\n \n \n\n \n \n85,399\n \n\nBorrowings\n\n \n \n2,934,386\n \n \n\n \n \n2,971,250\n \n \n\n \n \n1,934,886\n \n \n\n \n \n264,847\n \n \n\n \n \n233,755\n \n \n\n \n \n157,629\n \n \n\n \n \n21,521\n \n \n\n \n \n358,612\n \n\nLoan commitments\n\n \n \n-\n \n \n\n \n \n27,564\n \n \n\n \n \n27,564\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\nDerivative liabilities\n*3\n\n \n \n154,526\n \n \n\n \n \n155,095\n \n \n\n \n \n21,479\n \n \n\n \n \n121,611\n \n \n\n \n \n3,173\n \n \n\n \n \n2,693\n \n \n\n \n \n2,340\n \n \n\n \n \n3,799\n \n\nGuarantee deposits received\n\n \n \n45,017\n \n \n\n \n \n45,017\n \n \n\n \n \n31,866\n \n \n\n \n \n100\n \n \n\n \n \n21\n \n \n\n \n \n7\n \n \n\n \n \n6\n \n \n\n \n \n13,017\n \n\nRedeemable noncontrolling interests\n\n \n \n52,963\n \n \n\n \n \n53,750\n \n \n\n \n \n10,912\n \n \n\n \n \n21,588\n \n \n\n \n \n4,447\n \n \n\n \n \n3,405\n \n \n\n \n \n2,287\n \n \n\n \n \n11,111\n \n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 2025\n\n \n\n \n \n\nCarrying\n\namount\n\n \n \n \n \n\nTotal\n\n \n \n \n \n \n\nWithin\n\n1 year\n\n \n \n \n \n \n\n1 year to\n\n2 years\n\n \n \n \n \n \n\n2 years to\n\n3 years\n\n \n \n \n \n \n\n3 years to\n\n4 years\n\n \n \n \n \n  \n\n4 years to\n\n5 years\n\n \n\nLease liabilities\n\n \n\n599,470\n\n \n\n \n\n \n\n712,098\n\n \n\n \n\n \n\n \n\n115,608\n\n \n\n \n\n \n\n \n\n107,197\n\n \n\n \n\n \n\n \n\n94,233\n\n \n\n \n\n \n\n \n\n75,125\n\n \n\n \n\n  \n\n \n\n67,715\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n \n\n5 years to\n\n6 years\n\n \n \n \n \n \n\n6 years to\n\n7 years\n\n \n \n \n \n \n\n7 years to\n\n8 years\n\n \n \n \n \n \n\n8 years to\n\n9 years\n\n \n \n \n \n \n\n9 years to\n\n10 years\n\n \n \n \n \n  \n\n10+ years\n\n \n\n \n\n \n \n52,376\n \n \n\n \n \n42,763\n \n \n\n \n \n34,114\n \n \n\n \n \n25,860\n \n \n\n \n \n21,529\n \n \n\n  \n \n75,578\n \n\n \n\n*1\n\nDemand deposits are included in the “Within 1 year” category.\n\n \n\n*2\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of deposits from customers in the banking business as of March 31, 2026.\n\n \n\n*3\n\nBreakdown of net settlements and gross settlements in the derivative liabilities are presented below.\n\n \n\nF-4\n\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31, 2025\n\n \n\n \n  \n\nTotal\n\n \n \n \n \n  \n\nWithin\n\n1 year\n\n \n \n \n \n  \n\n1 year to\n\n2 years\n\n \n \n \n \n  \n\n2 years to\n\n3 years\n\n \n \n \n \n  \n\n3 years to\n\n4 years\n\n \n \n \n \n  \n\n4 years to\n\n5 years\n\n \n \n \n \n  \n\n5+ years\n\n \n\nDerivative contracts\n\n  \n \n       \n \n \n\n  \n \n       \n \n \n\n  \n \n        \n \n \n\n  \n \n       \n \n \n\n  \n \n      \n \n \n\n  \n \n      \n \n \n\n  \n \n       \n \n\n-Net settled\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nPaid\n\n  \n \n155,095\n \n \n\n  \n \n21,479\n \n \n\n  \n \n121,611\n \n \n\n  \n \n3,173\n \n \n\n  \n \n2,693\n \n \n\n  \n \n2,340\n \n \n\n  \n \n3,799\n \n\nDerivative contracts\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n-Gross settled\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nReceived\n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n\nPaid\n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\n \n\nCarrying\n\namount\n\n \n\n \n\n \n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n \n\n \n\nWithin\n\n1 year\n\n \n\n \n\n \n\n \n\n \n\n1 year to\n\n2 years\n\n \n\n \n\n \n\n \n\n \n\n2 years to\n\n3 years\n\n \n\n \n\n \n\n \n\n \n\n3 years to\n\n4 years\n\n \n\n \n\n \n\n \n\n \n\n4 years to\n\n5 years\n\n \n\n \n\n \n\n \n\n \n\n5+ years\n\n \n\nBonds\n\n \n \n474,343\n \n \n\n \n \n490,794\n \n \n\n \n \n128,224\n \n \n\n \n \n92,759\n \n \n\n \n \n62,450\n \n \n\n \n \n121,962\n \n \n\n \n \n1,155\n \n \n\n \n \n84,244\n \n\nBorrowings\n\n \n \n567,643\n \n \n\n \n \n638,704\n \n \n\n \n \n109,081\n \n \n\n \n \n69,467\n \n \n\n \n \n160,433\n \n \n\n \n \n16,977\n \n \n\n \n \n151,655\n \n \n\n \n \n131,091\n \n\nDerivative liabilities\n*1\n\n \n \n70,216\n \n \n\n \n \n70,216\n \n \n\n \n \n70,216\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\nGuarantee deposits received\n\n \n \n7,812\n \n \n\n \n \n7,812\n \n \n\n \n \n-\n \n \n\n \n \n309\n \n \n\n \n \n25\n \n \n\n \n \n10\n \n \n\n \n \n10\n \n \n\n \n \n7,458\n \n\nRedeemable noncontrolling interests\n\n \n \n78,568\n \n \n\n \n \n81,194\n \n \n\n \n \n37,485\n \n \n\n \n \n9,995\n \n \n\n \n \n1,974\n \n \n\n \n \n9,344\n \n \n\n \n \n1,640\n \n \n\n \n \n20,756\n\n \n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\n \n\nCarrying\n\namount\n\n \n\n \n\n \n\n \n\nTotal\n\n \n\n \n\n \n\n \n\n \n\nWithin\n\n1 year\n\n \n\n \n\n \n\n \n\n \n\n1 year to\n\n2 years\n\n \n\n \n\n \n\n \n\n \n\n2 years to\n\n3 years\n\n \n\n \n\n \n\n \n\n \n\n3 years to\n\n4 years\n\n \n\n \n\n \n\n \n\n \n\n4 years to\n\n5 years\n\n \n\nLease liabilities\n\n \n\n627,683\n\n \n\n \n\n \n\n722,527\n\n \n\n \n\n \n\n \n\n115,801\n\n \n\n \n\n \n\n \n\n106,678\n\n \n\n \n\n \n\n \n\n97,209\n\n \n\n \n\n \n\n \n\n84,213\n\n \n\n \n\n  \n\n \n\n67,155\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n5 years to\n\n6 years\n\n \n \n \n \n \n\n6 years to\n\n7 years\n\n \n \n \n \n \n\n7 years to\n\n8 years\n\n \n \n \n \n \n\n8 years to\n\n9 years\n\n \n \n \n \n \n\n9 years to\n\n10 years\n\n \n \n \n \n  \n\n10+ years\n\n \n\n \n \n55,337\n \n \n\n \n \n47,266\n \n \n\n \n \n36,423\n \n \n\n \n \n31,878\n \n \n\n \n \n27,073\n \n \n\n  \n \n53,494\n\n \n\n*1\n\nBreakdown of net settlements and gross settlements in the derivative liabilities are presented below.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31, 2026\n\n \n\n \n  \n\nTotal\n\n \n \n \n \n  \n\nWithin\n\n1 year\n\n \n \n \n \n  \n\n1 year to\n\n2 years\n\n \n \n \n \n  \n\n2 years to\n\n3 years\n\n \n \n \n \n  \n\n3 years to\n\n4 years\n\n \n \n \n \n  \n\n4 years to\n\n5 years\n\n \n \n \n \n  \n\n5+ years\n\n \n\nDerivative contracts\n\n  \n \n       \n \n \n\n  \n \n       \n \n \n\n  \n \n        \n \n \n\n  \n \n       \n \n \n\n  \n \n      \n \n \n\n  \n \n      \n \n \n\n  \n \n       \n \n\n-Net settled\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nPaid\n\n  \n \n70,216\n \n \n\n  \n \n70,216\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n\nDerivative contracts\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n-Gross settled\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nReceived\n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n\nPaid\n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n \n\n  \n \n-\n \n\nSupplier Finance Arrangements\n\nSony has entered into supplier finance arrangements with third-party financial institutions for certain transactions with suppliers. Under these arrangements, Sony has obligations to make payments to third-party financial institutions for the same amount as payables based on such transactions with suppliers. Suppliers may receive funds from the third-party financial institutions earlier than the payment due dates. There are no supplier finance arrangements that have a significant impact on liquidity risk.\n\n \n\n(5)\n\nForeign exchange risk\n\nFor foreign exchange risk inherent in the insurance business, which is included in the Financial Services business, refer to Note 13. For foreign exchange risk inherent in the banking business, which is included in the Financial Services business, refer to (7) Market risks for the banking business.\n\n \n\nF-4\n\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nRisk management policy and exposure\n\nCosts and prices of products and services in transactions denominated in foreign currencies are affected by currency exchange rate fluctuation, which may have adverse impacts on Sony’s business, operating results, and financial condition. Sony seeks to reduce its exposure to foreign exchange risk mainly by using derivatives such as currency forward contracts or investing in securities denominated in the same currency.\n\nThe net amount of Sony’s exposure to foreign exchange risk mainly includes the following. Foreign exchange risk exposures that are mitigated by the use of derivatives are excluded.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31\n\n \n\n \n \n\n  2025  \n\n \n \n \n \n \n\n  2026  \n\n \n\nU.S. dollar\n\n \n \n143,720\n \n \n\n \n \n61,391\n \n\nEuro\n\n \n \n(2,903\n) \n \n\n \n \n(4,651\n)\n\n \n\n*\n\nNet exposures resulting in a liability are presented as negative and net exposures resulting in an asset are presented as positive.\n\nSensitivity analysis\n\nThe table below shows the effects on the income before income taxes regarding the financial instruments denominated in foreign currencies held by Sony as of March 31, 2025 and 2026 if the Japanese yen had strengthened by 10% against the U.S. dollar or euro. If the Japanese yen had weakened by 10% against the U.S. dollar or euro, there would be an opposite impact on income before income taxes in the same amount. This analysis was performed based on the assumption that all other variables stay the same.\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nMarch 31\n\n \n\n \n\n \n\n  2025  \n\n \n\n \n\n \n\n \n\n \n\n  2026  \n\n \n\nU.S. dollar\n\n \n \n (14,372\n)\n \n\n \n \n (6,139\n) \n\nEuro\n\n \n \n290\n \n \n\n \n \n465\n \n\n \n\n(6)\n\nCredit risk\n\nRisk management policy and exposure\n\nSony is exposed to credit risk in relation to its customers with outstanding trade receivables and the financial institutions who are the counterparties of derivative instruments that Sony holds to hedge the foreign exchange risk related to such trade receivables.\n\nIn order to manage risks inherent in trade receivables, Sony assesses management conditions and creditworthiness of prospective customers and sets credit limits before commencement of business in accordance with Sony’s internal rules regarding credit management. After commencement of business, in accordance with Sony’s internal rules regarding receivable management, Sony seeks to promptly identify and mitigate the risk of uncollectible receivables due to deterioration in the financial conditions of customers by managing payment due dates and outstanding balances by customer, consistently reviewing the status of transactions, payment history, and trends in the outstanding balance of customers, and actively monitoring their management and business conditions. Sony makes judgments about the creditworthiness of customers based on past collection experience, the current conditions, forecasts of future economic conditions and ongoing credit risk evaluations when calculating the loss allowances for the expected credit losses from trade receivables.\n\nIn addition, the credit risk inherent in derivative transactions is considered low since Sony enters into derivative transactions only with financial institutions with high creditworthiness or central clearing house counterparties, and such derivative transactions are collateralized.\n\n(As of March 31, 2025)\n\nThe Financial Services business formulates Fundamental Principles for Risk Management and manages risks depending on its subsidiaries’ size, characteristics and business. Risk Management Guidelines in the Financial Services business establish a detailed framework for risk management, and each of the subsidiaries in the Financial Services business has developed a framework for risk management on its own depending on the characteristics of financial assets, including issuer credit risk on debt securities, counterparty risks and risks related to loans, including credit screenings, credit limits, the management of credit information, credit ratings, the setting of guarantees or collateral and the handling of problem assets on a\n\ncase-by-case\n\nbasis. Relevant departments of subsidiaries in the Financial Services business periodically report risk management conditions to their Boards of Directors.\n\n \n\nF-4\n\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nRisk exposure analysis\n\n \n\n(a)\n\nChanges in the loss allowances\n\nTrade and other receivables, and contract assets including\nnon-current\nother receivables in the Pictures segment\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\n  Lifetime expected credit losses  \n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n2025\n\n \n \n \n \n \n\n2026\n\n \n\nBalance at beginning of the fiscal year\n\n \n \n33,066\n \n \n\n \n \n26,847\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nChanges due to financial assets recognized at beginning of the fiscal year:\n\n \n \n        \n \n \n\n \n \n        \n \n\n- Financial assets that have been derecognized\n\n \n \n(1,843\n) \n \n\n \n \n(578\n)\n\nNew financial assets originated or purchased\n\n \n \n9,408\n \n \n\n \n \n8,486\n \n\nWrite-offs\n\n \n \n(11,936\n) \n \n\n \n \n(4,900\n)\n\nChanges in models/risk parameters\n\n \n \n(1,400\n) \n \n\n \n \n1,801\n\nForeign exchange and other movements\n\n \n \n(448\n) \n \n\n \n \n1,896\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nBalance at end of the fiscal year\n\n \n \n26,847\n \n \n\n \n \n33,552\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nDebt Securities\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\n  12-month expected credit losses\n\n*1\n  \n\n \n\n \n\n \n\nFiscal year ended March 31\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n \n\n \n\n \n\n2026\n\n \n\nBalance at beginning of the fiscal year\n\n \n \n58\n \n \n\n \n \n61\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nChanges due to financial assets recognized at beginning of the fiscal year:\n\n \n \n        \n \n \n\n \n \n        \n \n\n- Financial assets that have been derecognized\n\n \n \n(3\n) \n \n\n \n \n-\n\nNew financial assets originated or purchased\n\n \n \n9\n \n \n\n \n \n-\n \n\nChanges in models/risk parameters\n\n \n \n(3\n) \n \n\n \n \n-\n\nForeign exchange and other movements\n*2\n\n \n \n-\n \n \n\n \n \n(61\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nBalance at end of the fiscal year\n\n \n \n61\n \n \n\n \n \n-\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n \n\n*1\n\nFor all debt securities, Sony considers that the credit risk has not increased significantly since initial recognition, and therefore the loss allowance is measured at an amount equal to\n12-months\nof expected credit losses.\n\n \n\n*2\n\nThe figures for the fiscal year ended March 31, 2026 include the impact of the deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\nThe loss allowances for debt securities are for debt securities measured at fair value through other comprehensive income as of March 31, 2025.\n\n \n\nF-\n4\n\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nLoans\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\n12-month expected\n\ncredit losses\n\n \n \n \n \n \n\nLifetime expected\ncredit losses\n\n \n \n \n \n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n \n \n277\n \n \n\n \n \n1,502\n \n \n\n \n \n          1,779\n \n\nChanges due to financial assets recognized as of April 1, 2024:\n\n \n\n \n\n \n\n \n\n \n\n- Transfer to lifetime expected credit losses\n\n \n \n(2\n) \n \n\n \n \n2\n \n \n\n \n \n-\n \n\n- Transfer to\n12-month\nexpected credit losses\n\n \n \n166\n \n \n\n \n \n(166\n) \n \n\n \n \n-\n \n\n- Financial assets that have been derecognized\n\n \n \n(23\n) \n \n\n \n \n(156\n) \n \n\n \n \n(179\n) \n\nNew financial assets originated or purchased\n\n \n \n32\n \n \n\n \n \n16\n \n \n\n \n \n48\n \n\nChanges in models/risk parameters\n\n \n \n(217\n) \n \n\n \n \n189\n \n \n\n \n \n(28\n) \n\nForeign exchange and other movements\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n*1\n\n \n \n233\n \n \n\n \n \n1,387\n \n \n\n \n \n1,620\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nChanges due to financial assets recognized as of March 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n- Transfer to lifetime expected credit losses\n\n \n \n-\n\n \n\n \n \n-\n \n \n\n \n \n-\n \n\n- Transfer to\n12-month\nexpected credit losses\n\n \n \n-\n \n \n\n \n \n-\n\n \n\n \n \n-\n \n\n- Financial assets that have been derecognized\n\n \n \n(0\n)\n \n\n \n \n(19\n)\n \n\n \n \n(19\n)\n\nNew financial assets originated or purchased\n\n \n \n0\n \n \n\n \n \n64\n \n \n\n \n \n64\n \n\nChanges in models/risk parameters\n\n \n \n-\n\n \n\n \n \n-\n \n \n\n \n \n-\n\nForeign exchange and other movements\n*2\n\n \n \n(233\n)\n \n\n \n \n(356\n)\n \n\n \n \n(589\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n*1\n\n \n \n0\n \n \n\n \n \n1,076\n \n \n\n \n \n1,076\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n \n\n*1\n\nLoans that are credit-impaired as of March 31, 2025 and 2026 were not significant.\n\n \n\n*2\n\nThe figures for the fiscal year ended March 31, 2026 include the impact of the deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\n(b)\n\nDescription of collateral held as security and other credit enhancements\n\nSony assesses creditworthiness of each customer on an individual project basis. When it is determined to extend credit to a customer, the amount of collateral to be obtained will be based on the credit assessment for the customer by management. Collateral held as security includes, but is not limited to the following:\n\n \n\n \n•\n \n\nFloating charges on all assets and businesses of the customer\n\n \n\n \n•\n \n\nSpecific or related guarantees\n\n \n\n \n•\n \n\nDebt guarantees from customers and loan agreements with favorable and unfavorable covenant terms\n\nThe carrying amount of the financial assets, without taking into account any collateral held or credit enhancements, represents Sony’s maximum exposure to credit risk on these assets. For maximum exposure to credit risk of securities to which impairment requirements in IFRS 9 “Financial Instrument” (“IFRS 9”) are not applied without taking into account any collateral held or other credit enhancements, refer to Note 5.\n\nAs of March 31, 2025, in the Financial Services business, housing loans have sufficient collateral, which results in no significant loss allowance being recognized. As of March 31, 2025, there were no securities received as collateral for short-term lending transactions which were permitted to be sold or repledged.\n\n \n\n(c)\n\nCredit risk exposure by risk rating grades\n\nCredit risk exposure by risk rating grades as of March 31, 2025 and 2026, is as follows:\n\nTrade and other receivables, and contract assets including\nnon-current\nother receivables in the Pictures segment\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n \n\n \n\n  \n\n2026\n\n \n\nOutstanding receivables by overview period of overdue (Gross carrying amount)\n\n  \n\n \n\n  \n\nNot past due or due within 30 days\n\n  \n \n         1,972,150\n \n \n\n  \n \n         1,831,302\n \n\nDue over 30 to 90 days\n\n  \n \n46,897\n \n \n\n  \n \n66,618\n \n\nDue over 90 days\n\n  \n \n56,512\n \n \n\n  \n \n49,238\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n2,075,559\n \n \n\n  \n \n1,947,158\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n \n\nF-\n\n50\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nDebt securities\n\nDebt securities held in the Financial Services business are substantially all composed of investment grade debt securities, and, as a financial instrument subject to IFRS 9 impairment requirements,\n12-month\nexpected losses are recorded.\n\nThe following table shows an analysis of the gross carrying amount for debt securities measured at amortized cost or at fair value through other comprehensive income based on a credit rating system in the Financial Services business, which is primarily a composite of external credit ratings as of March 31, 2025.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n\nDebt securities by credit ratings (Gross carrying amount)\n\n  \n\nAAA\n\n  \n \n895,392\n \n\nAA\n\n  \n \n3,245,007\n \n\nA\n\n  \n \n7,052,650\n \n\nBBB\n\n  \n \n27,660\n \n\nOther\n\n  \n \n45,849\n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n11,266,558\n \n\n  \n\n \n\n \n\n \n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of debt securities as of March 31, 2026.\n\nLoans\n\nLoans held in the banking business in the Financial Services business are regularly reassessed by the credit ratings of debtors, and as a financial instrument subject to IFRS 9 impairment requirements,\n12-month\nor lifetime expected credit losses are recorded depending on whether or not the credit risk has increased significantly since initial recognition or not.\n\nThe following table shows an analysis of the gross carrying amount for loans measured at amortized cost based on credit ratings by debtors in the banking business in the Financial Services business as of March 31, 2025.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 2025\n\n \n\n \n \n\nNormal*\n\n \n \n \n \n \n\nOther than Normal\n\n \n \n \n \n \n\nTotal\n\n \n\n \n \n\n12-month\n\nexpected\ncredit\n\nlosses\n\n \n \n \n \n \n\nLifetime\n\nexpected\ncredit\n\nlosses\n\n \n \n \n \n \n\nSub total\n\n \n \n \n \n \n\n12-month\n\nexpected\ncredit\n\nlosses\n\n \n \n \n \n \n\nLifetime\n\nexpected\ncredit\n\nlosses\n\n \n \n \n \n \n\nSub total\n\n \n \n \n \n\nLoans\n\n \n \n    \n \n \n\n \n \n    \n \n \n\n \n \n    \n \n \n\n \n \n    \n \n \n\n \n \n    \n \n \n\n \n \n    \n \n \n\n \n \n    \n \n\nHousing loans\n\n \n \n3,758,168\n \n \n\n \n \n525\n \n \n\n \n \n3,758,693\n \n \n\n \n \n2,393\n \n \n\n \n \n2,661\n \n \n\n \n \n5,054\n \n \n\n \n \n3,763,747\n \n\nOther\n\n \n \n20,861\n \n \n\n \n \n322\n \n \n\n \n \n21,183\n \n \n\n \n \n7\n \n \n\n \n \n84\n \n \n\n \n \n91\n \n \n\n \n \n21,274\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal\n\n \n \n3,779,029\n \n \n\n \n \n847\n \n \n\n \n \n3,779,876\n \n \n\n \n \n2,400\n \n \n\n \n \n2,745\n \n \n\n \n \n5,145\n \n \n\n \n \n3,785,021\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n \n\n*\n\nNormal is defined as borrowers who have strong results and no particular problems with their financial position.\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of loans as of March 31, 2026.\n\n \n\n(d)\n\nCredit risk for debt securities designated to be measured at fair value through profit or loss\n\nThe credit risk exposures for debt securities designated to be measured at fair value through profit or loss were 893,972 \nmillion yen as of March 31, 2025. As a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is \nno\nbalance of credit risk exposures for debt securities designated to be measured at fair value through profit or loss as of March 31, 2026. \n\nThe changes in the fair value attributable to the changes in credit risk were a decrease of 208 million yen and 620 million yen for the fiscal years ended March 31, 2025 and the period from April 1 through September 30, 2025, respectively. The cumulative changes were an increase of 1,357 million yen and 737 million yen as of March 31, 2025 and September 30, 2025, respectively.\n\n \n\nF-5\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(7)\n\nMarket risks for the banking business\n\n(As of March 31, 2025)\n\nIn the banking business, by formulating and conforming with market risk management policies, Sony manages the risk of loss for when the value of assets and liabilities (including\noff-balance-sheet\nitems), and income from assets and liabilities could be adversely affected by changes in various market risk factors, such as interest rates, exchange rates and stock prices. Market risk management policies specify details such as risk management methods and procedures. Based on ALM and risk management policies determined by the banking subsidiary’s Board of Directors, an ALM committee and a risk management committee typically meet once each month to understand and confirm actual conditions and deliberate future measures and risk conditions. On a daily basis, the risk management division maintains an overall understanding of interest, exchange rates and durations of financial assets and liabilities, and monitors Value at Risk (“VaR”), which quantifies the maximum expected loss which could occur during a given holding period and at a given probability, and interest rate sensitivity analysis, and confirms regulatory compliance. Sony also conducts interest rate swaps and other derivative transactions to hedge against interest and exchange rate fluctuation risks. VaR is calculated by the historical method (time period: 250 days, confidence level: 99.0%) and is used for quantitative analysis in managing interest and exchange rate fluctuation risks. The total market risk volume as of March 31, 2025 was 32,076 million yen. VaR is based on the assumption that risk parameters other than interest rates and exchange rates are fixed. In the event that fluctuations exceed the rational forecast band for interest and exchange rates, the risk impact may exceed the amount calculated. The aforementioned market risk management is carried out primarily by the risk management division. The division periodically reports risk management conditions to the banking subsidiary’s Board of Directors and Executive Committee. In addition, the banking subsidiary’s internal audit division conducts audits of the risk management conditions.\n\n \n\n7.\n\nInventories\n\nInventories are comprised of the following:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n 2025 \n\n \n \n \n \n  \n\n 2026 \n\n \n\nFinished products\n\n  \n \n837,759\n \n \n\n  \n \n791,272\n \n\nWork in process\n\n  \n \n314,011\n \n \n\n  \n \n266,712\n \n\nRaw materials, purchased components and supplies\n\n  \n \n159,000\n \n \n\n  \n \n169,367\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nInventories\n\n  \n \n1,310,770\n \n \n\n  \n \n1,227,351\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nFor the fiscal years ended March 31, 2024, 2025 and 2026 the write-downs of inventories were 117,633 million yen, 107,164 million yen and 111,993 million yen, respectively.\n\nFor the fiscal years ended March 31, 2024, 2025 and 2026 the amounts of inventories expensed and included in cost of sales were 3,635,969 million yen, 3,630,110 million yen and 3,492,356 million yen, respectively. Included within these amounts for the fiscal years ended March 31, 2024, 2025 and 2026 were employee benefits expenses of 307,041 million yen, 309,934 million yen and 324,366 million yen, respectively, and depreciation and amortization expenses of 287,798 million yen, 335,829 million yen and 363,227 million yen, respectively. Other cost of sales mainly consists of material costs, subcontractor costs and other professional service fees.\n\n \n\n8.\n\nInvestments in associates and joint ventures\n\nThere are no associates or j\noi\nnt ventures that are individually material to Sony.\n\nThe carrying amounts of investments in associates and joint ventures that are not individually material to Sony, as of March 31, 2025 and 2026 are as follows:\n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n 2025 \n\n \n\n \n\n \n\n \n\n  \n\n 2026 \n\n \n\nInvestments accounted for using the equity method\n\n  \n\n \n\n  \n\nAssociates\n\n  \n \n303,321\n \n \n\n  \n \n455,080\n \n\nJoint ventures*\n\n  \n \n44,397\n \n \n\n  \n \n28,629\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n347,718\n \n \n\n  \n \n 483,709\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n \n\nF-5\n2\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nSony’s share of comprehensive income, profit or loss and other comprehensive income, of associates and joint ventures that are not individually material to Sony for the fiscal years ended March 31, 2024, 2025 and 2026 are as follows:\n\nIn connection with the Resolution for the plan regarding the execution of the Partial Spin-off of the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, Sony’s share of comprehensive income of affiliates held by the Financial Services business is included in comprehensive income (loss) from discontinued operations. Consequently, the figures for comparative periods have been re-presented. Furthermore, as a result of the execution of the Partial Spin-off of the Financial Services business, SFGI became an affiliate of Sony accounted for using the equity method. The table below includes Sony’s share of comprehensive income of SFGI accounted for using the equity method after the execution of the Partial Spin-off of the Financial Services business.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n 2024 \n\n \n \n \n \n  \n\n 2025 \n\n \n \n \n \n  \n\n 2026 \n\n \n\nShare of profit or loss\n\n  \n\n \n\n  \n\n \n\n  \n\nAssociates\n\n  \n \n19,782\n \n \n\n  \n \n19,682\n \n \n\n  \n \n21,026\n \n\nJoint ventures\n*\n\n  \n \n(9,225\n)\n \n\n \n\n  \n \n(27,547\n)\n \n\n  \n \n(85,220\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n10,557\n \n \n\n  \n \n(7,865\n)\n \n\n  \n \n(64,194\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nShare of other comprehensive income\n\n  \n\n \n\n  \n\n \n\n  \n\nAssociates\n\n  \n \n5,311\n \n \n\n  \n \n(1,268\n)\n \n\n  \n \n(20,969\n)\n\nJoint ventures\n\n  \n \n37\n \n \n\n  \n \n20\n \n \n\n  \n \n(70\n)\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n5,348\n \n \n\n  \n \n(1,248\n)\n \n\n  \n \n(21,039\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nShare of comprehensive income\n\n  \n\n \n\n  \n\n \n\n  \n\nAssociates\n\n  \n \n25,093\n \n \n\n  \n \n18,414\n \n \n\n  \n \n57\n \n\nJoint ventures\n*\n\n  \n \n(9,188\n)\n \n\n  \n \n(27,527\n)\n \n\n  \n \n(85,290\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n15,905\n \n \n\n  \n \n(9,113\n)\n \n\n \n\n  \n \n(85,233\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n \n\n*\n\nSony Honda Mobility Inc. (“Sony Honda Mobility”), a joint venture of Sony Group Corporation and Honda Motor Co., Ltd. (“Honda”), decided to discontinue the development and launch of its electric vehicle models and downsize its business as a result of Honda’s reassessment of its automobile electrification strategy announced in March 2026. Consequently, an additional\n44.9\n\nbillion yen loss for the share of profit (loss) of investments accounted for using the equity method was recorded, which is included in the Sony’s share of profit or loss and comprehensive income for the fiscal year ended March 31, 2026. In addition, a 25.2 billion yen loss for the share of profit (loss) of investments accounted for using the equity method, which was recognized in excess of the carrying amount of the investment in Sony Honda Mobility, is not included in the carrying amount of investments in joint ventures as of March 31, 2026, and is included in other current liabilities in the consolidated statements of financial position. \n\n \n\nF-5\n\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n9.\n\nProperty, plant and equipment\n\nThe changes in property, plant and equipment for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nLand\n\n \n \n \n \n  \n\nBuildings\n\n \n \n \n \n  \n\nMachinery and\nequipment\n\n \n \n \n \n  \n\nConstruction\nin progress\n\n \n \n \n \n  \n\nTotal\n\n \n\nBalance as of April 1, 2024:\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nCost\n\n  \n \n85,983\n \n \n\n  \n \n1,033,758\n \n \n\n  \n \n2,551,174\n \n \n\n  \n \n185,287\n \n \n\n  \n \n3,856,202\n \n\nAccumulated depreciation and impairment losses\n\n  \n \n(37\n) \n \n\n  \n \n(589,975\n) \n \n\n  \n \n(1,742,511\n) \n \n\n  \n \n(1,039\n) \n \n\n  \n \n(2,333,562\n) \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n85,946\n \n \n\n  \n \n443,783\n \n \n\n  \n \n808,663\n \n \n\n  \n \n184,248\n \n \n\n  \n \n1,522,640\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nChanges in carrying amount:\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nAdditions\n\n  \n \n2,815\n \n \n\n  \n \n19,701\n \n \n\n  \n \n76,224\n \n \n\n  \n \n248,163\n \n \n\n  \n \n346,903\n \n\nAcquisitions through business combinations\n\n  \n \n258\n \n \n\n  \n \n12,511\n \n \n\n  \n \n3,964\n \n \n\n  \n \n1,221\n \n \n\n  \n \n17,954\n \n\nReclassifications\n\n  \n \n371\n \n \n\n  \n \n56,556\n \n \n\n  \n \n213,401\n \n \n\n  \n \n(273,978\n) \n \n\n  \n \n(3,650\n) \n\nDisposals or classified as held for sale\n*1\n\n  \n \n(657\n) \n \n\n  \n \n(1,957\n) \n \n\n  \n \n(5,762\n) \n \n\n  \n \n(984\n) \n \n\n  \n \n(9,360\n) \n\nDepreciation\n*2\n\n  \n \n-\n \n \n\n  \n \n(45,722\n) \n \n\n  \n \n(301,344\n) \n \n\n  \n \n-\n \n \n\n  \n \n(347,066\n) \n\nImpairment losses\n\n  \n \n-\n \n \n\n  \n \n(1,154\n) \n \n\n  \n \n(645\n) \n \n\n  \n \n(203\n) \n \n\n  \n \n(2,002\n) \n\nTranslation adjustment\n\n  \n \n(162\n) \n \n\n  \n \n(2,051\n) \n \n\n  \n \n901\n \n \n\n  \n \n497\n \n \n\n  \n \n(815\n) \n\nOther\n\n  \n \n54\n \n \n\n  \n \n(212\n) \n \n\n  \n \n(10,904\n) \n \n\n  \n \n118\n \n \n\n  \n \n(10,944\n) \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal changes\n\n  \n \n2,679\n \n \n\n  \n \n37,672\n \n \n\n  \n \n(24,165\n) \n \n\n  \n \n(25,166\n) \n \n\n  \n \n(8,980\n) \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2025:\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nCost\n\n  \n \n88,662\n \n \n\n  \n \n1,093,460\n \n \n\n  \n \n2,719,283\n \n \n\n  \n \n159,963\n \n \n\n  \n \n4,061,368\n \n\nAccumulated depreciation and impairment losses\n\n  \n \n(37\n) \n \n\n  \n \n(612,005\n) \n \n\n  \n \n(1,934,785\n) \n \n\n  \n \n(881\n) \n \n\n  \n \n(2,547,708\n) \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n88,625\n \n \n\n  \n \n481,455\n \n \n\n  \n \n784,498\n \n \n\n  \n \n159,082\n \n \n\n  \n \n1,513,660\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nChanges in carrying amount:\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nAdditions\n\n  \n \n495\n \n \n\n  \n \n14,448\n \n \n\n  \n \n73,757\n \n \n\n  \n \n260,571\n \n \n\n  \n \n349,271\n \n\nAcquisitions through business combinations\n\n  \n \n-\n \n \n\n  \n \n396\n \n \n\n  \n \n1,068\n \n \n\n  \n \n-\n \n \n\n  \n \n1,464\n \n\nReclassifications\n\n  \n \n9\n \n \n\n  \n \n138,417\n \n \n\n  \n \n136,416\n \n \n\n  \n \n(276,907\n)\n \n\n  \n \n(2,065\n)\n\nDisposals or classified as held for sale\n*1\n\n  \n \n(584\n)\n \n\n  \n \n(19,167\n)\n \n\n  \n \n(14,637\n)\n \n\n  \n \n(3,820\n)\n \n\n  \n \n(38,208\n)\n\nClassified as held for distribution to owners\n*3\n\n  \n\n(6,672\n) \n \n\n  \n\n(24,134\n) \n \n\n  \n\n(1,535\n) \n \n\n  \n\n(62\n) \n \n\n  \n\n(32,403\n) \n\nDepreciation\n*2\n\n  \n \n-\n \n \n\n  \n \n(47,232\n)\n \n\n  \n \n(281,288\n)\n \n\n  \n \n-\n \n \n\n  \n \n(328,520\n)\n\nImpairment losses\n*4\n\n  \n \n-\n \n \n\n  \n \n(9,800\n)\n \n\n  \n \n(13,784\n)\n \n\n  \n \n(13,900\n)\n \n\n  \n \n(37,484\n)\n\nTranslation adjustment\n\n  \n \n1,440\n \n \n\n  \n \n12,139\n \n \n\n  \n \n10,053\n \n \n\n  \n \n2,179\n \n \n\n  \n \n25,811\n \n\nOther\n\n  \n \n-\n \n \n\n  \n \n(463\n)\n \n\n  \n \n3,970\n \n \n\n  \n \n(1,228\n)\n \n\n  \n \n2,279\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nTotal changes\n\n  \n \n(5,312\n)\n \n\n  \n \n64,604\n \n \n\n  \n \n(85,980\n)\n \n\n  \n \n(33,167\n)\n \n\n  \n \n(59,855\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2026:\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\n \n\n  \n\nCost\n\n  \n \n83,313\n \n \n\n  \n \n1,175,951\n \n \n\n  \n \n2,831,795\n \n \n\n  \n \n140,944\n \n \n\n  \n \n4,232,003\n \n\nAccumulated depreciation and impairment losses\n\n  \n \n-\n\n \n\n  \n \n(629,892\n)\n \n\n  \n \n(2,133,277\n)\n \n\n  \n \n(15,029\n)\n \n\n  \n \n(2,778,198\n)\n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n83,313\n \n \n\n  \n \n546,059\n \n \n\n  \n \n698,518\n \n \n\n  \n \n125,915\n \n \n\n  \n \n1,453,805\n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n \n\n  \n\n \n\n \n\n \n\n \n\n*1\n\nAn asset or disposal group for which the cash flows are expected to arise principally from sale rather than continuing use is classified to current asset as an asset held for sale.\n\n \n\n*2\n\nA portion of depreciation expenses is allocated to the cost of inventory and recognized in cost of sales as inventory is sold, or directly recognized in selling, general and administrative expenses and research and development expenditures in the consolidated statements of income, depending on the use of the asset.\n\n \n\n*3\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, assets of the Financial Services business have been classified as a disposal group held for distribution to owners. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there are no balances related to the Financial Services business as of March 31, 2026.\n\n \n\n*4\n\nRefer to Note 12 for the details of impairment losses.\n\n \n\nF-5\n\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n10.\n\nLeases\n\nSony leases communication and commercial equipment, plant, office space, warehouses, employees’ residential facilities and other assets.\n\n \n\n(1)\n\nROU assets as a lessee\n\nThe changes in ROU assets for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\n Land \n\n \n \n\n Buildings \n\n \n \n\nMachinery and\nequipment\n\n \n \n\n  Total  \n\n \n\nBalance as of April 1, 2024:\n\n  \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n14,815\n \n \n \n424,508\n \n \n \n64,072\n \n \n \n503,395\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in the carrying amount\n\n  \n\n \n\n \n\n \n\nIncrease due to new lease agreements and remeasurement of lease liabilities\n\n  \n \n6,104\n \n \n \n102,348\n \n \n \n6,366\n \n \n \n114,818\n \n\nDecrease due to termination of lease agreements and remeasurement of lease liabilities\n\n  \n \n(4\n) \n \n \n(13,615\n) \n \n \n(1,334\n) \n \n \n(14,953\n) \n\nDepreciation\n\n  \n \n(1,342\n) \n \n \n(87,916\n) \n \n \n(12,774\n) \n \n \n(102,032\n) \n\nOther\n\n  \n \n(288\n) \n \n \n20,928\n \n \n \n(183\n) \n \n \n20,457\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal changes\n\n  \n \n4,470\n \n \n \n21,745\n \n \n \n(7,925\n) \n \n \n18,290\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025:\n\n  \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n19,285\n \n \n \n446,253\n \n \n \n56,147\n \n \n \n521,685\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in the carrying amount\n\n  \n\n \n\n \n\n \n\nIncrease due to new lease agreements and remeasurement of lease liabilities\n\n  \n \n186\n\n \n \n77,859\n\n \n \n6,210\n\n \n \n84,255\n\nDecrease due to termination of lease agreements and remeasurement of lease liabilities\n\n  \n \n(38\n)\n \n \n(9,973\n)\n \n \n(1,777\n)\n \n \n(11,788\n)\n\nClassified as held for distribution to owners\n*1\n\n  \n \n(7,536\n) \n \n \n(67,291\n) \n \n \n(722\n) \n \n \n(75,549\n) \n\nDepreciation\n\n  \n \n(1,086\n)\n \n \n(83,780\n)\n \n \n(12,239\n)\n \n \n(97,105\n)\n\nOther\n*2\n\n  \n \n1,072\n \n \n \n101,634\n \n \n \n141\n \n \n \n102,847\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal changes\n\n  \n \n(7,402\n)\n \n \n18,449\n \n \n \n(8,387\n)\n \n \n2,660\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026:\n\n  \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n11,883\n \n \n \n464,702\n \n \n \n47,760\n \n \n \n524,345\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the assets of the Financial Services business have been classified as a disposal group held for distribution to owners. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there are no balances related to the Financial Services business as of March 31, 2026.\n\n \n\n*2\n\nThe amount includes 95,938 \n\nmillion yen of ROU assets arising from lease agreements with the Financial Services business that were previously eliminated as intercompany transactions. Following the execution of the Partial Spin-off of the Financial Services business, these leases became external transactions and are therefore recognized in the consolidated statements of financial position. \n\n \n\n(2)\n\nIncome, expenses, and cash flows (except for depreciation) arising from lease contracts as a lessee and lessor are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n 2024 \n\n \n \n\n 2025 \n\n \n \n\n 2026 \n\n \n\nInterest expenses on lease liabilities\n\n  \n \n12,833\n \n \n \n15,401\n \n \n \n17,326\n \n\nExpenses related to short-term leases accounted for applying an exemption\n\n  \n \n20,798\n \n \n \n35,767\n \n \n \n32,655\n \n\nIncome from subleases\n\n  \n \n(1,589\n) \n \n \n(1,202\n) \n \n \n(1,283\n)\n\nNet cash outflows for leases\n\n  \n \n100,438\n \n \n \n109,673\n \n \n \n112,534\n \n\nNote: The above amounts include income or loss and cash flows from the Financial Services business, which are presented in net income (loss) from discontinued operations in the consolidated statements of income and in net cash used in financing activities from discontinued operations in the consolidated statements of cash flows.\n\nRefer to Note 6 for the maturity analysis of Sony’s financial liabilities including lease liabilities.\n\n \n\nF-5\n\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nRefer to Note 6 for the maturity analysis of Sony’s financial liabilities including lease liabilities.\n\n \n\n11.\n\nGoodwill and intangible assets\n\n \n\n(1)\n\nGoodwill\n\nThe changes in goodwill for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n 2025 \n\n \n \n\n 2026 \n\n \n\nBalance at beginning of the fiscal year\n\n  \n\n \n\nCost\n\n  \n \n1,884,627\n \n \n \n1,903,617\n \n\nAccumulated impairments\n\n  \n \n(397,527\n) \n \n \n(394,896\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n1,487,100\n \n \n \n1,508,721\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nIncrease (decrease) due to:\n\n  \n\n \n\nAcquisitions\n\n  \n \n44,424\n \n \n \n88,058\n \n\nDisposals or classified as held for sale\n\n  \n \n-\n \n \n \n(1,245\n)\n\nClassified as held for distribution to owners\n*1\n\n  \n\n-\n\n \n\n(10,834\n\n)\n \n\nImpairment losses\n*2\n\n  \n \n-\n \n \n \n(17,430\n)\n\nTranslation adjustments\n\n  \n \n(22,803\n) \n \n \n106,636\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal changes\n\n  \n \n21,621\n \n \n \n165,185\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance at end of the fiscal year\n\n  \n\n \n\nCost\n\n  \n \n1,903,617\n \n \n \n2,084,956\n \n\nAccumulated impairments\n\n  \n \n(394,896\n) \n \n \n(411,050\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n\n  \n \n1,508,721\n \n \n \n1,673,906\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n*1  In connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the assets of the Financial Services business were classified as a disposal group held for distribution to owners. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there are no balances related to the Financial Services business as of March 31, 2026.\n\n \n\n*2  Refer to Note 12 for the details of impairment losses.\n\nThe carrying amounts of goodwill by segment as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n  2025  \n\n \n\n  \n\n  2026  \n\n \n\nGame & Network Services\n*1\n\n  \n \n460,621\n \n \n \n487,551\n \n\nMusic\n*2\n\n  \n \n729,593\n \n  \n \n864,910\n \n\nPictures\n*3\n\n  \n \n283,201\n \n  \n \n285,417\n \n\nEntertainment, Technology & Services\n\n  \n \n20,636\n \n  \n \n30,731\n \n\nImaging & Sensing Solutions\n\n  \n \n3,836\n \n  \n \n5,297\n\n \n\nFinancial Services (Discontinued operation)\n*4\n\n  \n \n10,834\n\n \n \n  \n \n-\n \n\nAll Other\n\n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,508,721\n \n  \n \n1,673,906\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n*1\n\nGame & Network Services\n\nAll of the goodwill shown in the G&NS line of the table above is allocated to a group of CGUs which comprise the entire G&NS segment.\n\nIntangible assets with indefinite useful lives related to the G&NS business have carrying amounts of 57,434 million yen and 57,451 million yen, as of March 31, 2025 and 2026, respectively, which are included in “Other intangible assets.” Intangible assets with indefinite useful lives include the trademark for PlayStation\n®\n, which is assessed to have an indefinite useful life as the trademark for PlayStation\n®\nis utilized as the core trademark for Sony’s products and services throughout the G&NS segment and Sony expects to continue using the trademark in the foreseeable future as well.\n\n \n\nF-5\n\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe recoverable amount of the group of CGUs is determined by the value in use. The value in use is calculated by discounting the estimated future cash flows including a terminal value. The estimated future cash flows are prepared based on the MRP. A terminal value after the final year of the total forecasted period is determined by utilizing a perpetual growth rate. The growth rate and the\npre-tax\ndiscount rate were 2.0% and 10.9% as of March 31, 2025, and 2.0% and 9.6% as of March 31, 2026, respectively.\n\n \n\n*2\n\nMusic\n\nGoodwill shown in the Music line of the table above is primarily allocated to the worldwide recorded music and the worldwide music publishing CGUs excluding operations in Japan.\n\nGoodwill related to the worldwide recorded music CGU has carrying amounts of 355,985 million yen and 417,461 million yen, as of March 31, 2025 and 2026, respectively. The recoverable amount of the CGU is determined by the value in use. The value in use is calculated by discounting the estimated future cash flows including a terminal value. The estimated future cash flows are prepared based on the MRP. A terminal value after the final year of the total forecasted period is determined by utilizing a perpetual growth rate. The growth rate and the\npre-tax\ndiscount rate were 1.0% and 12.2% as of March 31, 2025, and 1.0% and 13.7% as of March 31, 2026, respectively.\n\nGoodwill related to the music publishing CGU has carrying amounts of 325,590 million yen and 354,856 million yen, as of March 31, 2025 and 2026, respectively. The recoverable amount of the CGU is determined by the value in use. The value in use is calculated by discounting the estimated future cash flows including a terminal value. The estimated future cash flows are prepared based on the MRP. A terminal value after the final year of the total forecasted period is determined by utilizing a perpetual growth rate. The growth rate and the\npre-tax\ndiscount rate were 3.0% and 11.1% as of March 31, 2025, and 3.4% and 12.1% as of March 31, 2026, respectively.\n\n \n\n*3\n\nPictures\n\nGoodwill shown in the Pictures line of the table above is primarily allocated to the animation distribution CGU.\n\nGoodwill related to the animation distribution CGU has carrying amounts of 139,236 million yen and 148,230 million yen, as of March 31, 2025 and 2026, respectively. The recoverable amount of the CGU is determined by the value in use. The value in use is calculated by discounting the estimated future cash flows including a terminal value. The estimated future cash flows are prepared based on the MRP, with revenues in years beyond the MRP based on declining growth rates. A terminal value is based on a revenue multiple applied to the final year of the total forecasted period. The growth rates beyond the MRP period were 5.0% to 12.0% and 5.0% to 9.0%, and the\npre-tax\ndiscount rates were 16.4% and 18.4% as of March 31, 2025 and 2026, respectively.\n\nThe value in use calculation uses key assumptions such as the\npre-tax\ndiscount rate, perpetual growth rate, competitive and regulatory environment, and technology trends. For each assumption, historical experience, external information, competitors and industry trends are taken into account. Sony does not expect the recoverable amounts to be lower than the carrying amounts even when the growth rate and\npre-tax\ndiscount rate that are used in the evaluation of the recoverable amounts change within a reasonably possible range.\n\n \n\n*4\n\nFinancial Services (Discontinued operation)\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation and has been excluded from the reporting segments. For further information on discontinued operations, refer to Note 33.\n\n \n\nF-5\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(2)\n\nContent assets\n\nThe changes in content assets for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFilm costs\n\n \n \n\nBroadcasting\n\nrights\n\n \n \n\nMusic\n\n  catalogs  \n\n \n \n\nArtist\n\n contracts \n\n \n \n\nMusic\n\ndistribution\n\nrights\n\n \n \n\nGame\n\ncontent\n\n \n \n\nContent\n\nassets Total\n\n \n\nBalance as of April 1, 2024:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCost\n\n \n\n \n\n5,216,247\n\n \n\n \n\n \n\n528,970\n\n \n\n \n\n \n\n1,401,970\n\n \n\n \n\n \n\n54,131\n\n \n\n \n\n \n\n52,498\n\n \n\n \n\n \n\n170,058\n\n \n\n \n\n \n\n7,423,874\n\n \n\nAccumulated amortization and impairment losses\n\n \n\n \n\n(4,684,771\n\n) \n\n \n\n \n\n(404,729\n\n) \n\n \n\n \n\n(335,952\n\n) \n\n \n\n \n\n(18,475\n\n) \n\n \n\n \n\n(17,377\n\n) \n\n \n\n \n\n(34,457\n\n) \n\n \n\n \n\n(5,495,761\n\n) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCarrying amount\n\n \n\n \n\n531,476\n\n \n\n \n\n \n\n124,241\n\n \n\n \n\n \n\n1,066,018\n\n \n\n \n\n \n\n35,656\n\n \n\n \n\n \n\n35,121\n\n \n\n \n\n \n\n135,601\n\n \n\n \n\n \n\n1,928,113\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChanges in carrying amount:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdditions\n*1\n\n \n\n \n\n425,914\n\n \n\n \n\n \n\n112,579\n\n \n\n \n\n \n\n141,927\n\n \n\n \n\n \n\n4,941\n\n \n\n \n\n \n\n17\n\n \n\n \n\n \n\n56,013\n\n \n\n \n\n \n\n741,391\n\n \n\nAcquisitions through business combinations and other\n*2\n\n \n\n \n\n1,868\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n202,660\n\n \n\n \n\n \n\n3,273\n\n \n\n \n\n \n\n5,784\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n213,585\n\n \n\nDisposals or classified as held for sale\n\n \n\n \n\n(43,614\n\n) \n\n \n\n \n\n(97\n\n) \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(564\n\n) \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(44,275\n\n) \n\nAmortization\n\n \n\n \n\n(328,167\n\n) \n\n \n\n \n\n(110,057\n\n) \n\n \n\n \n\n(51,825\n\n) \n\n \n\n \n\n(2,760\n\n) \n\n \n\n \n\n(3,639\n\n) \n\n \n\n \n\n(39,381\n\n) \n\n \n\n \n\n(535,829\n\n) \n\nImpairment losses\n\n \n\n \n\n(14,449\n\n) \n\n \n\n \n\n(88\n\n) \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(13\n\n) \n\n \n\n \n\n(545\n\n) \n\n \n\n \n\n(15,095\n\n) \n\nTranslation adjustment\n\n \n\n \n\n(9,886\n\n) \n\n \n\n \n\n(2,894\n\n) \n\n \n\n \n\n(23,970\n\n) \n\n \n\n \n\n(651\n\n) \n\n \n\n \n\n(132\n\n) \n\n \n\n \n\n(1,309\n\n) \n\n \n\n \n\n(38,842\n\n) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal changes\n\n \n\n \n\n31,666\n\n \n\n \n\n \n\n(557\n\n) \n\n \n\n \n\n268,792\n\n \n\n \n\n \n\n4,239\n\n \n\n \n\n \n\n2,017\n\n \n\n \n\n \n\n14,778\n\n \n\n \n\n \n\n320,935\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCost\n\n \n\n \n\n5,522,693\n\n \n\n \n\n \n\n555,679\n\n \n\n \n\n \n\n1,716,674\n\n \n\n \n\n \n\n61,012\n\n \n\n \n\n \n\n57,952\n\n \n\n \n\n \n\n221,406\n\n \n\n \n\n \n\n8,135,416\n\n \n\nAccumulated amortization and impairment losses\n\n \n\n \n\n(4,959,551\n\n) \n\n \n\n \n\n(431,995\n\n) \n\n \n\n \n\n(381,864\n\n) \n\n \n\n \n\n(21,117\n\n) \n\n \n\n \n\n(20,814\n\n) \n\n \n\n \n\n(71,027\n\n) \n\n \n\n \n\n(5,886,368\n\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n\n \n\n \n\n563,142\n\n \n\n \n\n \n\n123,684\n\n \n\n \n\n \n\n1,334,810\n\n \n\n \n\n \n\n39,895\n\n \n\n \n\n \n\n37,138\n\n \n\n \n\n \n\n150,379\n\n \n\n \n\n \n\n2,249,048\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in carrying amount:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdditions\n*1\n\n \n\n \n\n475,564\n\n \n\n \n\n \n\n104,069\n\n \n\n \n\n \n\n152,768\n\n \n\n \n\n \n\n3,706\n\n \n\n \n\n \n\n171\n\n \n\n \n\n \n\n72,438\n\n \n\n \n\n \n\n808,716\n\n \n\nAcquisitions through business combinations and other\n*2\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n39,586\n\n \n\n \n\n \n\n774\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n40,360\n\n \n\nDisposals or classified as held for sale\n\n \n\n \n\n(50,119\n\n)\n\n \n\n \n\n(627\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(674\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(51,420\n\n)\n\nAmortization\n\n \n\n \n\n(378,855\n\n)\n\n \n\n \n\n(96,772\n\n)\n\n \n\n \n\n(59,510\n\n)\n\n \n\n \n\n(3,776\n\n)\n\n \n\n \n\n(2,236\n\n)\n\n \n\n \n\n(54,029\n\n)\n\n \n\n \n\n(595,178\n\n)\n\nImpairment losses\n*3\n\n \n\n \n\n(20,177\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(587\n\n)\n \n\n \n\n \n\n(53\n\n)\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(56,347\n\n)\n\n \n\n \n\n(77,164\n\n)\n\nTranslation adjustment\n\n \n\n \n\n44,281\n\n \n\n \n\n \n\n7,018\n\n \n\n \n\n \n\n118,825\n\n \n\n \n\n \n\n3,431\n\n \n\n \n\n \n\n1,499\n\n \n\n \n\n \n\n9,199\n\n \n\n \n\n \n\n184,253\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal changes\n\n \n\n \n\n70,694\n\n \n\n \n\n \n\n13,688\n\n \n\n \n\n \n\n251,082\n\n \n\n \n\n \n\n3,408\n\n \n\n \n\n \n\n(566\n\n)\n\n \n\n \n\n(28,739\n\n)\n\n \n\n \n\n309,567\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCost\n\n \n\n \n\n6,356,737\n\n \n\n \n\n \n\n652,384\n\n \n\n \n\n \n\n2,062,201\n\n \n\n \n\n \n\n69,170\n\n \n\n \n\n \n\n61,272\n\n \n\n \n\n \n\n311,394\n\n \n\n \n\n \n\n9,513,158\n\n \n\nAccumulated amortization and impairment losses\n\n \n\n \n\n(5,722,901\n\n)\n\n \n\n \n\n(515,012\n\n)\n\n \n\n \n\n(476,309\n\n)\n\n \n\n \n\n(25,867\n\n)\n\n \n\n \n\n(24,700\n\n)\n\n \n\n \n\n(189,754\n\n)\n\n \n\n \n\n(6,954,543\n\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n\n \n\n \n\n633,836\n\n \n\n \n\n \n\n137,372\n\n \n\n \n\n \n\n1,585,892\n\n \n\n \n\n \n\n43,303\n\n \n\n \n\n \n\n36,572\n\n \n\n \n\n \n\n121,640\n\n \n\n \n\n \n\n2,558,615\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nThe additions in Film costs include the cost of films internally produced and acquired from third party projects. Film costs acquired from third party projects are not a significant portion of Film costs recorded by Sony. The additions in Broadcasting rights, Music catalogs, Artist contracts and Music distribution rights mainly represent acquisitions through contracts with third parties. The additions in Game content include only internally developed game content for the fiscal years ended March 31, 2025 and 2026.\n\n*2\n\nRefer to Notes 27 (7) and 30 (2).\n\n*3\n\nRefer to Note 12 for the details of impairment losses related to the Game content.\n\n \n\nF-\n\n5\n\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(3)\n\nOther intangible assets\n\nThe changes in other intangible assets for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nPatent rights,\n\nknow-how\n\nand license\n\nagreements\n\n \n\n \n\nCustomer\nrelationships\n\n \n\n \n\nTrademarks\n\n \n\n \n\nSoftware\n\n \n\n \n\nTelevision\n\ncarriage\n\ncontracts\n\n \n\n \n\nOther\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCost\n\n \n\n \n\n212,000\n\n \n\n \n\n \n\n70,560\n\n \n\n \n\n \n\n59,377\n\n \n\n \n\n \n\n1,196,266\n\n \n\n \n\n \n\n75,716\n\n \n\n \n\n \n\n211,848\n\n \n\n \n\n \n\n1,825,767\n\n \n\nAccumulated amortization and impairment losses\n\n \n\n \n\n(192,082\n\n) \n\n \n\n \n\n(55,627\n\n) \n\n \n\n \n\n(19,757\n\n) \n\n \n\n \n\n(786,276\n\n) \n\n \n\n \n\n(50,269\n\n) \n\n \n\n \n\n(106,154\n\n) \n\n \n\n \n\n(1,210,165\n\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n\n \n\n \n\n19,918\n\n \n\n \n\n \n\n14,933\n\n \n\n \n\n \n\n39,620\n\n \n\n \n\n \n\n409,990\n\n \n\n \n\n \n\n25,447\n\n \n\n \n\n \n\n105,694\n\n \n\n \n\n \n\n615,602\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in carrying amount:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdditions\n\n \n\n \n\n4,121\n\n \n\n \n\n \n\n230\n\n \n\n \n\n \n\n825\n\n \n\n \n\n \n\n169,476\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n5,356\n\n \n\n \n\n \n\n180,008\n\n \n\nAcquisitions through business combinations\n\n \n\n \n\n8,433\n\n \n\n \n\n \n\n4,338\n\n \n\n \n\n \n\n6,288\n\n \n\n \n\n \n\n4,698\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n18,031\n\n \n\n \n\n \n\n41,788\n\n \n\nInternal development\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n23,128\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n23,128\n\n \n\nDisposals or classified as held for sale\n\n \n\n \n\n(8\n\n) \n\n \n\n \n\n(414\n\n) \n\n \n\n \n\n(1\n\n) \n\n \n\n \n\n(3,897\n\n) \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(397\n\n) \n\n \n\n \n\n(4,717\n\n) \n\nAmortization\n\n \n\n \n\n(6,734\n\n) \n\n \n\n \n\n(6,485\n\n) \n\n \n\n \n\n(5,547\n\n) \n\n \n\n \n\n(127,401\n\n) \n\n \n\n \n\n(4,324\n\n) \n\n \n\n \n\n(15,556\n\n) \n\n \n\n \n\n(166,047\n\n) \n\nImpairment losses\n\n \n\n \n\n(10\n\n) \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(10,337\n\n) \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(3\n\n) \n\n \n\n \n\n(10,350\n\n) \n\nTranslation adjustment\n\n \n\n \n\n(406\n\n) \n\n \n\n \n\n(74\n\n) \n\n \n\n \n\n(478\n\n) \n\n \n\n \n\n(1,567\n\n) \n\n \n\n \n\n(358\n\n) \n\n \n\n \n\n(703\n\n) \n\n \n\n \n\n(3,586\n\n) \n\nOther\n\n \n\n \n\n56\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n23\n\n \n\n \n\n \n\n(6,372\n\n) \n\n \n\n \n\n26\n\n \n\n \n\n \n\n1,653\n\n \n\n \n\n \n\n(4,614\n\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal changes\n\n \n\n \n\n5,452\n\n \n\n \n\n \n\n(2,405\n\n) \n\n \n\n \n\n1,110\n\n \n\n \n\n \n\n47,728\n\n \n\n \n\n \n\n(4,656\n\n) \n\n \n\n \n\n8,381\n\n \n\n \n\n \n\n55,610\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCost\n\n \n\n \n\n216,960\n\n \n\n \n\n \n\n73,654\n\n \n\n \n\n \n\n65,643\n\n \n\n \n\n \n\n1,353,946\n\n \n\n \n\n \n\n73,958\n\n \n\n \n\n \n\n233,542\n\n \n\n \n\n \n\n2,017,703\n\n \n\nAccumulated amortization and impairment losses\n\n \n\n \n\n(191,590\n\n) \n\n \n\n \n\n(61,126\n\n) \n\n \n\n \n\n(24,913\n\n) \n\n \n\n \n\n(896,228\n\n) \n\n \n\n \n\n(53,167\n\n) \n\n \n\n \n\n(119,467\n\n) \n\n \n\n \n\n(1,346,491\n\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n\n \n\n \n\n25,370\n\n \n\n \n\n \n\n12,528\n\n \n\n \n\n \n\n40,730\n\n \n\n \n\n \n\n457,718\n\n \n\n \n\n \n\n20,791\n\n \n\n \n\n \n\n114,075\n\n \n\n \n\n \n\n671,212\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in carrying amount:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdditions\n\n \n\n \n\n3,718\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n8\n\n \n\n \n\n \n\n118,603\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n1,275\n\n \n\n \n\n \n\n123,604\n\n \n\nAcquisitions through business combinations\n*1\n\n \n\n \n\n7,415\n\n \n\n \n\n \n\n6,350\n\n \n\n \n\n \n\n123,058\n\n \n\n \n\n \n\n88\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n2,637\n\n \n\n \n\n \n\n139,548\n\n \n\nInternal development\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n22,814\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n22,814\n\n \n\nDisposals or classified as held for sale\n\n \n\n \n\n(485\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(386\n\n)\n\n \n\n \n\n(10,161\n\n)\n\n \n\n \n\n(28\n\n)\n \n\n \n\n \n\n(169\n\n)\n\n \n\n \n\n(11,229\n\n)\n\nClassified as held for distribution to owners\n*2\n\n \n\n-\n\n \n\n-\n\n \n\n(5\n\n)\n\n \n\n(75,895\n\n)\n\n \n\n-\n\n \n\n(19\n\n) \n\n \n\n(75,919\n\n) \n\nAmortization\n\n \n\n \n\n(8,029\n\n)\n\n \n\n \n\n(3,512\n\n)\n\n \n\n \n\n(6,057\n\n)\n\n \n\n \n\n(122,884\n\n)\n\n \n\n \n\n(4,223\n\n)\n\n \n\n \n\n(15,925\n\n)\n\n \n\n \n\n(160,630\n\n)\n\nImpairment losses\n*3\n\n \n\n \n\n(39\n\n)\n\n \n\n \n\n(2,078\n\n)\n \n\n \n\n \n\n(14,073\n\n)\n \n\n \n\n \n\n(19,652\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(9,940\n\n)\n\n \n\n \n\n(45,782\n\n)\n\nTranslation adjustment\n\n \n\n \n\n903\n\n \n\n \n\n \n\n752\n\n \n\n \n\n \n\n2,154\n\n \n\n \n\n \n\n7,110\n\n \n\n \n\n \n\n1,099\n\n \n\n \n\n \n\n2,307\n\n \n\n \n\n \n\n14,325\n\n \n\nOther\n\n \n\n \n\n3,494\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n1\n\n \n\n \n\n \n\n(19,133\n\n)\n\n \n\n \n\n(1\n\n)\n\n \n\n \n\n(2,726\n\n)\n\n \n\n \n\n(18,365\n\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal changes\n\n \n\n \n\n6,977\n\n \n\n \n\n \n\n1,512\n\n \n\n \n\n \n\n104,700\n\n \n\n \n\n \n\n(99,110\n\n)\n\n \n\n \n\n(3,153\n\n)\n\n \n\n \n\n(22,560\n\n)\n\n \n\n \n\n(11,634\n\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCost\n\n \n\n \n\n223,692\n\n \n\n \n\n \n\n83,877\n\n \n\n \n\n \n\n192,613\n\n \n\n \n\n \n\n1,240,309\n\n \n\n \n\n \n\n77,479\n\n \n\n \n\n \n\n229,027\n\n \n\n \n\n \n\n2,046,997\n\n \n\nAccumulated amortization and impairment losses\n\n \n\n \n\n(191,345\n\n)\n\n \n\n \n\n(69,837\n\n)\n\n \n\n \n\n(47,183\n\n)\n\n \n\n \n\n(881,701\n\n)\n\n \n\n \n\n(59,841\n\n)\n\n \n\n \n\n(137,512\n\n)\n\n \n\n \n\n(1,387,419\n\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCarrying amount\n*1\n\n \n\n \n\n32,347\n\n \n\n \n\n \n\n14,040\n\n \n\n \n\n \n\n145,430\n\n \n\n \n\n \n\n358,608\n\n \n\n \n\n \n\n17,638\n\n \n\n \n\n \n\n91,515\n\n \n\n \n\n \n\n659,578\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nAcquisitions through business combinations of trademarks for the fiscal year ended March 31, 2026 mainly consist of the acquisition of trademarks recognized in connection with the acquisition of an additional equity interest in Peanuts Holdings LLC (“Peanuts Holdings”). For further details of the acquisition of an additional equity interest, refer to Note 30 (1). As a result of the additional acquisition, the carrying amounts in Trademarks include trademarks related to the “PEANUTS” IP as intangible assets with indefinite useful lives, and the carrying amounts of such trademarks as of March 31, 2026 were\n115,799\nmillion yen. The trademarks related to the “PEANUTS” IP are classified as intangible assets with indefinite useful lives because their legal protection period is indefinite, and Sony has assessed that there is no foreseeable limit to the period over which such trademarks are expected to generate net cash inflows for Sony. Such trademarks are allocated to the CGU of the anime-related business operated by Sony Music Entertainment (Japan) Inc. (“SMEJ”) and its consolidated subsidiaries. The recoverable amount of the CGU is determined by the value in use. The \n\n \n\nF-5\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\nvalue in use is calculated by discounting the estimated future cash flows including a terminal value. The estimated future cash flows are prepared based on the MRP. A terminal value after the final fiscal year of the total forecasted period is determined by utilizing a perpetual growth rate.\n\n*2\n\nIn connection with the Resolution for the plan regarding the execution of the Partial Spin-off of the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the assets of the Financial Services business have been classified as a disposal group held for distribution to owners. As a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there are no balances related to the Financial Services business as of March 31, 2026.\n\n*3\n\nRefer to Note 12 for the details of impairment losses.\n\n \n\n12.\n\nImpairment of\nnon-financial\nassets\n\nFor the fiscal year ended March 31, 2026, considering the business environment, as a result of reviewing the future projections for the business operated by Bungie, Inc. (“Bungie”), a wholly-owned subsidiary of Sony within the G&NS segment, Sony determined that sufficient future cash flows were not expected to be generated to recover the carrying amount of the assets. As a result, Sony recognized impairment losses for the entire carrying amount of Bungie’s non-financial assets, excluding goodwill, resulting in impairment losses of 65,312 million yen in other operating (income) expenses, net, related to property, plant and equipment of 11,309 million yen, ROU assets\n\n \n\nof\n14,266\nmillion yen and other intangible assets of\n39,737\nmillion yen, and\nalso\nrecorded impairment losses of\n54,750\nmillion yen in cost of sales related to content assets. The recoverable amount of the assets was measured using value in use with a\n\npre-tax\n\ndiscount rate of\n13.0\n%.\n\nFor the fiscal year\n\n ended March 31, 2026, considering the business environment, Sony decided to wind down the businesses operated by Pixo Holdings, Inc., a wholly-owned subsidiary of Sony within the Pictures segment, and its consolidated subsidiaries (collectively, “Pixomondo”), while completing any outstanding contractual obligations. As a result, Sony determined that\n th\ne\nre was\n\n \n\nno\nrecoverable amount\nf\n\nor\n\n \n\nPixomondo’s non-financial assets\n,\n including property, plant\n \n\nand equipment of\n5,171\nmillion yen,\n\nROU\n\nassets of\n640\nmillion yen, goodwill of\n14,355\nmillion yen and other intangible assets of\n1,944\nmillion yen\n,\n and accordingly recognized impairment losses of\n22,110\nmillion yen in other operating (income) expenses, net.\n\nThere were no material impairment losses for the fiscal years ended March 31, 2024 and 2025.\n\n \n\n13.\n\nInsurance contracts in the Financial Services business\n\n \n\n(1)\n\nSignificant judgments and estimates for insurance contracts\n\nAs a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, figures in this section are presented only as of March 31, 2025, September 30, 2025 or for the fiscal year ended March 31, 2025.\n\n \n\ni)\n\nMeasurement methods and inputs for insurance contracts\n\nThe methods and main inputs used to measure insurance contracts are as follows:\n\n \n\n \n\n  \n\n  Weighted average (%)  \n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n  2025  \n\n \n\nMortality rates\n\n  \n \n1.03\n% \n\nLapse and surrender rates\n\n  \n \n3.80\n% \n\nSony estimates the mortality and morbidity rates based on the historical and most recent actual outcomes and analyzes the historical experience and trends in data using statistical methods. When estimating the mortality and morbidity rates for each group of insurance contracts, Sony takes into account the characteristics of policyholders including gender, health conditions and smoking habits and the characteristics of the group of insurance contracts such as the selective effects over time. The estimates are revised in a timely manner to reflect changes in lifestyle, as well as changes in social conditions such as improvement of mortality and morbidity rates in the future.\n\nSony estimates the lapse and surrender rates based on the historical and most recent actual outcomes and determines the probability-weighted lapse and surrender rates for each group of insurance contracts by analyzing historical experience and trends in data using statistical methods. Lapse and surrender rates are estimated, taking into account both ordinary and dynamic lapses, and reflect the tendency to higher surrender rates when the yield on contracts increases or exceeds the guaranteed minimum for certain insurance contracts. In determining the lapse and surrender rates, historical actual data is considered. If there is no or little historical actual data, the actual results of similar products as well as domestic and overseas practical trends are used as reference.\n\nSony projects estimates of future expenses based on the current expense levels. The expenses comprise expenses directly attributable to the group of insurance contracts, including the allocation of fixed and variable overhead expenses. In addition, Sony applies inflation adjustments to the estimated expenses in future.\n\n \n\nF-60\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nii)\n\nDiscretionary participation features of future cash flows\n\nFor certain participating insurance contracts other than direct participating contracts, the effect of discretionary changes on the fulfillment cash flows is adjusted in the CSM. Although Sony has discretionary participation features related to the investment policy for these contracts, the investment policy is established based on the market conditions. Therefore, the effect of changes in assumptions that relate to financial risk on the investment policy is included in insurance finance income or expenses. In addition, since the dividend policy can be changed at Sony’s discretion, the effect of changes in the dividend policy on the fulfillment cash flows is adjusted in the CSM.\n\n \n\niii)\n\nRisk adjustments for\nnon-financial\nrisk\n\nRisk adjustments for\nnon-financial\nrisk are determined to reflect the compensation that each insurance subsidiary would require for bearing\nnon-financial\nrisk, and are allocated to groups of insurance contracts based on an analysis of the risk profiles of the groups. Risk adjustments for\nnon-financial\nrisk reflect the diversification benefits, in a way that is consistent with the compensation that the insurance company would require and that reflects its degree of risk aversion.\n\nThe risk adjustments for\nnon-financial\nrisk are determined mainly using a cost of capital technique. In applying a cost of capital technique, Sony determines the risk adjustment for\nnon-financial\nrisk by applying a\ncost-of-capital\n rate to the amount of capital required for each future reporting date and discounting the result using risk-free rates adjusted for illiquidity. The required capital is determined by estimating the probability distribution of the present value of future cash flows from insurance contracts at each future reporting date and calculating the capital that Sony would require to meet its contractual obligations to pay\n\n claims and expenses at a 99.5% confidence level for one year. The\n\ncost-of-capital\n\nrate represents the additional reward that investors require for exposure to the\nnon-financial\nrisk. The weighted average\n\ncost-of-capital\n\nrates of Sony for the fiscal year ended March 31, 2025 was 3.0%.\n\nIn addition, the risk adjustments determined by applying a cost of capital technique for the fiscal year ended March 31, 2025 correspond to the confidence level of 81.3% (time horizon: the life of the insurance contracts).\n\niv)\n\nDiscount rates\n\nAll cash flows are discounted using risk-free yield curves adjusted to reflect the characteristics of the cash flows and the liquidity of the insurance contracts. Sony determines the risk-free yield curves using the yields on government bonds. The yield curve is determined by incorporating long-term real interest rate and inflation expectations. Regarding extrapolation for the periods in which market data is not available, a method using an ultimate forward rate is applied. Specifically, Sony uses an ultimate forward rate of 3.5% and starts extrapolation in the 40th year (or the 30th year for U.S. dollar). The forward rates for the 41st year (or the 31st year for U.S. dollar) and onwards are extrapolated so that they will converge to the level of the ultimate forward rate in 30 years, using the Smith-Wilson method. To reflect the liquidity characteristics of the insurance contracts, the risk-free yield curves are adjusted by an illiquidity premium. Illiquidity premiums are determined by setting up a reference portfolio of Sony’s assets.\n\nThe table below sets out the yield curves used to discount the cash flows of insurance contracts for major currencies (converted at the spot rate). As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, accumulated other comprehensive income related to insurance finance income (expenses) at the time of the execution was transferred to net income (loss) from discontinued operations as a loss in the consolidated statements of income. Therefore, yield curves are presented as of September 30, 2025.\n\n \n\n \n  \n\nYield curve (%)\n\n \n\n \n  \n\nMarch 31\n\n \n \n\nSeptember 30\n\n \n\n \n  \n\n2025\n\n \n \n\n2025\n\n \n\nTerm\n\n  \n\n JPY \n\n \n \n\n USD \n\n \n \n\n JPY \n\n \n \n\n USD \n\n \n\n1 year\n\n  \n \n0.65\n% \n \n \n4.09\n% \n \n \n0.81\n% \n \n \n3.68\n% \n\n5 years\n\n  \n \n1.13\n% \n \n \n4.01\n% \n \n \n1.26\n% \n \n \n3.81\n% \n\n10 years\n\n  \n \n1.54\n% \n \n \n4.31\n% \n \n \n1.70\n% \n \n \n4.27\n% \n\n20 years\n\n  \n \n2.34\n% \n \n \n4.83\n% \n \n \n2.82\n% \n \n \n5.00\n% \n\n30 years\n\n  \n \n2.69\n% \n \n \n4.68\n% \n \n \n3.47\n% \n \n \n4.92\n% \n\n40 years\n\n  \n \n3.02\n% \n \n \n4.29\n% \n \n \n3.91\n% \n \n \n4.50\n% \n\n \n\nv)\n\nInvestment components\n\nSony identifies the investment component of an insurance contract by determining the amount that it is required to repay to the policyholder in all circumstances, regardless of whether an insured event occurs or not. These include circumstances in which an insured event occurs, or the contract matures or is terminated without an insured event occurring. Investment components are excluded from insurance revenue and insurance service expenses.\n\n \n\nvi)\n\nDetermination of coverage units\n\nThe amount of the CSM of a group of insurance contracts that is recognized as insurance revenue in each period is determined by identifying the coverage units in the group and recognizing in profit or loss the amount of the CSM allocated to\n\n \n\nF-61\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nthe coverage units provided during the current period. The number of coverage units is determined by considering for each contract the quantity of benefits provided and its expected coverage period. Specifically, Sony determines the quantity of benefits based on:\n\n \n\n \n\n-\n\n \n\nthe death benefit amount in the case of contracts for which the death benefit amount increases or decreases based on the period (e.g., whole life, term life and variable life insurance contracts);\n\n \n\n \n\n-\n\n \n\nthe premium amount proportionate to the insurance period in the case of contracts whose host contract and riders have different coverage types (e.g., disease and health insurance contracts); and\n\n \n\n \n\n-\n\n \n\nthe cash surrender value (or the premium reserve during the annuity payment period) in the case of annuity contracts with investment-related services (e.g., individual variable annuity contracts).\n\nSony considers the characteristics of insurance contracts and aggregates the quantities of benefits related to insurance coverage, investment-return services and investment-related services when determining the relative weighting of the benefits provided to the policyholder by these services.\n\n \n\nvii)\n\nClaim development\n\nGiven that the actual amounts of claims do not materially differ from the undiscounted amounts of the claims previously estimated, information about claim development has not been disclosed for the fiscal year ended March 31, 2025.\n\n \n\nF-62\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\n(2)\n\nReconciliation of insurance contract liabilities\n\nThe tables below show the changes in insurance contract liabilities for the fiscal years ended March 31, 2025 and 2026.\n\n \n\n(a)\n\nChanges in liabilities for remaining coverage and liabilities for incurred claims\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nLiability for remaining coverage\n\n \n\n \n\n \n\n \n\n  \n\nLiability for\nincurred claims\n*5\n\n \n\n \n\nTotal\n\n \n\n \n\n  \n\nExcluding loss\ncomponent\n\n \n\n \n\n \n\n \n\n  \n\nLoss\ncomponent\n\n \n\n \n\n \n\n \n\nBalance as of April 1, 2024\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\nInsurance contract assets\n*1\n\n  \n \n(90,377\n) \n \n\n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n33,402\n \n \n \n(56,975\n) \n\nInsurance contract liabilities\n*2*3\n\n  \n \n12,900,023\n \n \n \n \n \n  \n \n55,333\n \n \n\n \n  \n \n138,983\n \n \n \n13,094,339\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet amounts\n\n  \n \n12,809,646\n \n \n \n \n \n  \n \n55,333\n \n \n\n \n  \n \n172,385\n \n \n \n13,037,364\n \n\nInsurance revenue\n\n  \n \n(622,959\n) \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n(622,959\n) \n\nInsurance service expenses\n\n  \n\n \n \n \n \n  \n\n \n\n \n  \n\n \n\nIncurred claims and other insurance service expenses\n\n  \n \n-\n \n \n \n \n \n  \n \n(5,882\n) \n \n\n \n  \n \n304,059\n \n \n \n298,177\n \n\nAmortization of insurance acquisition cash flows\n\n  \n \n134,818\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n134,818\n \n\nChanges in liabilities for incurred claims\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n5,661\n \n \n \n5,661\n \n\nLosses and reversals of losses on onerous contracts\n\n  \n \n-\n \n \n \n \n \n  \n \n14,276\n \n \n\n \n  \n \n-\n \n \n \n14,276\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal insurance service expenses\n\n  \n \n134,818\n \n \n \n \n \n  \n \n8,394\n \n \n\n \n  \n \n309,720\n \n \n \n452,932\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInsurance service result\n\n  \n \n(488,141\n) \n \n \n \n \n  \n \n8,394\n \n \n\n \n  \n \n309,720\n \n \n \n(170,027\n) \n\nInsurance finance expenses (income)\n\n  \n \n(631,892\n) \n \n \n \n \n  \n \n(498\n) \n \n\n \n  \n \n(2,415\n) \n \n \n(634,805\n) \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal amounts recognized in comprehensive income\n\n  \n \n(1,120,033\n) \n \n \n \n \n  \n \n7,896\n \n \n\n \n  \n \n307,305\n \n \n \n(804,832\n) \n\nInvestment component excluded from insurance revenue and insurance service expenses\n\n  \n \n(992,966\n) \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n992,966\n \n \n \n-\n \n\nCash flows\n\n  \n\n \n \n \n \n  \n\n \n\n \n  \n\n \n\nPremiums received\n\n  \n \n2,056,493\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n2,056,493\n \n\nInsurance acquisition cash flows\n\n  \n \n(167,299\n) \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n(167,299\n) \n\nClaims and other insurance service expenses paid\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n(1,298,150\n) \n \n \n(1,298,150\n) \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal cash flows\n\n  \n \n1,889,194\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n(1,298,150\n) \n \n \n591,044\n \n\nOther\n\n  \n \n(68\n) \n \n \n \n \n  \n \n(46\n) \n \n\n \n  \n \n(539\n) \n \n \n(653\n) \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n\n \n \n \n \n  \n\n \n\n \n  \n\n \n\nInsurance contract assets\n*1\n\n  \n \n(81,537\n) \n \n \n \n \n  \n \n2\n \n \n\n \n  \n \n33,820\n \n \n \n(47,715\n) \n\nInsurance contract liabilities\n*2*3\n\n  \n \n12,667,310\n \n \n \n \n \n  \n \n63,181\n \n \n\n \n  \n \n140,147\n \n \n \n12,870,638\n \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet amounts\n\n  \n \n12,585,773\n \n \n \n \n \n  \n \n63,183\n \n \n\n \n  \n \n173,967\n \n \n \n12,822,923\n \n\nInsurance revenue\n\n  \n \n(332,024\n)\n \n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n(332,024\n)\n\nInsurance service expenses\n\n  \n\n \n \n \n \n  \n\n \n\n \n  \n\n \n\nIncurred claims and other insurance service expenses\n\n  \n \n-\n \n \n \n \n \n  \n \n(3,215\n) \n \n\n \n  \n \n152,470\n \n \n \n149,255\n \n\nAmortization of insurance acquisition cash flows\n\n  \n \n70,418\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n70,418\n \n\nChanges in liabilities for incurred claims\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n1,327\n \n \n \n1,327\n \n\nLosses and reversals of losses on onerous contracts\n\n  \n \n-\n \n \n \n \n \n  \n \n10,950\n \n \n\n \n  \n \n-\n \n \n \n10,950\n \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal insurance service expenses\n\n  \n \n70,418\n \n \n \n \n \n  \n \n7,735\n \n \n\n \n  \n \n153,797\n \n \n \n231,950\n \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nInsurance service result\n\n  \n \n(261,606\n)\n \n \n \n \n \n \n  \n \n7,735\n \n \n\n \n  \n \n153,797\n \n \n \n(100,074\n) \n\nInsurance finance expenses (income)\n\n  \n \n(141,098\n) \n \n \n \n \n  \n \n(300\n) \n \n\n \n  \n \n(118\n) \n \n \n(141,516\n) \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal amounts recognized in comprehensive income\n\n  \n \n(402,704\n) \n \n \n \n \n  \n \n7,435\n \n \n\n \n  \n \n153,679\n \n \n \n(241,590\n) \n\nInvestment component excluded from insurance revenue and insurance service expenses\n\n  \n \n(444,430\n) \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n444,430\n \n \n \n-\n \n\nCash flows\n\n  \n\n \n\n  \n\n \n\n  \n\n \n\nPremiums received\n\n  \n \n976,117\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n976,117\n \n\nInsurance acquisition cash flows\n\n  \n \n(85,130\n) \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n(85,130\n) \n\nClaims and other insurance service expenses paid\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n(596,808\n) \n \n \n(596,808\n) \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal cash flows\n\n  \n \n890,987\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n(596,808\n) \n \n \n294,179\n \n\nOther\n\n  \n \n(2,186\n) \n \n \n \n \n  \n \n1,159\n \n \n\n \n  \n \n(81\n) \n \n \n(1,108\n) \n\nImpact from loss of control of the Financial Services business\n*4\n\n  \n \n(12,627,440\n) \n \n \n \n \n  \n \n(71,777\n) \n \n\n \n  \n \n(175,187\n) \n \n \n(12,874,404\n) \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n\n \n \n \n \n  \n\n \n\n \n  \n\n \n\nInsurance contract assets\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n-\n \n\nInsurance contract liabilities\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n-\n \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet amounts\n\n  \n \n-\n \n \n \n \n \n  \n \n-\n \n \n\n \n  \n \n-\n \n \n \n-\n \n\n  \n\n \n\n \n\n \n \n \n \n \n  \n\n \n\n \n\n \n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n*1\n\nInsurance contract assets are included in other current assets or other\nnon-current\nassets in the consolidated statements of financial position.\n\n \n\n*2\n\nThe current portion of insurance contract liabilities is included in other current liabilities in the consolidated statements of financial position.\n\n \n\n*3\n\nAs of April 1, 2024 and March 31, 2025, the carrying amounts of the current portion of insurance contract liabilities were 162,344 million yen and 181,332 million yen, respectively, and the carrying amounts of the\nnon-current\nportion of insurance contract liabilities were 12,931,995 million yen and 12,689,306 million yen, respectively.\n\n \n\n*4\n\nAmount as of the date of deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\n*5\n\nRisk adjustment for\nnon-financial\nrisk of insurance contracts measured under the PAA is not presented separately from the estimates of the present value of future cash flows but included in liabilities for incurred claims, since the amount is not considered material.\n\n \n\nF-6\n\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(b)\n\nChanges in insurance contract liabilities from insurance contracts not measured under the PAA by measurement component\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nEstimates of\npresent value\nof future\ncash flows\n\n \n \n \n \n \n\nRisk adjustment\n\nfor non-financial\n\nrisk\n\n \n \n \n \n \n\nCSM\n\n \n \n \n \n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInsurance contract assets\n\n \n \n(291,878\n) \n \n\n \n \n27,824\n \n \n\n \n \n207,079\n \n \n\n \n \n(56,975\n) \n\nInsurance contract liabilities\n\n \n \n10,697,166\n \n \n\n \n \n388,658\n \n \n\n \n \n1,901,009\n \n \n\n \n \n12,986,833\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nNet amounts\n\n \n \n10,405,288\n \n \n\n \n \n416,482\n \n \n\n \n \n2,108,088\n \n \n\n \n \n12,929,858\n \n\nChanges that relate to future service\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChanges in estimates that adjust the CSM\n\n \n \n276,707\n \n \n\n \n \n10,662\n \n \n\n \n \n(287,369\n) \n \n\n \n \n-\n \n\nChanges in estimates that do not adjust the CSM\n\n \n \n11,762\n \n \n\n \n \n746\n \n \n\n \n \n-\n \n \n\n \n \n12,508\n \n\nEffect of contracts initially recognized during the period\n\n \n \n(431,801\n) \n \n\n \n \n44,335\n \n \n\n \n \n389,234\n \n \n\n \n \n1,768\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal changes that relate to future service\n\n \n \n(143,332\n) \n \n\n \n \n55,743\n \n \n\n \n \n101,865\n \n \n\n \n \n14,276\n \n\nChanges that relate to current service\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCSM recognized in profit or loss for the services provided\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(151,025\n) \n \n\n \n \n(151,025\n) \n\nChange in risk adjustment for\nnon-financial\nrisk due to release of risk\n\n \n \n-\n \n \n\n \n \n(28,681\n) \n \n\n \n \n-\n \n \n\n \n \n(28,681\n) \n\nExperience adjustments\n\n \n \n656\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n656\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal changes that relate to current service\n\n \n \n656\n \n \n\n \n \n(28,681\n) \n \n\n \n \n(151,025\n) \n \n\n \n \n(179,050\n) \n\nChanges that relate to past service\n\n \n \n6\n \n \n\n \n \n(6\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nInsurance service result\n\n \n \n(142,670\n) \n \n\n \n \n27,056\n \n \n\n \n \n(49,160\n) \n \n\n \n \n(164,774\n) \n\nInsurance finance expenses (income)\n\n \n \n(661,734\n) \n \n\n \n \n(2,250\n) \n \n\n \n \n30,155\n \n \n\n \n \n(633,829\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal amounts recognized in comprehensive income\n\n \n \n(804,404\n) \n \n\n \n \n24,806\n \n \n\n \n \n(19,005\n) \n \n\n \n \n(798,603\n) \n\nCash flows\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPremiums received\n\n \n \n1,894,792\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n1,894,792\n \n\nInsurance acquisition cash flows\n\n \n \n(151,614\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(151,614\n) \n\nClaims and other insurance service expenses paid\n\n \n \n(1,179,036\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(1,179,036\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal cash flows\n\n \n \n564,142\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n564,142\n \n\nOther\n\n \n \n2,883\n \n \n\n \n \n643\n \n \n\n \n \n(1,334\n) \n \n\n \n \n2,192\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInsurance contract assets\n\n \n \n(245,602\n) \n \n\n \n \n24,501\n \n \n\n \n \n173,386\n \n \n\n \n \n(47,715\n) \n\nInsurance contract liabilities\n\n \n \n10,413,511\n \n \n\n \n \n417,430\n \n \n\n \n \n1,914,363\n \n \n\n \n \n12,745,304\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nNet amounts\n\n \n \n10,167,909\n \n \n\n \n \n441,931\n \n \n\n \n \n2,087,749\n \n \n\n \n \n12,697,589\n \n\nChanges that relate to future service\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nChanges in estimates that adjust the CSM\n\n \n \n14,984\n \n \n\n \n \n47,569\n \n \n\n \n \n(62,553\n) \n \n\n \n \n-\n \n\nChanges in estimates that do not adjust the CSM\n\n \n \n6,908\n \n \n\n \n \n2,569\n \n \n\n \n \n-\n \n \n\n \n \n9,477\n \n\nEffect of contracts initially recognized during the period\n\n \n \n(177,699\n) \n \n\n \n \n21,537\n \n \n\n \n \n157,636\n \n \n\n \n \n1,474\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal changes that relate to future service\n\n \n \n(155,807\n) \n \n\n \n \n71,675\n \n \n\n \n \n95,083\n \n \n\n \n \n10,951\n \n\nChanges that relate to current service\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCSM recognized in profit or loss for the services provided\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(79,908\n) \n \n\n \n \n(79,908\n) \n\nChange in risk adjustment for\nnon-financial\nrisk due to release of risk\n\n \n \n-\n \n \n\n \n \n(16,164\n) \n \n\n \n \n-\n \n \n\n \n \n(16,164\n) \n\nExperience adjustments\n\n \n \n(7,549\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(7,549\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal changes that relate to current service\n\n \n \n(7,549\n) \n \n\n \n \n(16,164\n) \n \n\n \n \n(79,908\n) \n \n\n \n \n(103,621\n) \n\nChanges that relate to past service\n\n \n \n324\n \n \n\n \n \n(5\n) \n \n\n \n \n-\n \n \n\n \n \n319\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nInsurance service result\n\n \n \n(163,032\n) \n \n\n \n \n55,506\n \n \n\n \n \n15,175\n \n \n\n \n \n(92,351\n) \n\nInsurance finance expenses (income)\n\n \n \n(152,695\n) \n \n\n \n \n(1,373\n) \n \n\n \n \n12,465\n \n \n\n \n \n(141,603\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal amounts recognized in comprehensive income\n\n \n \n(315,727\n) \n \n\n \n \n54,133\n \n \n\n \n \n27,640\n \n \n\n \n \n(233,954\n) \n\nCash flows\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPremiums received\n\n \n \n893,895\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n893,895\n \n\nInsurance acquisition cash flows\n\n \n \n(77,407\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(77,407\n) \n\nClaims and other insurance service expenses paid\n\n \n \n(520,614\n) \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n(520,614\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nTotal cash flows\n\n \n \n295,874\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n295,874\n \n\nOther\n\n \n \n(12,883\n) \n \n\n \n \n-\n \n \n\n \n \n(1,207\n) \n \n\n \n \n(14,090\n) \n\nImpact from loss of control of the Financial Services business\n*1\n\n \n \n(10,135,173\n) \n \n\n \n \n(496,064\n) \n \n\n \n \n(2,114,182\n) \n \n\n \n \n(12,745,419\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInsurance contract assets\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\nInsurance contract liabilities\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nNet amounts\n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n \n\n \n \n-\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n \n\n*1\n\nAmount as of the date of deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\nF-6\n\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(3)\n\nEffect of contracts initially recognized in the year\n\nThe table below shows the effect of contracts initially recognized during the fiscal year ended March 31, 2025 on measurement components of insurance contracts not measured under the PAA. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, figures are presented only for the fiscal year ended March 31, 2025.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n2025\n\n \n\n \n \n\nProfitable\ncontracts\nissued\n\n \n \n\nOnerous\ncontracts\nissued\n\n \n \n\nTotal\n\n \n\nEstimates of the present value of future cash outflows\n\n \n\n \n\n \n\nClaims and other insurance service expenses\n\n \n \n2,227,649\n \n \n \n6,376\n \n \n \n2,234,025\n \n\nInsurance acquisition cash flows\n\n \n \n155,135\n \n \n \n2,735\n \n \n \n157,870\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal estimates of the present value of future cash outflows\n\n \n \n2,382,784\n \n \n \n9,111\n \n \n \n2,391,895\n \n\nEstimates of the present value of future cash inflows\n\n \n \n(2,816,078\n) \n \n \n(7,618\n) \n \n \n(2,823,696\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal estimates of the present value of future cash flows\n\n \n \n(433,294\n) \n \n \n1,493\n \n \n \n(431,801\n) \n\nRisk adjustment for\nnon-financial\nrisk\n\n \n \n44,060\n \n \n \n275\n \n \n \n44,335\n \n\nCSM\n\n \n \n389,234\n \n \n \n-\n \n \n \n389,234\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal effect on measurement components\n\n \n \n-\n \n \n \n1,768\n \n \n \n1,768\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n(4)\n\nTiming of when the CSM is expected to be recognized in profit or loss\n\nThe table below shows when Sony expects to recognize the CSM in profit or loss for insurance contracts not measured under the PAA as of March 31, 2025. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, figures are presented only as of March 31, 2025.\n\n \n\n \n \n\nCSM\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nWithin\n\n1 year\n\n \n \n\n1 year\nto 2 years\n\n \n \n\n2 years\nto 3 years\n\n \n \n\n3 years\nto 4 years\n\n \n \n\n4 years\nto 5 years\n\n \n \n\n5 years\nto 10 years\n\n \n \n\nMore than\n10 years\n\n \n \n\nTotal\n\n \n\nAs of March 31, 2025\n\n \n \n122,591\n \n \n \n114,961\n \n \n \n107,412\n \n \n \n97,307\n \n \n \n89,960\n \n \n \n362,794\n \n \n \n1,192,724\n \n \n \n2,087,749\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n(5)\n\nUnderlying items of insurance contracts measured under the variable fee approach\n\nThe table below shows the underlying items of insurance contracts measured under the variable fee approach and their fair values as of March 31, 2025. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, figures are presented only as of March 31, 2025.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31\n\n \n\n \n \n\n2025\n\n \n\nCash and cash equivalents\n\n \n \n35,235\n \n\nDebt securities\n\n \n\nJapanese national/local government bonds and corporate bonds\n\n \n \n34,936\n \n\nForeign national/local government bonds and corporate bonds\n\n \n \n478,751\n \n\nEquity securities\n\n \n \n2,375,201\n \n\nOther\n\n \n \n2,057\n \n\n \n\n \n\n \n\n \n\nTotal fair values of the underlying items of insurance contracts measured under the variable fee approach\n\n \n \n   2,926,180\n \n\n \n\n \n\n \n\n \n\n(6)\n\nDisclosure of transition to IFRS 17\n\nIFRS 17 was effective for Sony as of April 1, 2023. Upon transition to IFRS 17 as of April 1, 2022, Sony determined that it would be impracticable to apply the full retrospective approach to certain groups of insurance contracts, as the necessary information was unavailable due to restrictions of contract data and systems in the past or it was impossible to recreate past estimation without the use of hindsight. Sony has applied alternative transition methods (the modified retrospective approach\n\n \n\nF-6\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nor the fair value approach) to groups of insurance contracts for which the full retrospective approach is impracticable as of the date of the transition.\n\nSony has applied the following approaches on transition to IFRS 17:\n\n \n\nYear of issue (fiscal year)\n\n \n\nTransition approach\n\n2015 and thereafter\n\n \n\nFor all groups of insurance contracts: Full retrospective approach\n\n1993 – 2014\n\n \n\nFor groups of insurance contracts with direct participation features and certain groups of insurance contracts without direct participation features: Fair value approach\n\n \n\nFor other groups of insurance contracts: Modified retrospective approach\n\nIn and before 1992\n\n \n\nFor all groups of insurance contracts: Fair value approach\n\nModified retrospective approach\n\nThe objective of the modified retrospective approach was to achieve the closest outcome to retrospective application possible using reasonable and supportable information available without undue cost or effort. Sony has applied each of the following modifications only to the extent that it did not have reasonable and supportable information to apply IFRS 17 retrospectively.\n\nSony has applied the following modifications to certain groups of insurance contracts:\n\n \n\n \n-\n\nfor groups of contracts issued, initiated or acquired from April 1, 1993 to March 31, 2015, the future cash flows on initial recognition were estimated by adjusting the amount as of April 1, 2015, which can be determined retrospectively, for the cash flows that were known to have occurred before that date;\n\n \n\n \n-\n\nfor groups of contracts issued, initiated or acquired from April 1, 1993 to March 31, 2013, the illiquidity premiums applied to the observable risk-free yield curves on initial recognition were estimated by determining an average spread between the observable risk-free yield curves and the discount rates, which can be determined retrospectively, for the period from April 1, 2013 to March 31, 2022. The amount of insurance finance income or expenses recognized in accumulated other comprehensive income as of April 1, 2022 was calculated by using this discount rate; and\n\n \n\n \n-\n\nthe risk adjustment for\nnon-financial\nrisk on initial recognition was determined by adjusting the amount as of April 1, 2022 for the expected release of risk before that date.\n\nAfter applying such modifications to fulfillment cash flows, the CSM (or the loss component) on initial recognition was determined as follows:\n\n \n\n \n-\n\nthe amount of the CSM recognized as profit or loss before April 1, 2022 was determined by comparing the remaining coverage units as of April 1, 2022 and the coverage units provided based on groups of insurance contracts before that date; and\n\n \n\n \n-\n\nthe amount allocated to the loss component before April 1, 2022 was determined using the proportion of the loss component relative to the total estimate of the present value of the future cash outflows plus the risk adjustment for\nnon-financial\nrisk on initial recognition.\n\nFair value approach\n\nUnder the fair value approach, the CSM (or the loss component) as of April 1, 2022 was determined as the difference between the fair value of a group of insurance contracts and the fulfillment cash flows at that date.\n\nFor all insurance contracts measured under the fair value approach, Sony used reasonable and supportable information available as of April 1, 2022 to determine the following matters:\n\n \n\n \n\n-\n\nhow to identify groups of contracts;\n\n \n\n \n\n-\n\nwhether a contract meets the definition of an insurance contract with direct participation features; and\n\n \n\n \n\n-\n\nhow to identify discretionary cash flows for contracts without direct participation features.\n\nFor groups of contracts measured under the fair value approach, the discount rates on initial recognition were determined as of April 1, 2022 rather than at the date of initial recognition.\n\nFor all insurance contracts measured under the fair value approach, the amount of insurance finance income or expenses recognized in accumulated in other comprehensive income as of April 1, 2022 was determined to be zero.\n\nThe effects of transition to IFRS 17 on Sony’s consolidated financial statements are as follows. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, figures are presented only for the fiscal year ended March 31, 2025.\n\n \n\nF-6\n\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\ni)\n\nThe CSM by transition approach\n\nUpon transition to IFRS 17, Sony applied either the modified retrospective approach or the fair value approach for groups of insurance contracts where it was impracticable to fully apply IFRS 17 retrospectively. The table below shows the balances of the CSM by transition approach as of March 31, 2025.\n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2025\n\n \n\n \n  \n\nContracts\nmeasured\nunder the\nmodified\nretrospective\napproach at\ntransition\n\n \n \n\nContracts\nmeasured\nunder the\nfair value\n\napproach at\ntransition\n\n \n \n\nNew contracts\nand contracts\nmeasured\nunder the full\nretrospective\napproach at\ntransition\n\n \n \n\nTotal\n\n \n\nCSM\n\n  \n\n \n\n \n\n \n\nBeginning balance of the fiscal year\n\n  \n \n763,669\n \n \n \n86,271\n \n \n \n1,258,148\n \n \n \n2,108,088\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges that relate to future service\n\n  \n \n(89,828\n) \n \n \n556\n \n \n \n191,137\n \n \n \n101,865\n \n\nChanges that relate to current service\n\n  \n \n(55,642\n) \n \n \n(7,020\n) \n \n \n(88,363\n) \n \n \n(151,025\n) \n\nInsurance finance expense (income)\n\n  \n \n23,501\n \n \n \n781\n \n \n \n5,873\n \n \n \n30,155\n \n\nOther\n\n  \n \n(1,090\n) \n \n \n-\n \n \n \n(244\n) \n \n \n(1,334\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nEnding balance of the fiscal year\n\n  \n \n 640,610\n \n \n \n  80,588\n \n \n \n1,366,551\n \n \n \n 2,087,749\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nii)\n\nChanges in accumulated other comprehensive income for financial assets measured at fair value through other comprehensive income due to the application of IFRS 17\n\nThe table below shows the changes in accumulated other comprehensive income during the fiscal year ended March 31, 2025 for financial assets measured at fair value through other comprehensive income, among investment assets related to groups of insurance contracts to which Sony applied the modified retrospective approach or the fair value approach as of the date of the transition.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n\nBeginning balance of the fiscal year\n\n  \n \n9,445\n \n\n  \n\n \n\n \n\n \n\nNet change in fair value\n\n  \n \n    778,509\n \n\nNet amount reclassified to profit or loss\n\n  \n \n1,142\n \n\nRelated income tax\n\n  \n \n(225,613\n) \n\n  \n\n \n\n \n\n \n\nEnding balance of the fiscal year\n\n  \n \n563,483\n \n\n  \n\n \n\n \n\n \n\n \n\n(7)\n\nInsurance and market risks\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, each risk related to the Financial Services business is presented only as of March 31, 2025.\n\nRisk management policy and exposure\n\nIn the life insurance business, Sony manages various market-related risks in the following manner:\n\n \n\n(a)\n\nInsurance risk management\n\nInsurance risk\n\nWith respect to insurance underwriting risk, based on the level of policy reserves and capital levels, the life insurance subsidiary manages the insurance portfolio appropriately, such as setting policy limits for each type of insurance as necessary. In addition, underwriting standards for each product and standards for revision and abolishment are clearly defined as internal rules and are regularly reviewed.\n\nConcentration of insurance risk\n\nThe insurance contract portfolio does not have an excessively concentrated insurance risk.\n\n \n\nF-\n6\n\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(b)\n\nMarket risk management\n\nInterest rate risk management\n\nInterest rate risk is managed by the risk management division of the life insurance subsidiary based on the policies for interest rate risk management that specify details such as risk management methods and procedures. Based on ALM policies that are determined through such methods as deliberation by the life insurance subsidiary’s Executive Committee, the subsidiary understands and confirms actual risk conditions with its Board of Directors. The division maintains an overall understanding of the interest rates and durations of financial instruments, monitors them based on the analysis of the quantity of risk using VaR, and periodically reports the status of each risk to the life insurance subsidiary’s Board of Directors and Executive Committee.\n\nAs part of the ALM management, the life insurance subsidiary invests in financial assets that match the characteristics of the insurance contract obligations, and thereby reduces interest rate risk as much as possible. Through the purchase and sale of financial assets included in their portfolio, the interest rate sensitivity (duration) of financial assets and insurance contract obligations is matched as much as possible so that they ensure sufficient cash flow to settle insurance claims as they come due.\n\nExchange rate risk management\n\nExchange rate risk is managed by the risk management division of the life insurance subsidiary based on the policies for exchange rate risk management that specify details such as risk management methods and procedures. The division periodically reports the status of each risk to the life insurance subsidiary’s Board of Directors and Executive Committee.\n\nEquity market price fluctuation risk management\n\nEquity market price fluctuation risk is managed by the risk management division of the life insurance subsidiary based on the policies for equity market price fluctuation risk management that specify details such as risk management methods and procedures. The division periodically reports the status of each risk to the life insurance subsidiary’s Board of Directors and Executive Committee.\n\nDerivative transactions risk management\n\nDerivative transactions are managed by the risk management division of the life insurance subsidiary based on the policies for derivative transactions that specify details such as risk management methods and procedures. The division periodically reports the status of each risk to the life insurance subsidiary’s Board of Directors and Executive Committee.\n\n \n\nF-6\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\nSensitivity analysis\n\nMarket risk\n\nThe table below shows the effects on net income before income taxes from discontinued operations and equity as of March 31, 2025 if the underlying assumptions of the insurance contracts and financial instruments which Sony has in the life insurance business had changed.\n\n \n\n \n\n \n\n \n\n \n\nMarch 31, 2025\n\n \n\n \n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\nInsurance contracts\n\n \n\n \n\nFinancial\n\ninstruments\n\n \n\n \n\nTotal\n\n \n\nAssumption\n\n \n\nChanges in assumptions, etc.\n\n \n\nIncome\n\nbefore\nincome\ntaxes\n\nfrom\n\ndiscontinued\n\noperations\n\n \n\n \n\nEquity\n\n \n\n \n\nIncome\n\nbefore\nincome\ntaxes\n\nfrom\n\ndiscontinued\n\noperations\n\n \n\n \n\nEquity\n\n \n\n \n\nIncome\n\nbefore\nincome\ntaxes\n\nfrom\n\ndiscontinued\n\noperations\n\n \n\n \n\nEquity\n\n \n\nInterest rates\n\n \n50bp decrease\n \n \n(96,388\n) \n \n \n(489,064\n) \n \n \n98,806\n \n \n \n620,061\n \n \n \n2,418\n \n \n \n130,997\n \n\n \n50bp increase\n \n \n69,393\n \n \n \n413,835\n \n \n \n(87,517\n) \n \n \n(546,554\n) \n \n \n(18,124\n) \n \n \n(132,719\n) \n\nFair value of stocks\n\n \n10% decrease\n \n \n404,020\n \n \n \n290,894\n \n \n \n(412,232\n) \n \n \n(297,160\n) \n \n \n(8,212\n) \n \n \n(6,266\n) \n\n \n10% increase\n \n \n(407,812\n) \n \n \n(293,625\n) \n \n \n412,232\n \n \n \n297,160\n \n \n \n4,420\n \n \n \n3,535\n \n\nForeign exchange rates\n\n \n10% appreciation of the Yen\n \n \n539,518\n \n \n \n366,832\n \n \n \n(546,899\n) \n \n \n(339,178\n) \n \n \n(7,381\n) \n \n \n27,654\n \n\n \n10% depreciation of the Yen\n \n \n(543,155\n) \n \n \n(369,450\n) \n \n \n546,899\n \n \n \n339,178\n \n \n \n3,744\n \n \n \n(30,272\n) \n\nMaintenance expenses rates\n\n \n10% increase\n \n \n(4,313\n) \n \n \n(5,390\n) \n \n \n-\n \n \n \n-\n \n \n \n(4,313\n) \n \n \n(5,390\n) \n\nLapse and surrender rates\n\n \n10% increase\n \n \n(23,254\n) \n \n \n(34,971\n) \n \n \n-\n \n \n \n-\n \n \n \n(23,254\n) \n \n \n(34,971\n) \n\nMortality rates (death protection)\n\n \n5% increase\n \n \n(4,838\n) \n \n \n(4,710\n) \n \n \n-\n \n \n \n-\n \n \n \n(4,838\n) \n \n \n(4,710\n) \n\nMortality rates (third sector / annuity products)\n\n \n5% increase\n \n \n960\n \n \n \n(467\n) \n \n \n-\n \n \n \n-\n \n \n \n960\n \n \n \n(467\n) \n\nMorbidity rates\n\n \n5% increase\n \n \n(7,191\n) \n \n \n(4,639\n) \n \n \n-\n \n \n \n-\n \n \n \n(7,191\n) \n \n \n(4,639\n) \n\n* bp = basis point\n\nLiquidity risk\n\n \n\n(a)\n\nRisk management policy and exposure\n\nIn line with liquidity risk management policies, the accounting division of each insurance subsidiary prepares and updates cash flow plans in a timely manner based on the reports from departments and manages cash flows, and the risk management division of each insurance subsidiary manages the liquidity risk. The accounting division and risk management division periodically or as needed report such information to each insurance subsidiary’s Board of Directors and Executive Committee.\n\n \n\n(b)\n\nMaturity analysis\n\nThe following table summarizes the estimated timing of the remaining undiscounted net cash outflows from insurance contract liabilities and investment contract liabilities and the contractual timing of the remaining undiscounted cash inflows arising from securities held in the insurance business as of March 31, 2025. The cash flows of insurance contract liabilities are based on assumptions regarding morbidity rates, mortality rates, and lapse rates, which are consistent with the estimates used for the carrying amounts.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 2025\n\n \n\n \n \n\nTotal\n\n \n \n\nIndefinite\nTerms\n\n \n \n\nWithin\n\n1 year\n\n \n \n\n1 year to\n2 years\n\n \n \n\n2 years to\n3 years\n\n \n \n\n3 years to\n4 years\n\n \n \n\n4 years to\n5 years\n\n \n \n\nMore than\n\n5 years\n\n \n\nInsurance contract liabilities and investment contract liabilities\n\n \n \n22,740,658\n \n \n \n-\n \n \n \n64,000\n \n \n \n95,151\n \n \n \n157,008\n \n \n \n246,745\n \n \n \n288,630\n \n \n \n21,889,124\n \n\nSecurities held in the insurance business\n\n \n \n20,876,179\n \n \n \n4,372,358\n \n \n \n699,185\n \n \n \n358,761\n \n \n \n398,222\n \n \n \n314,310\n \n \n \n283,300\n \n \n \n14,450,043\n \n\nSince the total of the above estimated amounts is the amount before discounting, it exceeds the amount of insurance contract liabilities and securities which is included in investments and advances in the Financial Services business shown in the consolidated statements of financial position.\n\n \n\nF-\n6\n\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(c)\n\nAmounts payable on demand\n\nThe table below shows the amounts payable on demand from insurance contracts issued by Sony and the carrying amount of the related insurance contract portfolios. The amounts payable on demand represent the amount of the cash surrender value to be paid if the insurance contracts are surrendered as of March 31, 2025.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n 2025 \n\n \n\nAmounts payable on demand\n\n  \n \n13,214,887\n \n\nCarrying amount\n\n  \n \n12,642,981\n \n\n \n\n14.\n\nShort-term borrowings and long-term debt\n\nShort-term borrowings and long-term debt are comprised of the following:\n\n \n\n \n  \n\nMarch 31, 2025\n\n \n\n \n  \n\nBook value\n\n(Yen in millions)\n\n \n  \n\nWeighted average\n\ninterest rate\n\n \n \n\nDue\n\n \n\nShort-term borrowings\n\n  \n \n1,843,959\n \n  \n \n     2.13\n% \n \n\nLong-term debt\n\n  \n\n  \n\n \n\nLong-term loans\n\n  \n \n1,090,427\n \n  \n \n1.81\n% \n \n \n\n2025-2058\n\n \n\nUnsecured bonds\n\n  \n \n664,390\n \n  \n \n0.66\n% \n \n \n\n2025-2035\n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n  \n \n1,754,817\n \n  \n\n \n\nLess - Portion due within one year\n\n  \n \n196,950\n \n  \n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n  \n \n1,557,867\n \n  \n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n  \n\nMarch 31, 2026\n\n \n\n \n  \n\nBook value\n\n(Yen in millions)\n\n \n  \n\nWeighted average\n\ninterest rate\n\n \n \n\nDue\n\n \n\nShort-term borrowings\n\n  \n \n51,183\n \n  \n \n1.86\n% \n \n\nLong-term debt\n\n  \n\n  \n\n \n\nLong-term loans\n\n  \n \n516,460\n \n  \n \n3.21\n% \n \n \n2026-2040\n \n\nUnsecured bonds\n\n  \n \n474,343\n \n  \n \n0.70\n% \n \n \n\n2026-2035\n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n  \n \n990,803\n \n  \n\n \n\nLess - Portion due within one year\n\n  \n \n166,410\n \n  \n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n  \n \n824,393\n \n  \n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\nAs described in Note 2 (5), “Lease liabilities” which had previously been included within “Current portion of long-term debt” and “Long-term debt,” are presented as a separate caption in the consolidated statements of financial position as of March 31, 2026. In connection with this change, “Lease liabilities” are excluded from the table above.\n\nIn the Financial Services business, Sony pledged assets as collateral for short-term borrowings and long-term debt and the pledged assets are comprised of the following:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n\nSecurities\n\n  \n \n  1,595,016\n \n\nHousing loans in the banking business\n\n  \n \n961,286\n \n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of assets pledged as collateral as of March 31, 2026.\n\n \n\nF-\n\n70\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nIn addition to the above, in the Financial Services business, Sony pledged securities for\n\nsecurities-for-securities\n\nlending transactions and the pledged securities are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n\nSecurities\n\n  \n \n   332,867\n \n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of securities pledged for\n\nsecurities-for-securities\n\nlending transactions as of March 31, 2026.\n\nFurthermore, in the Financial Services business, Sony pledged securities as collateral for cash settlements, variation margins of futures markets and certain other purposes and the pledged securities are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n\nSecurities\n\n  \n \n  140,212\n \n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of securities pledged as collateral as of March 31, 2026.\n\nThere are no significant adverse debt covenants or cross-default provisions related to the other short-term borrowings and long-term debt.\n\n \n\n15.\n\nDerivative instruments and hedging activities\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, each description of derivative instruments and hedging activities related to the Financial Services business are presented only as of March 31, 2025.\n\nSony has certain financial instruments including financial assets and liabilities acquired in the normal course of business. Such financial instruments are exposed to market risk arising from the changes in foreign currency exchange rates, interest rates and stock prices. In applying a consistent risk management strategy for the purpose of reducing such risk, Sony uses derivative financial instruments, which include foreign exchange forward contracts, swap agreements, option contracts, and interest rate swap agreements (including interest rate and currency swap agreements). Certain other derivative financial instruments are entered into in the Financial Services business for ALM purposes. These instruments are executed with creditworthy financial institutions, and virtually all foreign currency contracts are denominated in U.S. dollars, euros and other currencies of major countries. Other than derivatives utilized in the Financial Services business for ALM, Sony does not use derivative financial instruments for trading or speculative purposes. These derivative transactions utilized for ALM in the Financial Services business are executed within certain limits in accordance with an internal risk management policy.\n\nA description of the purpose and classification of the derivative financial instruments held by Sony is as follows:\n\nForeign exchange forward contracts, swap agreements and currency option contracts\n\nForeign exchange forward contracts, swap agreements and purchased and written foreign currency option contracts are utilized primarily to limit the exposure affected by changes in foreign currency exchange rates on cash flows generated or anticipated by Sony’s transactions and accounts receivable and payable denominated in foreign currencies. The majority of written foreign currency option contracts expire in the same month as the corresponding purchased foreign currency option contracts.\n\nSony also entered into foreign exchange forward contracts and foreign currency option contracts which effectively fixed the cash flows from certain forecasted purchase and sale transactions denominated in foreign currencies for the fiscal years ended March 31, 2024, 2025 and 2026. The ineffective portions of the hedging relationships were not significant. Accordingly, these derivatives have been designated as cash flow hedges.\n\nForeign exchange forward contracts and foreign currency option contracts that do not qualify as hedges are measured at fair value with changes in value recognized in financial income and financial expenses.\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the changes in fair value of foreign exchange forward contracts, foreign currency option contracts and swap agreements held by certain subsidiaries in the Financial Services business previously recorded under financial services revenue have been reclassified and are included in net income (loss) from discontinued operations.\n\n \n\nF-7\n\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nInterest rate swap agreements (including interest rate and currency swap agreements)\n\nInterest rate swap agreements are utilized primarily to lower funding costs, to diversify sources of funding and to limit Sony’s exposure associated with underlying borrowings and debt securities resulting from adverse fluctuations in interest rates, foreign currency exchange rates and changes in fair values. Interest rate swap agreements entered into in the Financial Services business are used for reducing the risk arising from the changes in the fair value of fixed rate bonds. In addition, these interest rate swap agreements are used as hedging instruments such as cash flow hedges and fair value hedges. The ineffectiveness of the hedging relationship was not significant for the fiscal years ended March 31, 2024, 2025 and 2026.\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the changes in fair value of interest rate swap agreements held by certain subsidiaries in the Financial Services business as part of their ALM previously recorded under financial services revenue have been reclassified and are included in net income (loss) from discontinued operations.\n\nAny other interest rate swap agreements that do not qualify as hedges, which are used for reducing the risk arising from changes of variable rate debt, are measured at fair value with changes in value recognized in net profit or loss as financial income/expenses.\n\nOption contracts (equity contracts)\n\nOption contracts related to equity contracts are used to hedge the market price fluctuation risk of the shares held, and changes in fair value are immediately recognized in net profit or loss as finance income/expenses.\n\nOther agreements\n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the changes in fair value of equity future contracts, equity swap agreements, bond future contracts, interest rate swaption agreements and other currency contracts held by certain subsidiaries in the Financial Services business as part of their ALM previously recorded under financial services revenue have been reclassified and are included in net income (loss) from discontinued operations. Certain bond futures contracts are used as hedging instruments in fair value hedges to reduce the risk of fluctuations in the fair value of fixed rate bonds due to changes in market interest rates. The ineffectiveness of the hedging relationship was not significant for the fiscal years ended March 31, 2025 and 2026. In addition, the hybrid financial instruments, disclosed in Note 5 as debt securities, contained embedded derivatives that are not required to be bifurcated because the entire instruments are measured at fair value.\n\nThe estimated fair values of Sony’s outstanding derivative instruments are summarized as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31, 2025\n\n \n  \n\nMarch 31, 2026\n\n \n\n \n  \n\nAsset\n\nderivatives\n\n \n  \n\nLiability\n\nderivatives\n\n \n  \n\nAsset\n\nderivatives\n\n \n  \n\nLiability\n\nderivatives\n\n \n\nInterest rate contracts\n\n  \n\n  \n\n  \n\n  \n\nInterest rate swap agreements\n\n  \n \n65,075\n \n  \n \n12,674\n \n  \n \n20,982\n \n  \n \n-\n \n\nInterest rate swaptions agreements\n\n  \n \n358\n \n  \n \n3,161\n \n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nForeign exchange contracts\n\n  \n\n  \n\n  \n\n  \n\nForeign exchange forward contracts\n\n  \n \n4,173\n \n  \n \n10,542\n \n  \n \n4,619\n \n  \n \n10,238\n \n\nSwap agreements\n\n  \n \n5,743\n \n  \n \n3,117\n \n  \n \n2,199\n \n  \n \n3,976\n \n\nCurrency option contracts purchased\n\n  \n \n782\n \n  \n \n671\n \n  \n \n76\n \n  \n \n-\n \n\nCurrency option contracts written\n\n  \n \n-\n \n  \n \n3\n \n  \n \n-\n \n  \n \n339\n \n\nOther currency contracts\n\n  \n \n4,557\n \n  \n \n1,445\n \n  \n \n78\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nEquity contracts\n\n  \n\n  \n\n  \n\n  \n\nEquity future contracts\n\n  \n \n910\n \n  \n \n514\n \n  \n \n-\n \n  \n \n-\n \n\nEquity swap agreements\n\n  \n \n911\n \n  \n \n-\n \n  \n \n-\n \n  \n \n-\n \n\nOption contracts\n\n  \n \n2,346\n \n  \n \n118,606\n \n  \n \n-\n \n  \n \n55,663\n \n\nBond contracts\n\n  \n\n  \n\n  \n\n  \n\nBond forward contracts written\n\n  \n \n1,286\n \n  \n \n3,793\n \n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal derivatives\n\n  \n \n86,141\n \n  \n \n154,526\n \n  \n \n27,954\n \n  \n \n70,216\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nF-7\n\n2\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe estimated fair values and maturity analysis for notional amounts of Sony’s outstanding derivative instruments which are designated as hedging instruments are summarized as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 2025\n\n \n\n \n \n\nNotional amounts\n\n \n \n\nFair Value\n\n \n\n \n \n\nWithin 1\nYear\n\n \n \n\nOver 1\nYear\n\n \n \n\nTotal\n\n \n \n\nAsset\nderivatives\n\n \n \n\nLiability\nderivatives\n\n \n \n\nPresentation in the\nconsolidated statements of\nfinancial position\n\n \n\nCash flow hedging relationships\n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign exchange forward contracts\n\n \n \n14,292\n \n \n \n-\n \n \n \n14,292\n \n \n \n178\n \n \n \n-\n \n \n \nCurrent assets: Other\nfinancial assets\n \n \n\nAverage rate (JPY/USD)\n\n \n \n150.4\n \n \n \n-\n \n \n\n \n\n \n\n \n\nCurrency option bought contracts\n\n \n \n43,144\n \n \n \n-\n \n \n \n43,144\n \n \n \n777\n \n \n \n-\n \n \n \nCurrent assets: Other\nfinancial assets\n \n \n\nAverage rate (JPY/USD)\n\n \n \n145.8\n \n \n \n-\n \n \n\n \n\n \n\n \n\nCurrency option sold contracts\n\n \n \n44,365\n \n \n \n-\n \n \n \n44,365\n \n \n \n-\n \n \n \n671\n \n \n \nCurrent liabilities: Other\nfinancial liabilities\n \n \n\nAverage rate (JPY/USD)\n\n \n \n149.9\n \n \n \n-\n \n \n\n \n\n \n\n \n\nInterest rate swap agreements\n\n \n \n-\n \n \n \n179,232\n \n \n \n179,232\n \n \n \n25,139\n \n \n \n-\n \n \n \n\nNon-current\nassets:\nOther financial assets\n \n \n\nAverage rate\n\n \n \n-\n \n \n \n1.5\n% \n \n\n \n\n \n\n \n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\n \n\nNotional amounts\n\n \n\n \n\nFair Value\n\n \n\n \n\n \n\nWithin 1\nYear\n\n \n\n \n\nOver 1\nYear\n\n \n\n \n\nTotal\n\n \n\n \n\nAsset\nderivatives\n\n \n\n \n\nLiability\nderivatives\n\n \n\n \n\nPresentation in the\nconsolidated statements of\nfinancial position\n\n \n\nCash flow hedging relationships\n\n \n\n \n\n \n\n \n\n \n\n \n\nForeign exchange forward contracts\n\n \n \n2,723\n \n \n \n-\n \n \n \n2,723\n \n \n \n-\n \n \n \n\n134\n\n \n \n \nCurrent liabilities: Other\nfinancial liabilities\n \n \n\nAverage rate (JPY/USD)\n\n \n \n151.3\n \n \n \n-\n \n \n\n \n\n \n\n \n\nCurrency option bought contracts\n\n \n \n17,918\n \n \n \n-\n \n \n \n17,918\n \n \n \n76\n \n \n \n-\n \n \n \nCurrent assets: Other\nfinancial assets\n \n \n\nAverage rate (JPY/USD)\n\n \n \n153.1\n \n \n \n-\n \n \n\n \n\n \n\n \n\nCurrency option sold contracts\n\n \n \n18,331\n \n \n \n-\n \n \n \n18,331\n \n \n \n-\n \n \n \n339\n \n \n \nCurrent liabilities: Other\nfinancial liabilities\n \n \n\nAverage rate (JPY/USD)\n\n \n \n156.7\n \n \n \n-\n \n \n\n \n\n \n\n \n\nInterest rate swap agreements\n\n \n \n-\n \n \n \n191,820\n \n \n \n191,820\n \n \n \n20,982\n \n \n \n-\n \n \n \n\nNon-current\nassets:\nOther financial assets\n \n \n\nAverage rate\n\n \n \n-\n \n \n \n1.5\n% \n \n\n \n\n \n\n \n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31, 2025\n\n \n\n \n  \n\nNotional amounts\n\n \n  \n\nFair Value\n\n \n\n \n  \n\nWithin 1\nYear\n\n \n  \n\nOver 1\nYear\n\n \n \n\nTotal\n\n \n  \n\nAsset\nderivatives\n\n \n  \n\nLiability\nderivatives\n\n \n  \n\nPresentation in the\nconsolidated statements of\nfinancial position\n\n \n\nFair value hedging relationships\n\n  \n\n  \n\n \n\n  \n\n  \n\n  \n\nBond futures contracts written\n\n  \n \n124,401\n \n  \n \n-\n \n \n \n124,401\n \n  \n \n-\n \n  \n \n2,509\n \n  \n \nCurrent liabilities:\nOther financial liabilities\n \n \n\nAverage unit price\n\n  \n \n119.8\n \n  \n \n-\n \n \n\n  \n\n  \n\n  \n\nInterest rate swap agreements\n\n  \n \n-\n \n  \n \n411,204\n \n \n \n411,204\n \n  \n \n15,029\n \n  \n \n1,567\n \n  \n \n\n \n\nNon-current\nassets: Other\n\nfinancial assets / Non-current\n\nliabilities: Other financial\nliabilities\n \n \n \n \n\nAverage rate\n\n  \n \n-\n \n  \n \n3.0\n% \n \n\n  \n\n  \n\n  \n\n \n\nF-7\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nAs a result of the\nexecution\nof the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of derivative instruments which are designated as hedging instruments of fair value hedges as of March 31, 2026.\n\nChanges in the fair value of hedging instruments related to cash flow hedges recorded in accumulated other comprehensive income for the fiscal years ended March 31, 2025 and 2026 are summarized as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n  \n\nForeign exchange\ncontracts\n\n \n\n \n\nInterest rate\ncontracts\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n  \n \n(1,720\n) \n \n \n21,485\n \n \n \n19,765\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in fair value of hedging instruments recognized in other comprehensive income\n\n  \n \n(6,238\n) \n \n \n854\n \n \n \n(5,384\n) \n\nReclassification adjustments to profit (loss) for the year\n*1*2\n\n  \n \n8,824\n \n \n \n(8,391\n) \n \n \n433\n \n\nDeferred tax\n\n  \n \n(791\n) \n \n \n1,447\n \n \n \n656\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n \n75\n \n \n \n15,395\n \n \n \n15,470\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nChanges in fair value of hedging instruments recognized in other comprehensive income\n\n  \n \n(10,377\n)\n \n \n2,961\n \n \n \n(7,416\n)\n\nReclassification adjustments to profit (loss) for the year\n*1*2\n\n  \n \n9,695\n \n \n \n(6,866\n)\n \n \n2,829\n \n\nDeferred tax\n\n  \n \n331\n \n \n \n872\n \n \n \n1,203\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n \n(276\n)\n \n \n12,362\n \n \n \n12,086\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nIn the consolidated statements of income, the amount reclassified to profit (loss) is included in sales for hedges of foreign exchange contracts and in financial expenses for hedges of interest rate contracts.\n\n*2\n\nFor the fiscal years ended March 31, 2025 and 2026, hedge ineffectiveness recognized in profit or loss was not material.\n\nThe carrying amount of hedged items classified as fair value hedges and the accumulative fair value hedge adjustments during the fiscal year ended March 31, 2025 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n  \n\nMarch 31, 2025\n\n \n  \n\nCarrying amount of hedged\nitems\n\n \n  \n\nAccumulative fair value hedge\nadjustments\n\n \n  \n\nPresentation in the\nconsolidated statements of\nfinancial position\n\n \n  \n\nAsset\n\n \n  \n\nLiability\n\n \n  \n\nAsset\n\n \n \n\nLiability\n\n \n\nFixed rate bonds\n\n  \n \n485,960\n \n  \n \n-\n \n  \n \n(3,330\n) \n \n \n-\n \n  \nInvestments and advances\nin the Financial Services\nsegment\n(Non-current)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of the carrying amount of hedged items classified as fair value hedges or of the accumulative fair value hedge adjustments as of March 31, 2026.\n\n \n\nF-7\n\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n16.\n\nOffsetting of financial assets and financial liabilities\n\nTables below show the gross amounts of financial assets and liabilities, amounts offset, and net amounts presented in the consolidated statements of financial position, as well as the financial assets and liabilities that are subject to enforceable master netting agreements or similar agreements, as of March 31, 2025 and 2026.\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nMarch 31, 202\n5\n\n \n\n \n \n\nGross amounts\n\nrecognized\n\nfinancial assets\n\nand financial\n\nliabilities\n\n \n \n\nAmounts offset\n\nin the\n\nconsolidated\n\nstatements of\n\nfinancial position\n\n \n \n\nNet amounts\n\npresented in the\n\nconsolidated\n\nstatements of\n\nfinancial position\n\n \n \n\nGross amounts not offset in the\n\nconsolidated statements of\n\nfinancial position\n\n \n \n \n \n\n \n \n\nFinancial\n\ninstruments\n\n \n \n\nCash\n\ncollateral\n\n \n \n\nNet amounts\n\n \n\nDerivative assets\n*1\n\n \n \n52,388\n \n \n \n-\n \n \n \n52,388\n \n \n \n22,228\n \n \n \n12,402\n \n \n \n17,758\n \n\nTrade receivables\n*2\n\n \n \n62,525\n \n \n \n61,367\n \n \n \n1,158\n \n \n \n-\n \n \n \n-\n \n \n \n1,158\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal assets\n\n \n \n114,913\n \n \n \n61,367\n \n \n \n53,546\n \n \n \n22,228\n \n \n \n12,402\n \n \n \n18,916\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDerivative liabilities\n*1\n\n \n \n35,554\n \n \n \n-\n \n \n \n35,554\n \n \n \n22,228\n \n \n \n3,547\n \n \n \n9,779\n \n\nTrade payables\n*2\n\n \n \n122,408\n \n \n \n61,367\n \n \n \n61,041\n \n \n \n-\n \n \n \n-\n \n \n \n61,041\n \n\nShort-term borrowings\n*3\n\n \n \n1,521,040\n \n \n \n-\n \n \n \n1,521,040\n \n \n \n1,514,271\n \n \n \n-\n \n \n \n6,769\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal liabilities\n\n \n \n1,679,002\n \n \n \n61,367\n \n \n \n1,617,635\n \n \n \n1,536,499\n \n \n \n3,547\n \n \n \n77,589\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\nYen in millions\n\n \n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n \n\nGross amounts\n\nrecognized\n\nfinancial assets\n\nand financial\n\nliabilities\n\n \n \n\nAmounts offset\n\nin the\n\nconsolidated\n\nstatements of\n\nfinancial position\n\n \n \n\nNet amounts\n\npresented in the\n\nconsolidated\n\nstatements of\n\nfinancial position\n\n \n \n\nGross amounts not offset in the\n\nconsolidated statements of\n\nfinancial position\n\n \n \n \n \n\n \n\n \n\nFinancial\n\ninstruments\n\n \n\n \n\nCash\n\ncollateral\n\n \n\n \n\nNet amounts\n\n \n\nDerivative assets*\n1\n\n \n\n \n\n6,817\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,817\n\n \n\n \n\n \n\n5,877\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n940\n\n \n\nTrade receivables*\n2\n\n \n\n \n\n70,833\n\n \n\n \n\n \n\n66,260\n\n \n\n \n\n \n\n4,573\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n4,573\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal assets\n\n \n\n \n\n77,650\n\n \n\n \n\n \n\n66,260\n\n \n\n \n\n \n\n11,390\n\n \n\n \n\n \n\n5,877\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n5,513\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDerivative liabilities*\n1\n\n \n\n \n\n12,903\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n12,903\n\n \n\n \n\n \n\n5,877\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n7,026\n\n \n\nTrade payables*\n2\n\n \n\n \n\n94,832\n\n \n\n \n\n \n\n66,260\n\n \n\n \n\n \n\n28,572\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n28,572\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal liabilities\n\n \n\n \n\n107,735\n\n \n\n \n\n \n\n66,260\n\n \n\n \n\n \n\n41,475\n\n \n\n \n\n \n\n5,877\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n35,598\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n*1\n\nCertain subsidiaries have entered into master netting agreements or other similar agreements, which are mainly International Swaps and Derivatives Association (“ISDA”) Master Agreements. An ISDA Master Agreement is an agreement between two counterparties that may have multiple derivative contracts with each other, and such ISDA Master Agreement may provide for the net settlement of all or a specified group of these derivative contracts, through a single payment, in a single currency, in the event of a default on or affecting any one derivative contract, or a termination event affecting all or a specified group of derivative contracts. Master netting agreements create a right of set off, but the master netting agreements do not automatically provide for such set off.\n\n*2\n\nAmounts offset in the consolidated statements of financial position are related to repurchase agreements of products.\n\n*3\n\nShort-term borrowings relate to bond lending transactions and repurchase agreements (repos). As a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance of short-term borrowings as of March 31, 2026.\n\n \n\n17.\n\nEmployee benefits\n\n \n\n(1)\n\nDefined benefit and severance plans\n\nUpon terminating employment, employees of Sony Group Corporation and its subsidiaries in Japan are entitled, under most circumstances, to\nlump-sum\nindemnities or pension payments as described below. Sony Group Corporation and certain of its subsidiaries’ pension plans utilize a point-based plan under which a point is added every year reflecting the individual employee’s performance over that year. Under the point-based plan, the amount of payment is determined based on the sum of cumulative points from past services and interest points earned on the cumulative points regardless of whether or not the employee is voluntarily retiring.\n\nUnder the plans, the defined benefits cover approximately\n\n \n\n70\n% of the indemnities under existing regulations to employees. The remaining indemnities are covered by severance payments by the companies. The pension benefits are payable at the option of the retiring employee either in a\n\nlump-sum\n\namount or monthly pension payments. Contributions to the plans are funded through several financial institutions in accordance with the applicable laws and regulations.\n\n \n\nF-7\n\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nFrom April 1, 2012, Sony Group Corporation and substantially all of its subsidiaries in Japan have modified existing defined benefit pension plans such that life annuities will no longer accrue additional service benefits, with those participants instead accruing fixed-term annuities. The defined benefit pension plans were closed to new participants and a defined contribution plan was also introduced.\n\nFrom October 1, 2019, Sony Group Corporation and substantially all of its subsidiaries in Japan have amended their defined benefit pension plans and have implemented defined contribution plans for all employees other than those employees that had retired before the amendments.\n\nIn addition, several of Sony’s foreign subsidiaries have defined benefit pension plans or severance indemnity plans, which cover substantially all of their employees. Under such plans, the related cost of benefits is currently funded or accrued. Benefits awarded under these plans are based primarily on the current rate of pay and length of service.\n\nNet defined benefit liability (asset) recognized in the consolidated statements of financial position\n\nAmounts recognized in the consolidated statements of financial position are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\nMarch 31\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nPresent value of defined benefit obligations\n\n  \n \n488,818\n \n \n \n387,432\n \n  \n \n130,259\n \n \n \n139,768\n \n\nFair value of plan assets\n\n  \n \n(439,943\n) \n \n \n(418,453\n)\n  \n \n(49,648\n)\n \n \n(81,261\n)\n\nThe impact of minimum funding requirement and asset ceiling\n\n  \n \n10,147\n \n \n \n-\n \n  \n \n3,225\n \n \n \n3,319\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet amount\n\n  \n \n59,022\n \n \n \n(31,021\n)\n  \n \n83,836\n \n \n \n61,826\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAmount recognized in the consolidated statements of financial position\n\n  \n\n \n\n  \n\n \n\nNet defined benefit asset\n\n  \n \n(84,009\n) \n \n \n(127,452\n)\n \n\n  \n \n(2,905\n)\n \n\n \n \n(2,314\n)\n \n\nNet defined benefit liability\n\n  \n \n143,031\n \n \n \n96,431\n \n  \n \n86,741\n \n \n \n64,140\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet amount\n\n  \n \n59,022\n \n \n \n(31,021\n)\n  \n \n83,836\n \n \n \n61,826\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nPresent value of defined benefit obligations\n\nThe changes in the defined benefit obligations for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n  \n\nForeign plans\n\n \n\n \n\n  \n\n Fiscal year ended March 31 \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nBeginning balance of the fiscal year\n\n  \n \n543,292\n \n  \n \n488,818\n \n  \n \n126,987\n \n  \n \n130,259\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent service cost\n\n  \n \n11,561\n \n  \n \n6,565\n \n  \n \n2,049\n \n  \n \n1,995\n \n\nPast service cost\n\n  \n \n-\n \n  \n \n-\n \n  \n \n216\n \n  \n \n980\n \n\nInterest cost\n\n  \n \n7,861\n \n  \n \n9,373\n \n  \n \n5,155\n \n  \n \n5,477\n \n\nRemeasurements:\n\n  \n\n  \n\n  \n\n  \n\nChange in demographic assumptions\n\n  \n \n2,005\n \n  \n \n1,509\n \n  \n \n14\n \n  \n \n489\n \n\nChange in financial assumptions\n\n  \n \n(32,255\n) \n  \n \n(33,628\n)\n \n\n  \n \n(3,707\n) \n  \n \n(5,272\n)\n \n\nOther\n\n  \n \n1,514\n \n  \n \n(294\n)\n  \n \n8,894\n \n  \n \n639\n \n\nTranslation adjustments\n\n  \n \n-\n \n  \n \n-\n \n  \n \n(1,382\n) \n  \n \n14,217\n\n \n\nPlan participants’ contributions\n\n  \n \n-\n \n  \n \n-\n \n  \n \n231\n \n  \n \n276\n \n\nBenefits paid\n\n  \n \n(45,135\n) \n  \n \n(32,318\n)\n  \n \n(8,198\n) \n  \n \n(8,741\n)\n\nCurtailments and settlements\n\n  \n \n-\n \n  \n \n-\n \n  \n \n-\n \n  \n \n(551\n\n)\n\nOther\n\n  \n \n(25\n) \n  \n \n-\n\n  \n \n-\n \n  \n \n-\n \n\nImpact from loss of control of the Financial Services business*\n\n  \n \n-\n \n  \n \n(52,593\n)\n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nEnding balance of the fiscal year\n\n  \n \n488,818\n \n  \n \n387,432\n \n  \n \n130,259\n \n  \n \n139,768\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n*\n\nThe figures for the fiscal year ended March 31, 2026 include the impact of the deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\nF-7\n\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe weighted average duration of defined benefit obligations as of March 31, 2025 and 2026 is as follows:\n\n \n\n$\n\n                     \n\n$\n\n                     \n\n$\n\n                     \n\n$\n\n                     \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\nMarch 31\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nWeighted average duration of defined benefit obligations\n\n  \n\n \n\n10.6 years\n\n  \n\n \n\n \n\n10.7 years\n\n  \n\n \n\n \n\n11.9 years\n\n  \n\n \n\n \n\n11.3 years\n\n  \n\nThe significant actuarial assumptions used to determine the present value of defined benefit obligations as of March 31, 2025 and 2026 are as follows:\n\n \n\n$\n\n                \n\n$\n\n                \n\n$\n\n                \n\n$\n\n                \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\nMarch 31\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nDiscount rate\n\n  \n\n \n\n    2.1\n\n% \n\n \n\n \n\n    3.1\n\n% \n\n \n\n \n\n    4.1\n\n% \n\n \n\n \n\n    4.5\n\n% \n\nThe sensitivities of the defined benefit obligations to changes in the significant weighted-average actuarial assumptions are as follows:\n\n \n\n$\n\n                  \n\n$\n\n                  \n\n$\n\n                  \n\n$\n\n                  \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\nMarch 31\n\n \n\nChange in assumptions\n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nDiscount rate\n\n  \n\n \n\n \n\n \n\n0.25% decrease\n\n  \n\n \n\n 11,336\n\n \n\n \n\n \n\n 8,434\n\n \n\n \n\n \n\n 3,628\n\n \n\n \n\n \n\n 6,616\n\n \n\n0.25% increase\n\n  \n\n \n\n(10,878\n\n) \n\n \n\n \n\n(8,113\n\n) \n\n \n\n \n\n(3,437\n\n) \n\n \n\n \n\n(6,274\n\n) \n\nThe sensitivity analyses are calculated using the same method used to determine the defined benefit liability recognized in the consolidated statements of financial position while holding all other assumptions consistent.\n\nFair value of plan assets\n\nSony’s pension investment policy recognizes the expected growth and the variability risk associated with the long-term nature of pension liabilities, the returns and risks of diversification across asset classes, and the correlation among assets. The asset allocations are designed to maximize returns consistent with levels of liquidity and investment risk that are considered prudent and reasonable. While the pension investment policy gives appropriate consideration to recent market performance and historical returns, the investment assumptions utilized by Sony are designed to achieve a long-term return consistent with the long-term nature of the corresponding pension liabilities.\n\nThe investment objectives of Sony’s plan assets are designed to generate returns that will enable the plans to meet their future obligations. The precise amount for which these obligations will be settled depends on future events, including the retirement dates and life expectancy of the plans’ participants. The obligations are estimated using actuarial assumptions, based on current economic conditions and other pertinent factors. Sony’s investment strategy balances the requirement to generate returns, using potentially higher yielding assets such as equity securities, with the need to control risk in the portfolio with less volatile assets, such as fixed-income securities. Risks include, among others, inflation, volatility in equity values and changes in interest rates that could negatively impact the funding level of the plans, thereby increasing their dependence on contributions from Sony. To mitigate any potential concentration risk of plan assets, thorough consideration is given to balancing the portfolio among industry sectors and geographies, taking into account interest rate sensitivity, dependence on economic growth, currency and other factors that affect investment returns. The target allocations as of March 31, 2026, are, as a result of Sony’s asset liability management, 14% (as of March 31, 2025: 14%) of equity securities, 57% (as of March 31, 2025: 57%) of fixed income securities and 29% (as of March 31, 2025: 29%) of other investments for the pension plans of Sony Group Corporation and most of its subsidiaries in Japan, and, on a weighted average basis, 1% (as of March 31, 2025: 2%) of equity securities, 6% (as of March 31, 2025: 10%) of fixed income securities and 93% (as of March 31, 2025: 88%) of other investments for the pension plans of foreign subsidiaries.\n\n \n\nF-\n7\n\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe changes in the plan assets for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\n \n\nFiscal year ended March 31\n\n \n\n \n\nFiscal year ended March 31\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nBeginning balance of the fiscal year\n\n \n \n464,376\n \n \n \n 439,943\n \n \n \n47,893\n \n \n \n49,648\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nInterest income\n\n \n \n7,047\n \n \n \n9,139\n \n \n \n2,202\n \n \n \n2,418\n \n\nRemeasurements:\n\n \n\n \n\n \n\n \n\nReturn on plan assets excluding interest income\n\n \n \n(9,997\n) \n \n \n15,806\n\n \n\n \n \n1,330\n \n \n \n(1,515\n)\n\nTranslation adjustments\n\n \n \n-\n \n \n \n-\n \n \n \n(462\n) \n \n \n6,233\n\n \n\nEmployer contribution\n\n \n \n2,362\n \n \n \n858\n \n \n \n5,645\n \n \n \n3,900\n \n\nPlan participants’ contributions\n\n \n \n-\n \n \n \n-\n \n \n \n359\n \n \n \n291\n \n\nBenefits paid\n\n \n \n(23,845\n) \n \n \n(22,571\n)\n \n \n(7,319\n)\n \n \n \n \n(7,949\n)\n\nCurtailments and settlements\n\n \n\n \n\n-\n\n \n\n \n \n-\n \n \n\n \n\n-\n\n \n\n \n \n(349\n\n)\n \n\nImpact from loss of control of the Financial Services business*\n1\n\n \n \n-\n \n \n \n(24,722\n\n)\n \n\n \n \n-\n \n \n \n-\n \n\nOther*\n2\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n28,584\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nEnding balance of the fiscal year\n\n \n \n   439,943\n \n \n \n   418,453\n \n \n \n   49,648\n \n \n \n   81,261\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nThe figures for the fiscal year ended March 31, 2026 include the impact of the deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\n*2\n\nThe increase for the fiscal year ended March 31, 2026 is primarily attributable to contributions to plan assets associated with the establishment of new trust agreements at certain overseas subsidiaries.\n\nSony makes contributions to its defined benefit pension plans as deemed appropriate by management after considering the fair value of plan assets, expected return on plan assets and the present value of defined benefit obligations. Sony expects to contribute approximately 1 billion yen to the Japanese plans and approximately 6 billion yen to the foreign plans during the fiscal year ending March 31, 202\n7\n.\n\nThe fair values of the assets held by Japanese and foreign plans are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nJapanese plans\n\n \n\n \n  \n\nMarch 31\n\n2025\n\n \n  \n\nMarket price in active\nmarket\n\n \n\nAsset class\n\n  \n\n Quoted \n\n \n  \n\n Unquoted \n\n \n\nCash and cash equivalents\n\n  \n \n12,192\n \n  \n \n12,192\n \n  \n \n-\n \n\nEquity securities\n*1\n\n  \n \n54,103\n \n  \n \n48,624\n \n  \n \n5,479\n \n\nFixed income:\n\n  \n\n  \n\n  \n\nGovernment bonds\n*2\n\n  \n \n11,565\n \n  \n \n382\n \n  \n \n11,183\n \n\nCorporate bonds\n*3\n\n  \n \n5,241\n \n  \n \n18\n \n  \n \n5,223\n \n\nCommingled funds\n*4\n\n  \n \n278,892\n \n  \n \n-\n \n  \n \n278,892\n \n\nPrivate equity\n\n  \n \n35,115\n \n  \n \n-\n \n  \n \n35,115\n \n\nHedge funds\n\n  \n \n42,835\n \n  \n \n-\n \n  \n \n42,835\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n439,943\n \n  \n \n61,216\n \n  \n \n378,727\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nF-\n7\n\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\n  \n\nMarch 31\n\n2026\n\n \n\n  \n\nMarket price in active\nmarket\n\n \n\nAsset class\n\n  \n\n Quoted \n\n \n\n  \n\n Unquoted \n\n \n\nCash and cash equivalents\n\n  \n \n4,755\n \n  \n \n4,755\n \n  \n \n-\n \n\nEquity securities\n*1\n\n  \n \n51,815\n \n  \n \n43,662\n \n  \n \n8,153\n \n\nFixed income:\n\n  \n\n  \n\n  \n\nGovernment bonds\n\n  \n \n3,773\n \n  \n \n3,773\n \n  \n \n-\n \n\nCommingled funds\n*4\n\n  \n \n274,752\n \n  \n \n-\n \n  \n \n274,752\n \n\nPrivate equity\n\n  \n \n36,814\n \n  \n \n-\n \n  \n \n36,814\n \n\nHedge funds\n\n  \n \n46,544\n \n  \n \n-\n \n  \n \n46,544\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n418,453\n \n  \n \n52,190\n \n  \n \n366,263\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n*1\n\nRepresents primarily Japanese equity securities.\n\n*2\n\nIncludes approximately 84% of debt securities issued by Japanese national and local governments, and 16% \nof debt securities issued by foreign national and local governments. \n\n*3\n\nIncludes debt securities issued by Japanese and foreign corporations and government related agencies.\n\n*4\n\nCommingled funds represent pooled institutional investments, including primarily investment trusts.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nForeign plans\n\n \n\n \n  \n\nMarch 31\n\n2025\n\n \n  \n\nMarket price in active\nmarket\n\n \n\nAsset class\n\n  \n\n Quoted \n\n \n  \n\n Unquoted \n\n \n\nCash and cash equivalents\n\n  \n \n4,599\n \n  \n \n4,599\n \n  \n \n-\n \n\nEquity securities\n*1\n\n  \n \n101\n \n  \n \n101\n \n  \n \n-\n \n\nFixed income:\n\n  \n\n  \n\n  \n\nGovernment bonds\n*2\n\n  \n \n1,207\n \n  \n \n-\n \n  \n \n1,207\n \n\nCorporate bonds\n*3\n\n  \n \n175\n \n  \n \n-\n \n  \n \n175\n \n\nAsset-backed securities\n\n  \n \n43\n \n  \n \n-\n \n  \n \n43\n \n\nInsurance contracts\n*4\n\n  \n \n23,057\n \n  \n \n334\n \n  \n \n22,723\n \n\nCommingled funds\n*5\n\n  \n \n16,929\n \n  \n \n-\n \n  \n \n16,929\n \n\nReal estate and other\n\n  \n \n3,537\n \n  \n \n-\n \n  \n \n3,537\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n49,648\n \n  \n \n5,034\n \n  \n \n44,614\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nForeign plans\n\n \n\n \n\n  \n\nMarch 31\n\n2026\n\n \n\n  \n\nMarket price in active\nmarket\n\n \n\nAsset class\n\n  \n\n Quoted \n\n \n\n  \n\n Unquoted \n\n \n\nCash and cash equivalents\n\n  \n \n4,695\n \n  \n \n4,695\n \n  \n \n-\n \n\nEquity securities\n*1\n\n  \n \n119\n \n  \n \n59\n \n  \n \n60\n \n\nFixed income:\n\n  \n\n  \n\n  \n\nGovernment bonds\n*2\n\n  \n \n1,070\n \n  \n \n-\n \n  \n \n1,070\n \n\nCorporate bonds\n*3\n\n  \n \n194\n \n  \n \n-\n \n  \n \n194\n \n\nAsset-backed securities\n\n  \n \n196\n \n  \n \n-\n \n  \n \n196\n \n\nInsurance contracts\n*4\n\n  \n \n24,125\n \n  \n \n-\n \n  \n \n24,125\n \n\nCommingled funds\n*5\n\n  \n \n45,909\n \n  \n \n-\n \n  \n \n45,909\n \n\nReal estate and other\n\n  \n \n4,953\n \n  \n \n13\n \n  \n \n4,940\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n81,261\n \n  \n \n4,767\n \n  \n \n76,494\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n*1\n\nRepresents primarily foreign equity securities.\n\n*2\n\nIncludes primarily foreign government debt securities.\n\n*3\n\nIncludes primarily foreign corporate debt securities.\n\n*4\n\nRepresents annuity contracts with or without profit sharing and bulk insurance contracts.\n\n*5\n\nCommingled funds represent pooled institutional investments, including primarily investment trusts.\n\n \n\nF-\n\n7\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe impact of minimum funding requirement and asset ceiling\n\nThe impact of minimum funding requirement and asset ceiling for the fiscal years ended March 31, 2025 and 2026 is as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n  \n\nForeign plans\n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n   2025   \n\n \n\n  \n\n   2026   \n\n \n\n  \n\n   2025   \n\n \n\n \n\n   2026   \n\n \n\nBeginning balance of the fiscal year\n\n  \n \n9,837\n \n  \n \n10,147\n \n  \n \n3,457\n \n \n \n3,225\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nInterest income\n\n  \n \n139\n \n  \n \n-\n \n  \n \n174\n \n \n \n178\n \n\nRemeasurements:\n\n  \n\n  \n\n  \n\n \n\nChange in asset ceiling excluding interest income\n\n  \n \n171\n \n  \n \n-\n \n  \n \n(436\n) \n \n \n(387\n)\n \n\nTranslation adjustments\n\n  \n \n-\n \n  \n \n-\n \n  \n \n30\n \n \n \n303\n \n\nImpact from loss of control of the Financial Service\ns\nbusiness*\n\n  \n \n-\n \n  \n \n(10,147\n)\n \n\n  \n \n-\n \n \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nEnding balance of the fiscal year\n\n  \n \n10,147\n \n  \n \n-\n \n  \n \n3,225\n \n \n \n3,319\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*\n\nThe figures for the fiscal year ended March 31, 2026 include the impact of the deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\n(2)\n\nDefined contribution plans\n\nTotal defined contribution expenses for the fiscal years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nJapanese plans\n\n  \n \n11,662\n \n  \n \n11,849\n \n  \n \n11,125\n \n\nForeign plans\n\n  \n \n   16,137\n \n  \n \n   17,209\n \n  \n \n19,112\n \n\nThe above amounts for Japanese plans include expenses related to the Financial Services business. In connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, expenses related to the Financial Services business are included in net income (loss) from discontinued operations in the consolidated statements of income.\n\n \n\n(3)\n\nEmployee benefits expenses\n\nEmployee benefits expenses included in cost of sales, selling, general and administrative, and net income (loss) from discontinued operations in the consolidated statements of income for the fiscal years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nTotal employee benefits expenses\n\n  \n \n1,743,936\n \n  \n \n1,840,803\n \n  \n \n1,784,569\n \n\nIn connection with the Resolution for the plan regarding the execution of the Partial Spin-off of the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, expenses related to the Financial Services business in the above amounts are included in net income (loss) from discontinued operations in the consolidated statements of income.\n\nEmployee benefits expenses include salaries, bonuses, stock-based compensation, social security, welfare and expenses relating to post-employment benefits.\n\n \n\nF-80\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n18.\n\nParticipation and residual liabilities in the Pictures segment\n\nThe changes in participation and residual liabilities for the fiscal year ended March 31, 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\n Fiscal year ended March 31\n\n \n\n \n  \n\n2026\n\n \n\nBalance at beginning of the fiscal year\n\n  \n \n425,671\n \n\n  \n\n \n\n \n\n \n\nCurrent portion\n\n  \n \n236,752\n \n\nNon-current\nportion\n\n  \n \n188,919\n \n\n  \n\n \n\n \n\n \n\nAdditional participation and residual liabilities\n\n  \n \n159,039\n \n\nImpact due to passage of time\n\n  \n \n5,049\n \n\nAmounts paid during the year\n\n  \n \n(247,278\n)\n \n\nUnpaid amounts reversed during the year\n\n  \n \n(3,383\n)\n\nTranslation adjustment\n\n  \n \n25,028\n \n\n  \n\n \n\n \n\n \n\nBalance at end of the fiscal year\n\n  \n \n364,126\n \n\n  \n\n \n\n \n\n \n\nCurrent portion\n\n  \n \n223,233\n \n\nNon-current\nportion\n\n  \n \n140,893\n \n\n \n\n19.\n\nOther assets and other liabilities\n\n \n\n(1)\n\nOther assets\n\nComponents of other assets as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n \n\n2026\n\n \n\nAdvance payments and prepaid expenses\n\n  \n \n668,544\n \n \n \n778,982\n \n\nIncome taxes receivable and other taxes receivable\n\n  \n \n203,310\n \n \n \n236,961\n \n\nNet defined benefit assets\n\n  \n \n86,914\n \n \n \n129,765\n \n\nInsurance contract assets*\n\n  \n \n47,715\n \n \n \n-\n \n\nOther\n\n  \n \n180,655\n \n \n \n162,892\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n  1,187,138\n \n \n \n  1,308,600\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent assets\n\n  \n \n621,209\n \n \n \n663,678\n \n\nNon-current\nassets\n\n  \n \n565,929\n \n \n \n644,922\n \n\n \n\n*\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance as of March 31, 2026.\n\n \n\nF-8\n\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(2)\n\nOther liabilities\n\nComponents of other liabilities as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2025\n\n \n \n\n2026\n\n \n\nAccrued short-term employee benefits\n\n  \n \n486,678\n \n \n \n497,520\n \n\nRefund liabilities\n\n  \n \n193,103\n \n \n \n205,182\n \n\nTaxes payable other than income taxes\n\n  \n \n165,150\n \n \n \n157,714\n \n\nAccrued expenses\n\n  \n \n255,697\n \n \n \n273,255\n \n\nInsurance contract liabilities*\n\n  \n \n181,332\n \n \n \n-\n \n\nOther long-term employee benefit obligations\n\n  \n \n73,622\n \n \n \n61,454\n \n\nProduct warranties\n\n  \n \n21,376\n \n \n \n21,709\n \n\nOther\n\n  \n \n234,091\n \n \n \n290,350\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n   1,611,049\n \n \n \n   1,507,184\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent liabilities\n\n  \n \n1,448,402\n \n \n \n1,350,951\n \n\nNon-current\nliabilities\n\n  \n \n162,647\n \n \n \n156,233\n \n\nAs described in Note 2 (5), “Contract liabilities,” which had previously been included within “Other current liabilities,” have increased in materiality and are presented separately in the consolidated statements of financial position from the fiscal year ended March 31, 2026. As a result of this change, “Contract liabilities” are excluded from the current liabilities presented in the table above.\n\n \n\n*\n\nAs a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, there is no balance as of March 31, 2026.\n\nThe changes in product warranties for the fiscal year ended March 31, 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\n  Fiscal year ended March 31  \n\n \n\n \n  \n\n2026\n\n \n\nBalance at beginning of the fiscal year\n\n  \n \n21,376\n \n\n  \n\n \n\n \n\n \n\nAdditional product warranties\n\n  \n \n17,661\n \n\nAmounts used during the year\n\n  \n \n(18,923\n)\n\nUnused amounts reversed during the year\n\n  \n \n(574\n)\n \n\nTranslation adjustment\n\n  \n \n2,169\n \n\n  \n\n \n\n \n\n \n\nBalance at end of the fiscal year\n\n  \n \n21,709\n \n\n  \n\n \n\n \n\n \n\n \n\n20.\n\nStockholders’ equity\n\n \n\n(1)\n\nCommon stock\n\nThe number of shares of common stock authorized as of March 31, 2024 was 3,600,000,000 and as of March 31, 2025 and 2026 was 18,000,000,000.\n\nThe following table shows the changes in the number of shares of common stock issued and outstanding during the fiscal years ended March 31, 2024, 2025 and 2026. All of the shares of common stock of Sony Group Corporation are issued with no par value, and the issued stock was fully paid.\n\n \n\n \n  \n\nNumber of shares\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025*\n1\n\n \n \n\n2026\n\n \n\nBalance at beginning of the fiscal year\n\n  \n \n1,261,081,781\n \n  \n \n1,261,231,889\n \n \n \n6,149,810,645\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nIssuance of new shares\n\n  \n \n150,108\n \n  \n \n-\n \n \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDecrease by cancellation of treasury stock*\n2\n\n  \n \n-\n \n  \n \n(105,899,600\n) \n \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nIncrease by stock split\n\n  \n \n-\n \n  \n \n4,994,478,356\n \n \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance at end of the fiscal year\n\n  \n \n  1,261,231,889\n \n  \n \n  6,149,810,645\n \n \n \n  6,149,810,645\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nAs of October 1, 2024, Sony Group Corporation conducted a\n\nfive-for-one\n\nstock split of its common stock.\n\n*2\n\nIncluded in the number of shares that were decreased by cancellation of treasury stock for the fiscal year ended March 31, 2025 were 12,612,300 shares (before the stock split) cancelled on April 10, 2024 and 93,287,300 shares (after the stock split) cancelled on December 3, 2024.\n\n \n\nF-82\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nAs of March\n\n 31, 2024, 2025 and 2026, the number of shares of treasury stock, which was included in the balance of common stock shares issued above, were 39,783,003 shares, 124,806,850 shares and 242,143,391 shares, respectively.\n\nSony Group Corporation may purchase its own shares at any time by a resolution of the Board up to the retained earnings available for dividends to shareholders, in accordance with the Companies Act of Japan.\n\nThe Board resolved and approved the establishment of a facility for the repurchase of shares of its own common stock pursuant to the Companies Act of Japan and\n \n\nSony Group Corporation’s Articles of Incorporation as of May 10, 2022. Under the above resolution, Sony Group Corporation repurchased\n\n798,000\n\nshares of its common stock for an amount of\n\n \n10,000\n \n\nmillion yen during the fiscal year ended March 31, 2024. In addition, the Board resolved and approved the establishment of a facility for the repurchase of shares of its own common stock pursuant to the Companies Act of Japan and Sony Group Corporation’s Articles of Incorporation as of May 17, 2023. Under the above resolution, Sony Group Corporation repurchased\n\n14,869,300\nshares of its\n\nco\n\nmmon stock for an amount of\n192,532\n million yen during the fiscal year ended March 31, 2024, and repurchased\n572,400\nshares (before the stock split) of its common stock for an amount of\n7,468\n million yen during the fiscal year ended March 31, 2025.\n\nThe Board resolved and approved the establishment of a facility for the repurchase of shares of its own common stock pursuant to the Companies Act of Japan and Sony Group Corporation’s Articles of Incorporation as of May 14, 2024. Under the above resolution, Sony Group Corporation repurchased 93,287,300 shares (after the stock split) of its common stock for an amount of 250,000 million yen during the fiscal year ended March 31, 2025. In addition, the Board resolved and approved the establishment of a facility for the repurchase of shares of its own common stock pursuant to the Companies Act of Japan and Sony Group Corporation’s Articles of Incorporation as of February 13, 2025. Under the above resolution, Sony Group Corporation repurchased 7,715,800 shares of its common stock for an amount of 27,930 million yen during the fiscal year ended March 31, 2025, and repurchased 6,921,900 shares of its common stock for an amount of 22,069 million yen during the fiscal year ended March 31, 2026.\n\nThe Board resolved and approved the establishment of a facility for the repurchase of shares of its own common stock pursuant to the Companies Act of Japan and Sony Group Corporation’s Articles of Incorporation as of May 14, 2025. Under the above resolution, Sony Group Corporation repurchased 63,156,800 shares of its common stock for an amount of 250,000 million yen during the fiscal year ended March 31, 2026. In addition, the Board resolved and approved the establishment of a facility for the repurchase of shares of its own common stock pursuant to the Companies Act of Japan and Sony Group Corporation’s Articles of Incorporation as of November 11, 2025 (as subsequently amended in part by resolutions of the Board as of February 5, 2026 and February 26, 2026). Under the above resolution, Sony Group Corporation repurchased 70,793,900 shares of its common stock for an amount of 250,000 million yen during the fiscal year ended March 31,\n\n2026.\n\n \n\n(2)\n\nAdditional\npaid-in\ncapital\n\nAdditional\npaid-in\ncapital consists of surplus that is derived from equity transactions not recorded in common stock, and its components are capital reserves and capital surplus. The Companies Act of Japan provides that no less than\n50% of the\npaid-in\namount or proceeds of issuance of shares shall be incorporated in common stock, and that the remaining shall be incorporated in capital reserves. Capital reserves may be incorporated in common stock upon approval of the General Meeting of Shareholders.\n\n \n\n(3)\n\nRetained earnings\n\nRetained earnings consist of legal reserves and accumulated earnings. The Companies Act of Japan provides that earnings in an amount equal to 10% of cash dividends from retained earnings shall be appropriated as a capital reserve or a legal reserve on the date of distribution of retained earnings until an aggregated amount of capital reserve and legal reserve equals 25% of common stock. Legal reserves may be used upon approval of the General Meeting of Shareholders.\n\n \n\n(4)\n\nDividends\n\nDividends paid for the fiscal years ended March 31, 2025 and 2026 are as follows:\n\nFor the fiscal year ended March 31, 2025\n\n \n\n(Resolution)\n\n \n\nType of\n\nshares\n\n \n\nTotal amount of\n\ndividends\n\n(Yen in millions)\n\n \n \n\nSource of\n\ndividends\n\n \n \n\nDividends\n\nper share (Yen)\n\n \n \n\nRecord date\n\n \n \n\nEffective\n\ndate\n\n \n\nBoard of Directors\nMay 14, 2024\n\n \n\nCommon stock\n\n \n \n54,965\n \n \n \nRetained earnings\n \n \n \n45.00\n* \n \n \nMarch 31, 2024\n \n \n \nJune 10, 2024\n \n\nBoard of Directors\nNovember 7, 2024\n\n \n\nCommon stock\n\n \n \n60,347\n \n \n \nRetained earnings\n \n \n \n50.00\n\n*\n\n \n \nSeptember 30, 2024\n \n \n \nDecember 5, 2024\n \n\n* As of October 1, 2024, Sony Group Corporation conducted a\n\nfive-for-one\n\nstock split of its common stock. The dividend per share amount is the amount prior to the stock split.\n\n \n\nF-83\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nFor the fiscal year ended March 31, 2026\n\n \n\n(Resolution)\n\n \n\nType of\n\nshares\n\n \n\nTotal amount of\n\ndividends\n\n(Yen in millions)\n\n \n \n\nSource of\n\ndividends\n\n \n \n\nDividends\n\nper share (Yen)\n\n \n \n\nRecord date\n\n \n \n\nEffective\n\ndate\n\n \n\nBoard of Directors\nMay 14, 2025\n\n \n\nCommon stock\n\n \n \n60,250\n \n \n \nRetained earnings\n \n \n \n10.00\n \n \n \nMarch 31, 2025\n \n \n \nJune 2, 2025\n \n\nBoard of Directors\nNovember\n11\n, 2025\n\n \n\nCommon stock\n\n \n \n74,714\n \n \n \nRetained earnings\n \n \n \n12.50\n \n \n \nSeptember 30, 2025\n \n \n \nDecember 5, 2025\n \n\nDividends whose record date falls in the fiscal year ended March 31, 2026, and whose effective date falls in the subsequent period are as follows:\n\n \n\n(Resolution)\n\n \n\n  Type of  \n\nshares\n\n \n\nTotal amount of\n\ndividends\n\n(Yen in millions)\n\n \n\n \n\nSource of\n\ndividends\n\n \n\n \n\nDividends\n\nper share (Yen)\n\n \n\n \n\n  Record date  \n\n \n\n \n\n  Effective  \n\ndate\n\n \n\nBoard of Directors\nMay 8, 2026\n\n \n\nCommon stock\n\n \n \n73,846\n \n \n \nRetained earnings\n \n \n \n12.50\n \n \n \nMarch 31, 2026\n \n \n \nJune 1, 2026\n \n\n \n\n(5)\n\nDividends in kind\n\nUpon execution of the Partial Spin-off of the Financial\n\n Services business, Sony Group Corporation distributed dividends in kind to shareholders appearing in Sony Group Corporation’s register of shareholders as of the record date, September 30, 2025, at the rate of one share of common stock of SFGI (“SFGI share(s)”) to one share of common stock of Sony Group Corporation held by each shareholder, effective October 1, 2025. The dividend was paid out of retained earnings, and the amount equal to the fair value of the SFGI shares distributed as dividends in kind based on IFRS Accounting\n\nStandards was\n\n955,700\n\n million\n\nyen, with a dividend amount per share of\n \n\n159.89\nyen.\n\n \n\nF-8\n\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(6)\n\nOther comprehensive income\n\nChanges in accumulated other comprehensive income, net of tax, by component for the fiscal years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nBalance at\n\nApril 1, 2023\n\n \n \n\nOther\ncomprehensive\nincome\nattributable to\nSony Group\nCorporation’s\nstockholders\n\n \n \n\nTransfer to\nretained\nearnings\n\n \n \n\nBalance at\n\nMarch 31,\n2024\n\n \n\nChanges in equity instruments measured at fair value through other comprehensive income*\n\n  \n \n(9,152\n) \n \n \n(53,814\n) \n \n \n(12,326\n) \n \n \n(75,292\n) \n\nChanges in debt instruments measured at fair value through other comprehensive income*\n\n  \n \n39,845\n \n \n \n(704,636\n) \n \n \n-\n \n \n \n(664,791\n) \n\nCash flow hedges\n\n  \n \n18,413\n \n \n \n1,352\n \n \n \n-\n \n \n \n19,765\n \n\nRemeasurement of defined benefit pension plans*\n\n  \n \n-\n \n \n \n25,875\n \n \n \n(25,875\n) \n \n \n-\n \n\nExchange differences on translating foreign operations\n\n  \n \n513,203\n \n \n \n439,490\n \n \n \n-\n \n \n \n952,693\n \n\nInsurance finance income (expenses)*\n\n  \n \n(1,183,634\n) \n \n \n563,396\n \n \n \n-\n \n \n \n(620,238\n) \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n  \n \n6,563\n \n \n \n5,348\n \n \n \n(20\n) \n \n \n11,891\n \n\nOther*\n\n  \n \n192\n \n \n \n(283\n) \n \n \n-\n \n \n \n(91\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n(614,570\n) \n \n \n276,728\n \n \n \n(38,221\n) \n \n \n(376,063\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nBalance at\n\nApril 1, 2024\n\n \n \n\nOther\ncomprehensive\nincome\nattributable to\nSony Group\nCorporation’s\nstockholders\n\n \n \n\nTransfer to\nretained\nearnings\n\n \n \n\nBalance at\n\nMarch 31,\n2025\n\n \n\nChanges in equity instruments measured at fair value through other comprehensive income*\n\n  \n \n(75,292\n) \n \n \n(12,531\n) \n \n \n29,508\n \n \n \n(58,315\n) \n\nChanges in debt instruments measured at fair value through other comprehensive income*\n\n  \n \n(664,791\n) \n \n \n(681,515\n) \n \n \n-\n \n \n \n(1,346,306\n) \n\nCash flow hedges\n\n  \n \n19,765\n \n \n \n(4,295\n) \n \n \n-\n \n \n \n15,470\n \n\nRemeasurement of defined benefit pension plans*\n\n  \n \n-\n \n \n \n10,583\n \n \n \n(10,583\n) \n \n \n-\n \n\nExchange differences on translating foreign operations\n\n  \n \n952,693\n \n \n \n(79,179\n) \n \n \n-\n \n \n \n  873,514\n \n\nInsurance finance income (expenses)*\n\n  \n \n(620,238\n) \n \n \n568,291\n \n \n \n(8,738\n) \n \n \n(60,685\n) \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n  \n \n11,891\n \n \n \n(1,248\n) \n \n \n(1\n) \n \n \n10,642\n \n\nOther*\n\n  \n \n(91\n) \n \n \n(676\n) \n \n \n-\n \n \n \n(767\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n(376,063\n) \n \n \n(200,570\n) \n \n \n10,186\n \n \n \n(566,447\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-8\n\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nBalance at\n\nApril 1,\n2025\n\n \n\n \n\nOther\ncomprehensive\nincome\nattributable to\nSony Group\nCorporation’s\nstockholders\n\n \n\n \n\nTransfer to\nretained\nearnings\n\n \n\n \n\nTransactions\nwith\nnoncontrolling\ninterests\nshareholders\nand other\n\n \n\n \n\nTransfer to\nheld for\ndistribution\nto owners\n\n \n\n \n\nBalance at\n\nMarch 31,\n2026\n\n \n\nChanges in equity instruments measured at fair value through other comprehensive income*\n\n \n \n(58,315\n)\n \n \n(21,201\n)\n \n \n(91\n)\n \n\n-\n\n \n\n4,747\n\n \n \n(74,860\n)\n \n\nChanges in debt instruments measured at fair value through other comprehensive income*\n\n \n \n(1,346,306\n)\n \n\n(262,844\n\n) \n\n \n \n-\n \n \n \n-\n \n \n\n1,609,300\n\n \n \n150\n \n\nCash flow hedges\n\n \n \n15,470\n \n \n\n(3,384\n\n) \n\n \n \n-\n \n \n \n-\n \n \n\n-\n\n \n \n12,086\n \n\nRemeasurement of defined benefit pension plans*\n\n \n \n-\n \n \n\n38,184\n\n \n \n(38,184\n)\n \n\n \n \n-\n \n \n\n-\n\n \n \n-\n \n\nExchange differences on translating foreign operations\n\n \n \n873,514\n \n \n\n423,701\n\n \n \n-\n \n \n \n\n5,207\n\n \n \n\n-\n\n \n \n1,302,422\n \n\nInsurance finance income (expenses)*\n\n \n \n(60,685\n)\n \n\n228,593\n\n \n \n-\n \n \n \n-\n \n \n\n(167,908\n\n)\n \n\n \n \n-\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n \n \n10,642\n \n \n\n(21,039\n\n) \n\n \n \n(30\n)\n \n \n-\n \n \n\n-\n\n \n \n(10,427\n)\n\nOther*\n\n \n \n(767\n)\n \n\n \n \n(206\n)\n \n \n-\n \n \n\n-\n\n \n\n973\n\n \n \n-\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n \n(566,447\n)\n \n \n381,804\n\n \n \n(38,305)\n \n \n\n5,207\n\n \n \n\n1,447,112\n\n \n \n \n1,229,371\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*\n\nSome or all of the amounts are included in other comprehensive income from discontinued operations. For further information on discontinued operations, refer to Note 33.\n\n \n\nF-8\n\n6\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nEach component of other comprehensive income and the related tax effect including noncontrolling interests for the fiscal years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\nComprehensive income components\n\n  \n\n  2024  \n\n \n \n\n  2025  \n\n \n \n\n  2026  \n\n \n\nItems that will not be reclassified to profit or loss\n\n  \n\n \n\n \n\nChanges in equity instruments measured at fair value through other comprehensive income\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(72,245\n)\n \n \n(15,131\n)\n \n \n(27,915\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n(72,245\n)\n \n \n(15,131\n)\n \n \n(27,915\n)\n\nTax expense or (benefit)\n\n  \n \n17,418\n \n \n \n3,598\n \n \n \n6,514\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n(54,827\n)\n \n\n \n \n(11,533\n)\n \n \n(21,401\n)\n\nRemeasurement of defined benefit pension plans\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n38,875\n \n \n \n15,865\n \n \n \n51,235\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n38,875\n \n \n \n15,865\n \n \n \n51,235\n \n\nTax expense or (benefit)\n\n  \n \n(11,831\n)\n \n \n(4,838\n)\n \n \n(13,014\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n27,044\n \n \n \n11,027\n \n \n \n38,221\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n704\n \n \n \n(1,287\n)\n \n \n297\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n704\n \n \n \n(1,287\n)\n \n \n297\n \n\nTax expense or (benefit)\n\n  \n \n(91\n)\n \n \n376\n \n \n \n(54\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n613\n \n \n \n(911\n)\n \n \n243\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nOther comprehensive income from discontinued operations\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(243\n) \n \n \n(2,208\n) \n \n \n1,239\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n(243\n) \n \n \n(2,208\n) \n \n \n1,239\n \n\nTax expense or (benefit)\n\n  \n \n87\n \n \n \n766\n \n \n \n(382\n)\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n(156\n) \n \n \n(1,442\n) \n \n \n857\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n(27,326\n)\n \n\n \n \n(2,859\n)\n \n\n \n \n17,920\n \n\nItems that may be reclassified subsequently to profit or loss\n\n  \n\n \n\n \n\nCash flow hedges\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(15,032\n) \n \n \n(5,384\n) \n \n \n(7,416\n)\n\nReclassification to profit or loss\n\n  \n \n16,982\n \n \n \n433\n \n \n \n2,829\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n1,950\n \n \n \n(4,951\n) \n \n \n(4,587\n)\n\nTax expense or (benefit)\n\n  \n \n(598\n) \n \n \n656\n \n \n \n1,203\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n1,352\n \n \n \n(4,295\n) \n \n \n(3,384\n)\n\nExchange differences on translating foreign operations\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n441,943\n \n \n \n(78,193\n) \n \n \n415,503\n \n\nReclassification to profit or loss\n\n  \n \n463\n \n \n \n(1,073\n) \n \n \n8,857\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n442,406\n \n \n \n(79,266\n) \n \n \n424,360\n \n\nTax expense or (benefit)\n\n  \n \n-\n \n \n \n-\n \n \n \n-\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n442,406\n \n \n \n(79,266\n) \n \n \n424,360\n \n\n \n\nF-\n8\n\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\nComprehensive income components\n\n  \n\n  2024  \n\n \n \n\n  2025  \n\n \n \n\n  2026  \n\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n4,735\n \n \n \n(337\n) \n \n \n(23,378\n)\n\nReclassification to profit or loss\n\n  \n \n-\n \n \n \n-\n \n \n \n358\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n4,735\n \n \n \n(337\n) \n \n \n(23,020\n)\n\nTax expense or (benefit)\n\n  \n \n-\n \n \n \n-\n \n \n \n1,738\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n4,735\n \n \n \n(337\n) \n \n \n(21,282\n)\n\nOther comprehensive income from discontinued operations\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(191,775\n)\n \n \n(188,264\n)\n \n \n(59,771\n)\n \n\nReclassification to profit or loss\n\n  \n \n\n(4,713\n\n)\n \n \n \n\n4,537\n\n \n \n \n\n1,451,335\n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal before tax\n\n  \n \n(196,488\n)\n \n \n(183,727\n)\n \n \n1,391,564\n \n\nTax expense or (benefit)\n\n  \n \n54,965\n \n \n \n69,827\n \n \n \n16,343\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet of tax\n\n  \n \n(141,523\n)\n \n \n(113,900\n)\n \n \n1,407,907\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n306,970\n \n \n \n(197,798\n) \n \n \n1,807,601\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal other comprehensive income\n\n  \n \n279,644\n \n \n \n(200,657\n) \n \n \n1,825,521\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n21.\n\nStock-based compensation plans\n\nThe stock-based compensation expense for the fiscal years ended March 31, 2024, 2025 and 2026 was 21,657 million yen, 29,416 million yen and 39,102 million yen, respectively.\n\nThe above amounts include expenses related to the Financial Services business. In connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, expenses related to the Financial Services business are included in net income (loss) from discontinued operations in the consolidated statements of income.\n\nSony Group Corporation has stock-based compensation plans primarily in the form of a stock option plan for Corporate Executive Officers and employees of Sony Group Corporation, and the directors, other officers and employees of its subsidiaries, and a restricted stock unit plan (the “RSU Plan”) for Directors, Senior Executives, other officers and employees of Sony Group Corporation, and the directors, other officers and employees of its subsidiaries.\n\n \n\n(1)\n\nStock option plan\n\nThe stock acquisition rights granted under the stock option plan primarily have a three-year vesting schedule and are exercisable up to 10 years from the date of grant. Sony Group Corporation either issues new shares of common stock or reissues existing treasury stock upon the exercise of these rights.\n\nAs of October 1, 2024, Sony Group Corporation conducted a\n\nfive-for-one\n\nstock split of its common stock. The following weighted-average fair value per share at the date of grant of stock acquisition rights, the number of shares, the weighted-average exercise price, the weighted-average stock price at the time when the stock acquisition rights were exercised, the exercise price and the balance of unexercised stock acquisition rights at the end of the fiscal year are calculated assuming that the stock split was implemented at the beginning of the fiscal year ended March 31, 2024.\n\nAs a result of the execution of the Partial Spin-off of the Financial Services business, Sony Group Corporation adjusted the exercise prices of its stock acquisition rights. The adjustment did not result in a material increase in the fair value per share.\n\n \n\nF-\n8\n\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe fair value of stock acquisition rights on the date of grant and used to recognize compensation expense for the fiscal years ended March 31, 2024, 2025 and 2026 was estimated using the Black-Scholes model, and the weighted-average fair value per share right at the date of grant of stock acquisition rights granted during the fiscal years ended March 31, 2024, 2025 and 2026 was 733 yen, 875 yen and 1,386 yen, respectively. A summary of the activities regarding the stock option plan during the fiscal years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\n \n \n\nNumber of\n\nshares\n\n \n\n \n \n\nWeighted-\n\naverage\nexercise\n\nprice\n\n \n \n\nNumber of\n\nshares\n\n \n\n \n \n\nWeighted-\n\naverage\nexercise\n\nprice\n\n \n \n\nNumber of\n\nshares\n\n \n\n \n \n\nWeighted-\n\naverage\nexercise\n\nprice\n\n \n\n \n \n\nYen\n\n \n \n\nYen\n\n \n \n\nYen\n\n \n\nOutstanding at beginning of the fiscal year\n\n \n \n98,457,500\n \n \n \n2,062\n \n \n \n97,809,500\n \n \n \n2,330\n \n \n \n81,169,300\n \n \n \n2,442\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\nGranted\n\n \n \n12,190,500\n \n \n \n2,533\n \n \n \n4,302,800\n \n \n \n2,927\n \n \n \n2,977,000\n \n \n \n4,461\n \n\nExercised\n\n \n \n(10,608,500\n)\n \n \n1,359\n \n \n \n(18,930,500\n)\n \n \n1,843\n \n \n \n(18,290,600\n)\n \n \n2,291\n \n\nForfeited or expired\n\n \n \n(2,230,000\n)\n \n \n2,660\n \n \n \n(2,012,500\n)\n \n \n2,796\n \n \n \n(840,800\n)\n \n \n2,631\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\nOutstanding at end of the fiscal year\n\n \n \n97,809,500\n \n \n \n2,330\n \n \n \n81,169,300\n \n \n \n2,442\n \n \n \n65,014,900\n \n \n \n2,595\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n\nExercisable at end of the fiscal year\n\n \n \n59,409,500\n \n \n \n2,166\n \n \n \n59,515,500\n \n \n \n2,403\n \n \n \n54,224,900\n \n \n \n2,465\n \n\nThe weighted-average stock price at the time when the stock acquisition rights were exercised during the fiscal years ended March 31, 2024, 2025 and 2026 was 2,629 yen, 3,238 yen and 4,017 yen, respectively.\n\n \n\nF-\n8\n\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nA summary of unexercised stock acquisition rights as of March 31, 2024, 2025 and 2026 is as follows:\n\n \n\nSeries\n\n \n\nDate of grant\n\n \n\nExercise term\n\n \n\nExercise price\n\n \n \n\nOutstanding at end of the\n\nfiscal year\n\n(shares)\n\n \n\n \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\n28\nth\n\n \nNovember 20, 2014\n \n\nNovember 20, 2015\n\nto November 19, 2024\n\n \n¥\n483\n \n \n \n417,500\n \n \n \n-\n \n \n \n-\n \n\n29\nth\n\n \nNovember 20, 2014\n \n\nNovember 20, 2015\n\nto November 19, 2024\n\n \n$\n4.14\n \n \n \n613,500\n \n \n \n-\n \n \n \n-\n \n\n30\nth\n\n \nNovember 19, 2015\n \n\nNovember 19, 2016\n\nto November 18, 2025\n\n \n¥\n681\n \n \n \n445,000\n \n \n \n230,500\n \n \n \n-\n \n\n31\nst\n\n \nNovember 19, 2015\n \n\nNovember 19, 2016\n\nto November 18, 2025\n\n \n$\n4.68\n \n \n \n656,500\n \n \n \n337,000\n \n \n \n-\n \n\n32\nnd\n\n \nNovember 22, 2016\n \n\nNovember 22, 2017\n\nto November 21, 2026\n\n \n¥\n673\n \n \n \n1,157,000\n \n \n \n755,500\n \n \n \n404,500\n \n\n33\nrd\n\n \nNovember 22, 2016\n \n\nNovember 22, 2017\n\nto November 21, 2026\n\n \n$\n5.39\n \n \n \n1,430,500\n \n \n \n983,000\n \n \n \n476,500\n \n\n34\nth\n\n \nNovember 21, 2017\n \n\nNovember 21, 2018\n\nto November 20, 2027\n\n \n¥\n1,047\n \n \n \n1,401,000\n \n \n \n944,500\n \n \n \n629,000\n \n\n35\nth\n\n \nNovember 21, 2017\n \n\nNovember 21, 2018\n\nto November 20, 2027\n\n \n$\n8.32\n \n \n \n2,528,500\n \n \n \n1,486,500\n \n \n \n1,005,000\n \n\n36\nth\n\n \nFebruary 28, 2018\n \n\nFebruary 28, 2019\n\nto February 27, 2028\n\n \n¥\n1,089\n \n \n \n7,500\n \n \n \n4,500\n \n \n \n3,000\n \n\n38\nth\n\n \nNovember 20, 2018\n \n\nNovember 20, 2019\n\nto November 19, 2028\n\n \n¥\n1,288\n \n \n \n2,983,500\n \n \n \n2,308,500\n \n \n \n1,681,000\n \n\n39\nth\n\n \nNovember 20, 2018\n \n\nNovember 20, 2019\n\nto November 19, 2028\n\n \n$\n10.42\n \n \n \n3,271,500\n \n \n \n1,926,500\n \n \n \n1,326,500\n \n\n40\nth\n\n \nNovember 20, 2019\n \n\nNovember 20, 2020\n\nto November 19, 2029\n\n \n¥\n1,341\n \n \n \n4,373,000\n \n \n \n2,799,000\n \n \n \n1,706,000\n \n\n41\nst\n\n \nNovember 20, 2019\n \n\nNovember 20, 2020\n\nto November 19, 2029\n\n \n$\n11.37\n \n \n \n4,582,000\n \n \n \n2,736,000\n \n \n \n2,356,000\n \n\n43\nrd\n\n \nNovember 18, 2020\n \n\nNovember 18, 2021\n\nto November 17, 2030\n\n \n¥\n1,848\n \n \n \n8,270,000\n \n \n \n6,386,000\n \n \n \n4,247,000\n \n\n44\nth\n\n \nNovember 18, 2020\n \n\nNovember 18, 2021\n\nto November 17, 2030\n\n \n$\n16.67\n \n \n \n8,573,000\n \n \n \n5,641,000\n \n \n \n4,117,500\n \n\n45\nth\n\n \nNovember 18, 2021\n \n\nNovember 18, 2022\n\nto November 17, 2031\n\n \n¥\n2,870\n \n \n \n11,656,000\n \n \n \n10,635,000\n \n \n \n7,535,500\n \n\n46\nth\n\n \nNovember 18, 2021\n \n\nNovember 18, 2022\n\nto November 17, 2031\n\n \n$\n24.15\n \n \n \n10,689,000\n \n \n \n10,119,500\n \n \n \n7,206,000\n \n\n47\nth\n\n \nNovember 16, 2022\n \n\nNovember 16, 2023\n\nto November 15, 2032\n\n \n¥\n2,278\n \n \n \n12,006,000\n \n \n \n10,686,500\n \n \n \n8,823,000\n \n\n48\nth\n\n \nNovember 16, 2022\n \n\nNovember 16, 2023\n\nto November 15, 2032\n\n \n$\n14.75\n \n \n \n10,620,000\n \n \n \n7,836,500\n \n \n \n6,079,500\n \n\n49\nth\n\n \nNovember 27, 2023\n \n\nNovember 27, 2024\n\nto November 26, 2033\n\n \n¥\n2,589\n \n \n \n6,471,000\n \n \n \n6,392,000\n \n \n \n5,950,500\n \n\n50\nth\n\n \nNovember 27, 2023\n \n\nNovember 27, 2024\n\nto November 26, 2033\n\n \n$\n16.27\n \n \n \n5,657,500\n \n \n \n4,658,500\n \n \n \n4,292,500\n \n\n51\nst\n\n \nNovember 25, 2024\n \n\nNovember 25, 2025\n\nto November 24, 2034\n\n \n¥\n2,948\n \n \n \n-\n \n \n \n2,867,000\n \n \n \n2,844,800\n \n\n52\nnd\n\n \nNovember 25, 2024\n \n\nNovember 25, 2025\n\nto November 24, 2034\n\n \n$\n18.10\n \n \n \n-\n \n \n \n1,435,800\n \n \n \n1,362,100\n \n\n53\nrd\n\n \nNovember 25, 2025\n \n\nNovember 25, 2026\n\nto November 24, 2035\n\n \n¥\n4,512\n \n \n \n-\n \n \n \n-\n \n \n \n2,030,700\n \n\n54\nth\n\n \nNovember 25, 2025\n \n\nNovember 25, 2026\n\nto November 24, 2035\n\n \n$\n28.88\n \n \n \n-\n \n \n \n-\n \n \n \n938,300\n \n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, the exercise prices of certain stock acquisition rights that were previously issued for the purpose of granting stock options have been adjusted, and the above exercise prices are presented as the adjusted amounts.\n\n \n\nF-\n\n90\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(2)\n\nRestricted stock unit plan\n\nThe restricted stock units granted under the RSU Plan primarily have a three-year vesting schedule. Upon vesting, Sony Group Corporation promptly delivers shares of common stock corresponding to the number of units vested. Sony Group Corporation either issues new shares of common stock or reissues existing treasury stock upon delivering shares of common stock.\n\nAs of October 1, 2024, Sony Group Corporation conducted a\n\nfive-for-one\n\nstock split of its common stock. The following number of rights and the weighted-average fair value per share on the grant date are calculated assuming that the stock split was implemented at the beginning of the fiscal year ended March 31, 2024.\n\nIn connection with the execution of the Partial Spin-off of the Financial Services business, Sony Group Corporation adjusted the number of shares to be delivered upon the vesting of restricted stock units previously granted. The adjustment did not result in a material increase in the fair value per unit.\n\nA summary of the activities regarding the restricted stock unit plan during the fiscal years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\n \n  \n\nNumber of rights\n\n(share)\n*\n\n \n  \n\nNumber of rights\n\n(share)\n*\n\n \n  \n\nNumber of rights\n\n(share)\n*\n\n \n\nOutstanding at beginning of the fiscal year\n\n  \n \n2,443,150\n \n  \n \n8,255,925\n \n  \n \n15,089,851\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nUnits granted\n\n  \n \n6,913,640\n \n  \n \n10,215,944\n \n  \n \n8,885,104\n \n\nAdjustment of the number of shares to be delivered\n\n  \n \n-\n \n  \n \n-\n \n  \n \n493,816\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nVesting\n\n  \n \n(757,040\n)\n  \n \n(2,746,775\n)\n  \n \n(5,250,576\n)\n \n\nForfeited\n\n  \n \n(343,825\n)\n \n\n  \n \n(635,243\n)\n  \n \n(1,370,809\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nOutstanding at end of the fiscal year\n\n  \n \n   8,255,925\n \n  \n \n  15,089,851\n \n  \n \n   17,847,386\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n*\n\nThe outstanding number of rights (shares) at the beginning and end of the fiscal year represents the number of shares of Sony Group Corporation’s common stock to be delivered upon vesting of the restricted stock units.\n\nThe fair value of restricted stock units on the date of grant and used to recognize compensation expense for the fiscal years ended March 31, 2024, 2025 and 2026 was based on the closing price per share of common stock on the grant date, adjusted to reflect the expected dividends not received during the vesting period.\n\n The weighted-average fair value per share on the grant date of the restricted stock units during the fiscal years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nDate of grant\n \nJuly 25,\n2023\n \n \nNovember 27,\n2023\n \n \nJuly 25,\n2024\n \n \nNovember 25,\n2024\n \n \nJuly 25,\n2025\n \n \nNovember 25,\n2025\n \n\nThe weighted-average fair value (Yen)\n\n \n \n   2,587\n \n \n \n   2,532\n \n \n \n   2,644\n \n \n \n   2,944\n \n \n \n   3,663\n \n \n \n   4,351\n \n\n \n\n22.\n\nRevenue\n\n \n\n(1)\n\nContract balances\n\nReceivables from contracts with customers, contract assets and contract liabilities are comprised of the following:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nApril 1\n\n \n  \n\nMarch 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nReceivables from contracts with customers\n*1\n\n  \n \n1,931,631\n \n  \n \n1,736,079\n \n  \n \n1,783,627\n \n\nContract assets\n*2\n\n  \n \n17,820\n \n  \n \n7,973\n \n  \n \n4,233\n \n\nContract liabilities\n*3\n\n  \n \n534,432\n \n  \n \n632,912\n \n  \n \n639,022\n \n\n \n\n*1\n\nReceivables from contracts with customers are included in the consolidated statements of financial position as “Trade and other receivables, and contract assets” and “Other financial assets,”\nnon-current.\n\n*2\n\nContract assets are included in the consolidated statements of financial position as “Trade and other receivables, and contract assets” and “Other\nnon-current\nassets.”\n\n*3\n\nContract liabilities are included in the consolidated statements of financial position as “\nContract\nliabilities” and “Other\nnon-current\nliabilities.”\n\nContract liabilities principally relate to customer advances received prior to performance. Revenues of 444,964 million yen, 461,340 million yen and 561,184 million yen were recognized during the fiscal years ended March 31, 2024, 2025 and 2026, respectively, which were included in the balance of contract liabilities as of April 1, 2023, 2024 and 2025, respectively. The amount of revenue recognized from performance obligations satisfied or partially satisfied in the previous periods is not significant.\n\n \n\nF-9\n\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(2)\n\nPerformance obligations\n\nRemaining (unsatisfied or partially unsatisfied) performance obligations represent future revenues not yet recorded for firm orders that have not yet been performed. Sony applies practical expedients to exclude contracts with an expected original duration of one year or less. The following table shows the summary of the transaction prices allocated to remaining performance obligations that are unsatisfied as of March 31, 2025 and 2026, respectively, of which\n approximately\n\n \nhalf are expected to be recognized within one year and substantially all within three years. The amount of the transaction price related to variable consideration is included only to the extent that it is highly probable that a significant reversal in the amount of cumulative revenue to be recognized will not occur.\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n 2025 \n\n \n\n  \n\n 2026 \n\n \n\nPictures - Motion Pictures and Television Productions\n*1\n\n  \n\n \n\n  748,517\n\n \n\n  \n\n \n\n1,150,679\n\n \n\nPictures - Media Networks\n\n  \n\n \n\n9,094\n\n \n\n  \n\n \n\n18,656\n\n \n\nMusic\n*2\n\n  \n\n \n\n116,184\n\n \n\n  \n\n \n\n150,361\n\n \n \n \n\nOthers\n\n  \n\n \n\n69,587\n\n \n\n  \n\n \n\n 80,405\n\n \n\n*1 For Motion Pictures and Television Productions in the Pictures segment, Sony has included all contracts regardless of duration.\n\n*2 The amount included in the Music segment primarily consists of minimum royalty guarantees or fixed fees in contracts related to license revenue for ongoing access to an evolving library of content.\n\n  \n\n  \n\n \n\n(3)\n\nContract costs\n\nContract costs are comprised as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nIncremental costs of obtaining a contract\n\n  \n\n \n\n   12,901\n\n \n\n  \n\n \n\n   27,338\n\n \n\nSony\n \n\napplies practical expedients to recognize the incremental costs of obtaining a contract as an expense if the amortization period of the asset that otherwise would have been recognized is one year or less. The amortization of\n4,562\n million yen,\n2,380\n million yen and\n3,919\n million yen was recognized during the fiscal years ended March 31, 2024, 2025 and 2026, respectively. The incremental costs of obtaining a contract are primarily recognized in the ET&S segment for the internet-related service business and amortized to expense over the customer’s usage period for such service.\n\n \n\n(4)\n\nDisaggregation of revenue\n\nFor the breakdown of sales by segments, product categories and geographies, refer to Note 4.\n\n \n\n23.\n\nSupplemental consolidated statements of income information\n\n \n\n(1)\n\nOther operating (income) expense, net\n\nSony records transactions in other operating (income) expense, net due to either the nature of the transaction or in consideration of factors including the relationship to Sony’s core operations.\n\nOther operating (income) expense, net is comprised of the\nfollowing\n:\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nFiscal year ended March 31\n\n \n\n \n\n \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nRealization of unrealized gains on land transferred by Sony Group Corporation to Sony Life Insurance Co., Ltd. in past fiscal years, in connection with the execution of the Partial Spin-off of the Financial Services business\n\n \n \n-\n \n \n \n-\n \n \n \n(43,899\n)\n \n\nGain on remeasurement of previously existing equity interest in Peanuts Holdings\n*1\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(34,662\n\n)\n\n(Gain) loss on purchase/sale of interests in subsidiaries and associates, net\n\n \n \n(6,905\n) \n \n \n(18,426\n) \n \n \n1,860\n\n(Gain) loss on sale, disposal or impairment of assets, net\n*\n2\n\n \n \n(4,977\n) \n \n \n14,265\n \n \n \n118,690\n \n\nOther\n\n \n \n1,748\n \n \n \n(7,061\n) \n \n \n(7,933\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n \n(10,134\n) \n \n \n(11,222\n) \n \n \n34,056\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\nFor further details, refer to Note 30 (1).\n\n*2\n\nThe figures for the fiscal year ended March 31, 2026 mainly include impairment losses recognized on the non-financial assets of Bungie and Pixomondo. For further details, refer to Note 12.\n\n \n\nF-9\n2\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nIn connection with the Resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, income and loss from the Financial Services business is included in net income (loss) from discontinued operations in the consolidated statements of income. Consequently, the figures for comparative periods have been\nre-presented\ninto continuing operations and discontinued operations.\n\n \n\n(2)\n\nResearch and development expenditures\n\nResearch and development expenditures from continuing operations in the consolidated statements of income recognized as an expense for the fiscal years ended March 31, 2024, 2025 and 2026 were\n742,772 million yen, 734,578 million yen and 762,027 million yen, respectively.\n\n \n\n(3)\n\nAdvertising costs\n\nAdvertising costs included in selling, general and administrative expenses from continuing operations in the consolidated statements of income for the fiscal years ended March 31, 2024, 2025 and 2026 were\n422,655 million yen, 413,795 million yen and 440,073 million yen, respectively.\n\n \n\n(4)\n\nShipping and handling costs\n\nShipping and handling costs for finished goods included in selling, general and administrative expenses from continuing operations in the consolidated statements of income for the fiscal years ended March 31, 2024, 2025 and 2026 were\n85,108 million yen, 86,762 million yen and 79,462 million yen, respectively, which included the internal transportation costs of finished goods.\n\n \n\n24.\n\nFinancial income and expenses\n\nThe breakdown of financial income and\nexpenses\nfrom continuing operations in the consolidated statements of income is as follows:\n\nFinancial income\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nInterest income\n\n  \n\n  \n\n  \n\nFinancial assets measured at AC\n\n  \n \n37,580\n \n  \n \n50,925\n \n  \n \n62,872\n \n\nDividends\n\n  \n\n  \n\n  \n\nFinancial assets measured at FVOCI\n\n  \n \n1,138\n \n  \n \n1,390\n \n  \n \n2,995\n \n\nGain on revaluation of equity instruments\n\n  \n\n  \n\n  \n\nFinancial assets measured at FVPL\n*2\n\n  \n \n71,385\n \n  \n \n77,755\n \n  \n \n2,636\n \n\nOther\n\n  \n \n15,494\n \n  \n \n8,954\n \n  \n \n7,538\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n125,597\n \n  \n \n139,024\n \n  \n \n76,041\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nFinancial expenses\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nInterest expenses\n\n  \n\n  \n\n  \n\nFinancial liabilities measured at AC\n\n  \n \n28,163\n \n  \n \n25,476\n \n  \n \n18,249\n \n\nOther\n\n  \n \n12,833\n \n  \n \n15,400\n \n  \n \n17,326\n \n\nForeign exchange loss, net\n*1\n\n  \n \n6,989\n \n  \n \n1,902\n \n  \n \n30,181\n \n\nOther\n\n  \n \n17,781\n \n  \n \n29,683\n \n  \n \n35,418\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n65,766\n \n  \n \n 72,461\n \n  \n \n101,174\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n*1\n\nForeign exchange loss, net includes gains or losses from foreign exchange contracts.\n\n*2\n\nShares of Spotify Technology S.A. (“Spotify”) held by Sony are classified as equity securities required to be measured at fair value through profit or loss. The revaluation of the Spotify shares, which reflects costs to be paid to Sony’s artists and distributed labels as well as the changes in the fair value of derivatives utilized to hedge exposure to market fluctuation risk, owned as of March 31, 2024, 2025 and 2026 resulted in an unrealized\ngain\nof 64,764 million yen (440 million U.S. dollars), 69,019 million yen (443 million U.S. dollars) and 9,919 million yen (74 million U.S. dollars), respectively.\n\n \n\nF-9\n\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n25.\n\nIncome taxes\n\nIncome (loss) before income taxes and the provision for current and deferred income taxes attributable to such income are as follows. In connection with the Resolution for the plan regarding the execution of the Partial Spin-off of the Financial Services business, the Financial Services business was classified as a discontinued operation. Therefore, the income (loss) before income taxes and income tax expenses of the Financial Services business are included in net income(loss) from discontinued operations. Accordingly, comparative periods have been re-presented to reflect this change.\n\n \n\n \n \n \n \n \n \n \n \n \n \n \n \n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nFiscal year ended March 31\n\n \n\n \n\n \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nIncome (loss) before income taxes:\n\n \n \n1,095,086\n \n \n \n1,343,198\n \n \n \n1,422,374\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nIncome tax expenses\n\n \n\n \n\n \n\nCurrent\n\n \n \n255,375\n \n \n \n275,376\n \n \n \n326,555\n \n\nDeferred\n\n \n \n(16,270\n)\n \n\n \n \n(17,896\n)\n \n\n \n \n40,553\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal income tax expense\n\n \n \n  239,105\n \n \n \n  257,480\n \n \n \n367,108\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFor the fiscal year ended March 31, 2024, 2025 and 2026 the domestic components of the amount of income tax expenses were 120,758 million yen, 64,219 million yen and 171,666 million yen, respectively, and the foreign components of the amount of income tax expenses were 118,347 million yen, 193,261 million yen and 195,442 million yen, respectively.\n\nIncome tax expenses for the fiscal year ended March 31, 2025 included the impact of decreases in tax expense from the repayment of capital from a subsidiary and the dissolution of a subsidiary. The amounts of decreases were 48,373 million yen and 35,278 million yen, respectively.\n\nA reconciliation of the differences between the Japanese statutory tax rate and the effective tax rate for continuing operations is as follows:\n\n \n\n \n \n\nFiscal year ended March 31\n\n \n\n \n \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nStatutory tax rate\n\n \n \n  31.5\n% \n \n \n  31.5\n% \n \n \n31.5\n% \n\nNon-deductible\nexpenses\n\n \n \n0.3\n \n \n \n0.4\n \n \n \n0.6\n \n\nIncome tax credits\n\n \n \n(3.8\n) \n \n \n(1.5\n) \n \n \n(2.2\n)\n\nChange in statutory tax rate\n\n \n \n0.1\n \n \n \n0.0\n \n \n \n0.0\n \n\nChange in unrecognized deferred tax assets\n\n \n \n(2.5\n) \n \n \n(5.7\n) \n \n \n0.2\n \n\nChange in deferred tax liabilities on undistributed earnings of foreign subsidiaries and affiliates\n\n \n \n1.0\n \n \n \n0.4\n \n \n \n0.6\n \n\nForeign income tax differential\n\n \n \n(5.6\n) \n \n \n(6.5\n) \n \n \n(4.6\n)\n\nRecording or reversal of liabilities for uncertain tax positions\n\n \n \n0.2\n \n \n \n0.1\n \n \n \n(0.5\n)\n\nControlled Foreign Company taxation in Japan\n\n \n \n0.1\n \n \n \n0.1\n \n \n \n0.1\n \n\nOther\n\n \n \n0.5\n \n \n \n0.4\n \n \n \n0.1\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nEffective income tax rate\n\n \n \n21.8\n% \n \n \n19.2\n% \n \n \n25.8\n% \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSony recognizes deferred tax assets, which include temporary differences, net operating losses and tax credits, to the extent that it is probable that taxable profit will be available against which the assets can be utilized. The realization of deferred tax assets is dependent upon the generation of future taxable income in the relevant tax jurisdiction.\n\nIn Japan, the Act for Partial Amendment of Income Tax Act, etc. (Act No. 13 of 2025) was promulgated on March 31, 2025, according to which the corporate tax rate will increase from the fiscal year beginning on or after April 1, 2026. As a result, the statutory tax rate from the fiscal year ending March 31, 2027 and thereafter will be approximately 32.3%.\n\n \n\nF-9\n\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nThe schedules of deferred tax assets and liabilities by major cause of their occurrence are as follows:\n\n \n\n \n \n\nYen in millions\n\n \n\n \n \n\nFiscal year ended March 31, 2025\n\n \n\n \n \n\nBeginning\nbalance\n\n \n \n\nRecognized\nin profit or\nloss\n\n \n \n\nRecognized in\nother\ncomprehensive\nincome\n\n \n \n\nChanges\naccompanying\nbusiness\ncombination\n\n \n \n\nRecognized\ndirectly in\nequity\n\n \n \n\nOther\n*1\n\n \n \n\nEnding\nbalance\n\n \n\nDeferred tax assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOperating loss carryforwards for tax purposes\n\n \n \n77,541\n \n \n \n2,270\n \n \n \n(2\n) \n \n \n567\n \n \n \n-\n \n \n \n1,015\n \n \n \n81,391\n \n\nDefined benefit liabilities\n\n \n \n75,547\n \n \n \n(475\n) \n \n \n(4,550\n) \n \n \n-\n \n \n \n-\n \n \n \n(7,549\n) \n \n \n62,973\n \n\nAmortization including content assets\n\n \n \n19,619\n \n \n \n8,903\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(450\n) \n \n \n28,072\n \n\nLease liabilities\n\n \n \n135,730\n \n \n \n10,457\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(10,913\n) \n \n \n135,274\n \n\nWarranty reserves and accrued expenses\n\n \n \n167,402\n \n \n \n11,737\n \n \n \n-\n \n \n \n3\n \n \n \n-\n \n \n \n(4,370\n) \n \n \n174,772\n \n\nInventories\n\n \n \n48,807\n \n \n \n(3,504\n) \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n1,174\n \n \n \n46,477\n \n\nDepreciation\n\n \n \n41,603\n \n \n \n(477\n) \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(2,232\n) \n \n \n38,894\n \n\nEquity securities measured at FVPL\n\n \n \n19,240\n \n \n \n(9,781\n) \n \n \n4,076\n \n \n \n-\n \n \n \n-\n \n \n \n(669\n) \n \n \n12,866\n \n\nDebt securities measured at FVOCI\n\n \n \n382,527\n \n \n \n4,309\n \n \n \n289,625\n \n \n \n-\n \n \n \n-\n \n \n \n(100,198\n) \n \n \n576,263\n \n\nTax credit carryforwards\n\n \n \n57,646\n \n \n \n4,219\n \n \n \n-\n \n \n \n57\n \n \n \n-\n \n \n \n(325\n) \n \n \n61,597\n \n\nLoss allowances\n\n \n \n10,741\n \n \n \n152\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n1,110\n \n \n \n12,003\n \n\nImpairment of investments\n\n \n \n7,780\n \n \n \n51,863\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(5,435\n) \n \n \n54,208\n \n\nDeferred revenue\n\n \n \n48,454\n \n \n \n24,147\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(1\n) \n \n \n72,600\n \n\nResearch and development expenditures\n*2\n\n \n\n \n\n75,323\n\n \n\n \n\n \n\n26,992\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(1,371\n\n)\n \n\n \n\n \n\n100,944\n\n \n\nOther\n*2\n\n \n \n236,976\n \n \n \n38,527\n \n \n \n656\n \n \n \n523\n \n \n \n3,125\n \n \n \n115,467\n \n \n \n395,274\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal deferred tax assets\n\n \n \n1,404,936\n \n \n \n169,339\n \n \n \n289,805\n \n \n \n  1,150\n \n \n \n3,125\n \n \n \n(14,747\n)\n \n \n1,853,608\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDeferred tax liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInsurance contract liabilities\n\n \n \n(499,709\n) \n \n \n(67,854\n) \n \n \n(219,798\n) \n \n \n-\n \n \n \n-\n \n \n \n67,524\n \n \n \n(719,837\n) \n\nRight-of-use\n\nassets\n\n \n \n(113,240\n) \n \n \n(8,529\n) \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n1,239\n \n \n \n(120,530\n) \n\nEquity securities measured at FVPL\n\n \n \n(52,334\n) \n \n \n(48,477\n) \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n660\n \n \n \n(100,151\n) \n\nIntangible assets acquired through stock exchange offerings\n\n \n \n(23,949\n) \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(23,949\n) \n\nIntangible assets acquired through business combinations\n*3\n\n \n \n(193,054\n)\n \n \n15,287\n\n \n \n-\n \n \n \n(6,842\n\n)\n \n \n \n-\n \n \n \n2,322\n \n \n \n(182,287\n)\n\nUndistributed earnings of foreign subsidiaries and affiliates\n\n \n \n(84,951\n) \n \n \n(16,303\n) \n \n \n19\n \n \n \n-\n \n \n \n-\n \n \n \n2,009\n \n \n \n(99,226\n) \n\nInvestment in M3, Inc.\n\n \n \n(52,625\n) \n \n \n(4,346\n) \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n-\n \n \n \n(56,971\n) \n\nOther\n*3\n\n \n \n(51,948\n)\n \n \n(60,669\n)\n \n \n376\n \n \n \n2,140\n \n \n \n7\n \n \n \n(56,507\n)\n \n \n(166,601\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal deferred tax liabilities\n\n \n \n(1,071,810\n)\n \n \n(190,891\n)\n \n \n(219,403\n)\n \n \n(4,702\n)\n \n \n7\n \n \n \n17,247\n \n \n \n(1,469,552\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\n“Other” includes exchange differences on translating foreign operations and others.\n\n*2\n\n“Research and development expenditures,” which were included within “Other” in the fiscal year ended March 31, 2025, have increased in materiality and have been reclassified and presented separately, starting from the fiscal year ended March 31, 2026. As a result of this change, “Research and development expenditures,” which were included within “Other” in the fiscal year ended March 31, 2025, have been reclassified.\n\n*3\n\n“Intangible assets acquired through business combinations,” which were included within “Other” in the fiscal year ended March 31, 2025, have increased in materiality and have been reclassified and presented separately, starting from the fiscal year ended March 31, 2026. As a result of this change, certain reclassifications have been made, the primary ones being as follows: “Intangible assets acquired through business combinations,” which were included within “Other” in the fiscal year ended March 31, 2025, have been reclassified; and “Intangible assets derived from EMI Music Publishing acquisition,” which were presented in the fiscal year ended March 31, 2025, have been reclassified and presented as “Intangible assets acquired through business combinations,” considering the nature of the adjustments.\n\n \n\nF-9\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n \n\n \n\nYen in millions\n\n \n\n \n\n \n\nFiscal year ended March 31, 2026\n\n \n\n \n\n \n\nBeginning\nbalance\n\n \n\n \n\nRecognized\nin profit or\nloss\n\n \n\n \n\nRecognized in\nother\ncomprehensive\nincome\n\n \n\n \n\nChanges\naccompanying\nbusiness\ncombination\n\n \n\n \n\nRecognized\ndirectly in\nequity\n\n \n\n \n\nOther\n*1\n\n \n\n \n\nImpact\nfrom loss of\ncontrol of\nthe\nFinancial\nServices\nbusiness\n*2\n\n \n\n \n\nEnding\nbalance\n\n \n\nDeferred tax assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOperating loss carryforwards for tax purposes\n\n \n\n \n\n81,391\n\n \n\n \n\n \n\n(11,007\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n3,410\n\n \n\n \n\n \n\n (47\n\n)\n\n \n\n \n\n73,747\n\n \n\nDefined benefit liabilities\n\n \n\n \n\n62,973\n\n \n\n \n\n \n\n11,676\n\n \n\n \n\n \n\n(13,014\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n492\n\n \n\n \n\n \n\n (11,032\n\n)\n\n \n\n \n\n51,095\n\n \n\nAmortization including content assets\n\n \n\n \n\n28,072\n\n \n\n \n\n \n\n8,168\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n10\n\n \n\n \n\n \n\n7,389\n\n \n\n \n\n \n\n(8,358\n\n)\n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n35,281\n\n \n\nLease liabilities\n\n \n\n \n\n135,274\n\n \n\n \n\n \n\n26,059\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n5,428\n\n \n\n \n\n \n\n (16,510\n\n)\n\n \n\n \n\n150,251\n\n \n\nWarranty reserves and accrued expenses\n\n \n\n \n\n174,772\n\n \n\n \n\n \n\n25,869\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n299\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n8,530\n\n \n\n \n\n \n\n \n(9,850\n\n)\n\n \n\n \n\n199,620\n\n \n\nInventories\n\n \n\n \n\n46,477\n\n \n\n \n\n \n\n(2,914\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n12\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n1,183\n\n \n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n44,758\n\n \n\nDepreciation\n\n \n\n \n\n38,894\n\n \n\n \n\n \n\n21,218\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n1,046\n\n \n\n \n\n \n\n \n(1,961\n\n)\n\n \n\n \n\n59,197\n\n \n\nEquity securities measured at FVPL\n\n \n\n \n\n12,866\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,514\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n8,650\n\n \n\n \n\n \n\n \n(2,028\n\n)\n\n \n\n \n\n26,002\n\n \n\nDebt securities measured at FVOCI\n\n \n\n \n\n576,263\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n \n(576,263\n\n)\n\n \n\n \n\n-\n\n \n\nTax credit carryforwards\n\n \n\n \n\n61,597\n\n \n\n \n\n \n\n(19,815\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n2,452\n\n \n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n44,234\n\n \n\nLoss allowances\n\n \n\n \n\n12,003\n\n \n\n \n\n \n\n401\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n124\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n915\n\n \n\n \n\n \n\n \n(426\n\n)\n\n \n\n \n\n13,017\n\n \n\nImpairment of investments\n\n \n\n \n\n54,208\n\n \n\n \n\n \n\n(37,490\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(6,166\n\n)\n\n \n\n \n\n \n(546\n\n)\n\n \n\n \n\n10,006\n\n \n\nDeferred revenue\n\n \n\n \n\n72,600\n\n \n\n \n\n \n\n(12,705\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(25\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n4,631\n\n \n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n64,501\n\n \n\nResearch and development expenditures\n\n \n\n \n\n100,944\n\n \n\n \n\n \n\n6,257\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n6,514\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n113,715\n\n \n\nOther\n\n \n\n \n\n395,274\n\n \n\n \n\n \n\n(28,048\n\n)\n\n \n\n \n\n331\n\n \n\n \n\n \n\n950\n\n \n\n \n\n \n\n712\n\n \n\n \n\n \n\n(5,915\n\n)\n\n \n\n \n\n \n(118,100\n\n)\n\n \n\n \n\n245,204\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal deferred tax assets\n\n \n\n \n\n1,853,608\n\n \n\n \n\n \n\n(12,331\n\n)\n\n \n\n \n\n(6,169\n\n)\n\n \n\n \n\n1,370\n\n \n\n \n\n \n\n8,101\n\n \n\n \n\n \n\n22,812\n\n \n\n \n\n \n\n (736,763\n\n)\n\n \n\n \n\n1,130,628\n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDeferred tax liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nInsurance contract liabilities\n\n \n\n \n\n(719,837\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n 719,837\n\n \n\n \n\n \n\n-\n\n \n\nRight-of-use\n\nassets\n\n \n\n \n\n(120,530\n\n)\n\n \n\n \n\n(18,944\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(4,016\n\n)\n\n \n\n \n\n 16,839\n\n \n\n \n\n \n\n(126,651\n\n)\n\nEquity securities measured at FVPL\n\n \n\n \n\n(100,151\n\n)\n\n \n\n \n\n10,141\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(6,446\n\n)\n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n(96,456\n\n)\n \n\nIntangible assets acquired through stock exchange\nofferings\n\n \n\n \n\n(23,949\n\n)\n\n \n\n \n\n(608\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n(24,557\n\n)\n\nIntangible assets acquired through business\ncombinations\n\n \n\n \n\n(182,287\n\n)\n\n \n\n \n\n30,412\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(14,936\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(13,367\n\n)\n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n(180,178\n\n)\n\nUndistributed earnings of foreign subsidiaries and\naffiliates\n\n \n\n \n\n(99,226\n\n)\n\n \n\n \n\n(7,161\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(7,878\n\n)\n\n \n\n \n\n \n-\n\n \n\n \n\n \n\n(114,265\n\n)\n\nInvestment in M3, Inc.\n\n \n\n \n\n(56,971\n\n)\n\n \n\n \n\n(5,328\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n(62,299\n\n)\n\nOther\n\n \n\n \n\n(166,601\n\n)\n\n \n\n \n\n(36,734\n\n)\n\n \n\n \n\n1,684\n\n \n\n \n\n \n\n(1,577\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n21,302\n\n \n\n \n\n \n\n 5,113\n\n \n\n \n\n \n\n(176,813\n\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal deferred tax liabilities\n\n \n\n \n\n(1,469,552\n\n)\n\n \n\n \n\n(28,222\n\n)\n\n \n\n \n\n1,684\n\n \n\n \n\n \n\n(16,513\n\n)\n\n \n\n \n\n-\n\n \n\n \n\n \n\n(10,405\n\n)\n\n \n\n \n\n 741,789\n\n \n\n \n\n \n\n(781,219\n\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\n*1\n\n“Other” includes exchange differences on translating foreign operations and others.\n\n*2\n\nThis includes the impact of the deconsolidation of the SFGI, which operates Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\nF-96\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nAs of March 31, 2025 and 2026, based on the assessment of recoverability of deferred tax assets, Sony continued not to recognize the deferred tax assets at some entities in Japan, Sony Mobile Communications AB in Sweden, Sony Europe B.V. in the United Kingdom, certain subsidiaries in Brazil, and certain subsidiaries in other tax jurisdictions.\n\nAs of March 31, 2025 and 2026, the deductible temporary differences, operating loss carryforwards and tax credit carryforwards for which no deferred tax asset is recognized are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\n Fiscal year ended March 31 \n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nDeductible temporary differences\n\n  \n \n131,442\n \n  \n \n247,701\n \n\nOperating loss carryforwards\n\n  \n \n1,465,002\n \n  \n \n1,484,949\n \n\nTax credit carryforwards\n\n  \n \n12,139\n \n  \n \n13,247\n \n\nAs of March 31, 2025 and 2026, the expected expiration period of the operating loss carryforwards for which no deferred tax asset is recognized are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\n Fiscal year ended March 31 \n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nWithin 5 years\n\n  \n \n362,529\n \n  \n \n449,326\n \n\nOver 5 years to 10 years\n\n  \n \n459,335\n \n  \n \n347,087\n \n\nOver 10 years to 15 years\n\n  \n \n31,198\n \n  \n \n37,971\n \n\nOver 15 years\n\n  \n \n16,575\n \n  \n \n28,794\n \n\nNo expiration period\n\n  \n \n595,365\n \n  \n \n621,771\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,465,002\n \n  \n \n1,484,949\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nAs of March 31, 2025 and 2026, the expected expiration period of the tax credit carryforwards for which no deferred tax asset is recognized was mostly within 5 years.\n\nDeferred tax liabilities are not recognized on the taxable temporary differences for undistributed earnings of certain foreign subsidiaries and corporate joint ventures which are not expected to be remitted in the foreseeable future. As of March 31, 2025 and 2026, such taxable temporary differences amounted to 1,117,684 million yen and 1,221,573 million yen, respectively. The tax basis of these undistributed earnings was approximately 17,883 million yen and 19,545 million yen, respectively. In addition, deferred tax liabilities are not recognized on the taxable temporary differences in subsidiaries, including a gain of 61,544 million yen on a subsidiary’s sale of stock arising from the issuance of common stock of Sony Music Entertainment (Japan) Inc. in a public offering to third parties in November 1991 and the remeasurement gain on 116,939 million yen for the\npre-owned\nequity interest in EMI Music Publishing acquired in November 2018. Sony does not anticipate any significant tax consequences on the possible future disposition of these investments based on its tax planning strategies.\n\nIn addition, the deductible temporary differences arising from the translation adjustments for the foreign operations for which deferred tax assets are not recognized as of March 31, 2025 and 2026 amounted to 173,711 million yen and 197,149 million yen, respectively. The taxable temporary differences arising from the translation adjustments for the foreign operations for which deferred tax liabilities are not recognized as of March 31, 2025 and 2026 amounted to 1,047,225 million yen and 1,499,571 million yen, respectively.\n\nSony applies the “International Tax Reform - Pillar Two Model Rules (Amendments to IAS 12)” that the IASB issued in May 2023. Sony does not recognize or disclose deferred tax assets and deferred tax liabilities related to taxes arising from the taxation associated with the Pillar Two Model Rules, applying the temporary exemption provisions stipulated by the Amendments to IAS 12.\n\nIn Japan, the Act for Partial Amendment of Income Tax Act, etc. (Act No. 3 of 2023) to implement the global minimum tax in accordance with the Pillar Two Model Rules, was enacted on March 28, 2023. This new tax reform statute applies to Sony from the fiscal year ended March 31, 2025. Sony estimated and recognized corporate income tax expense arising from this global minimum tax based on the financial information available at the reporting date. The impact on the consolidated financial statements was not material.\n\n \n\nF-\n9\n7\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n26.\n\nReconciliation of the differences between basic and diluted EPS\n\nReconciliation of the differences between basic and diluted EPS for the fiscal years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n \n\n2026\n\n \n\nNet income (loss) attributable to Sony Group Corporation’s stockholders for basic and diluted EPS computation\n\n  \n\n \n\n970,573\n\n \n\n  \n\n \n\n1,141,600\n\n \n\n \n \n\n(326,865\n\n)\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nContinuing operations\n\n  \n \n846,587\n \n  \n \n1,067,431\n \n \n \n1,030,893\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDiscontinued operations\n\n  \n \n123,986\n \n  \n \n74,169\n \n \n \n(1,357,758\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n  \n\nThousands of shares\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n \n\n2026\n\n \n\nWeighted-average shares outstanding for basic EPS computation\n\n  \n \n 6,156,210\n \n  \n \n6,049,652\n \n \n \n5,975,984\n \n\nEffect of dilutive securities:\n\n  \n\n  \n\n \n\nStock options\n\n  \n \n18,398\n \n  \n \n18,862\n \n \n \n25,890\n \n\nRestricted stock units\n\n  \n \n2,047\n \n  \n \n6,550\n \n \n \n11,316\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nWeighted-average shares for diluted EPS computation\n\n  \n \n6,176,655\n \n  \n \n6,075,064\n \n \n \n6,013,190\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n  \n\nYen\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n \n\n2026\n\n \n\nBasic EPS\n\n  \n\n \n\n157.66\n\n \n\n  \n\n \n\n188.71\n\n \n\n \n\n \n\n(54.70\n\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nContinuing operations\n\n  \n \n137.52\n \n  \n \n176.45\n \n \n \n172.51\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDiscontinued operations\n\n  \n \n20.14\n \n  \n \n12.26\n \n \n \n(227.21\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDiluted EPS\n\n  \n \n157.14\n \n  \n \n187.92\n \n \n \n(54.36\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nContinuing operations\n\n  \n \n137.06\n \n  \n \n175.71\n \n \n \n171.44\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDiscontinued operations\n\n  \n \n20.08\n \n  \n \n12.21\n \n \n \n(225.80\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNotes:\n\n \n\n \n1.\n\nPotential shares of common stock which were excluded from the computation of diluted EPS for the fiscal years ended March 31, 2024, 2025 and 2026 were 34,474 thousand shares, 14,422 thousand shares and 2,969 thousand shares, respectively, which consisted of stock options.\n\n \n\n \n2.\n\nAs of October 1, 2024, Sony Group Corporation conducted a\n\nfive-for-one\n\nstock split of its common stock. Basic and diluted EPS are calculated assuming that the stock split was implemented at the beginning of the fiscal year ended March 31, 2024.\n\n \n\n27.\n\nSupplemental cash flow information\n\n \n\n(1)\n\nClassification of cash flows of content assets\n\nSony classifies the cash flows from the additions, except for additions from purchases of businesses and other, and disposals of content assets as cash flows from operating activities in the consolidated statements of cash flows because the additions and disposals of content assets are derived from the principal revenue-producing activities of Sony.\n\n \n\nF-\n9\n8\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(2)\n\nInterest and dividends\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nInterest received\n\n  \n\n  \n\n  \n\nFinancial income\n\n \n\n \n\n36,295\n\n \n\n \n\n \n\n49,582\n\n \n\n \n\n \n\n55,647\n\n \n\nNet income (loss) from discontinued operations\n\n  \n \n  244,292\n \n  \n \n  260,725\n \n  \n \n138,878\n \n\nDividends received\n\n  \n\n  \n\n  \n\nFinancial income\n\n \n\n \n\n1,138\n\n \n\n \n\n \n\n1,390\n\n \n\n \n\n \n\n2,995\n\n \n\nNet income (loss) from discontinued operations\n\n  \n \n52,760\n \n  \n \n41,214\n \n  \n \n7,612\n \n\nInterest paid\n\n  \n\n  \n\n  \n\nFinancial expenses\n\n \n\n \n\n22,667\n\n \n\n \n\n \n\n21,829\n\n \n\n \n\n \n\n16,541\n\n \n\nNet income (loss) from discontinued operations\n\n  \n \n74,857\n \n  \n \n91,431\n \n  \n \n52,448\n \n\nThe above are items presented in the consolidated statements of income, which include cash flows for interest and dividends.\n\nSony classifies the cash flows from interest and dividends of the above as cash flows from operating activities in the consolidated statements of cash flows.\n\n \n\n(3)\n\nNon-cash\ninvesting and financing activities\n\nNon-cash\ninvesting and financing activities included an increase in ROU assets as a result of entering into lease contracts during the fiscal years ended March 31, 2024, 2025 and 2026. In addition,\nnon-cash\ninvesting and financing activities included an increase in ROU assets and dividends in kind as a result of the execution of the Partial\nSpin-off\nof the Financial Services business during the fiscal year ended March 31, 2026. Refer to “(4) Reconciliation of liabilities arising from financing activities” below for more details on the increase in ROU assets and refer to Note 20(5) for more details on the dividends in kind, respectively.\n\n \n\n(4)\n\nReconciliation of liabilities arising from financing activities\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nShort-term\nborrowings\n*1\n\n \n  \n\nLong-term\n\ndebt\n*1,2\n\n \n  \n\nLease\nliabilities\n*2,3\n\n \n\nBalance as of April 1, 2023\n\n  \n\n \n\n   92,646\n\n \n\n  \n\n \n\n   790,080\n\n \n\n  \n \n\n   532,247\n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nNet cash flows from financing activities\n\n  \n \n(18,370\n) \n  \n \n188,260\n \n  \n \n(91,234\n)\n\nAcquisitions through business combinations\n\n  \n \n796\n \n  \n \n-\n \n  \n \n853\n \n\nNon-cash\nitems:\n\n  \n\n  \n\n  \n\nObtaining assets by entering into lease contracts\n\n  \n \n-\n \n  \n \n-\n \n  \n \n101,039\n \n\nTranslation adjustment\n\n  \n \n12,097\n \n  \n \n36,946\n \n  \n \n39,222\n \n\nOther\n\n  \n \n1,133\n \n  \n \n(1,000\n)\n  \n \n(10,400\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal changes\n\n  \n \n(4,344\n) \n  \n \n224,206\n \n  \n \n39,480\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nBalance as of March 31, 202\n4\n\n  \n\n \n\n88,302\n\n \n\n  \n\n \n\n1,014,286\n\n \n\n  \n \n\n571,727\n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet cash flows from financing activities\n\n  \n \n(28,585\n) \n  \n \n57,325\n \n  \n \n(99,112\n)\n \n\nAcquisitions through business combinations\n\n  \n \n-\n \n  \n \n-\n\n  \n \n32,801\n \n\nNon-cash\nitems:\n\n  \n\n  \n\n  \n\nObtaining assets by entering into lease contracts\n\n  \n \n-\n \n  \n \n-\n \n  \n \n115,087\n \n\nTranslation adjustment\n\n  \n \n(1,040\n) \n  \n \n(3,664\n)\n  \n \n(5,744\n)\n\nOther\n\n  \n \n(8,036\n) \n  \n \n19,266\n \n  \n \n(15,289\n)\n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nTotal changes\n\n  \n\n \n\n(37,661\n\n) \n\n  \n\n \n\n72,927\n\n \n\n  \n\n \n\n27,743\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n\n \n\n50,641\n\n \n\n  \n\n \n\n1,087,213\n\n \n\n  \n\n \n\n599,470\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nNet cash flows from financing activities\n\n  \n\n \n\n(829\n\n)\n \n \n\n  \n\n \n\n(106,588\n\n)\n \n\n  \n\n \n\n(91,817\n\n)\n\nAcquisitions through business combinations\n\n  \n\n \n\n-\n\n \n\n  \n\n \n\n-\n\n \n\n  \n\n \n\n33\n\n \n\nNon-cash\nitems:\n\n  \n\n  \n\n  \n\nObtaining assets by entering into lease contracts\n\n  \n\n \n\n-\n\n \n\n  \n\n \n\n-\n\n \n\n  \n\n \n\n99,188\n\n \n\nTranslation adjustment\n\n  \n\n \n\n1,591\n\n \n\n  \n\n \n\n20,154\n\n \n\n  \n\n \n\n27,399\n\n \n\nOther\n*3\n\n  \n\n \n\n(220\n\n) \n\n  \n\n \n\n12\n\n \n\n  \n\n \n\n82,874\n\n \n\nImpact from loss of control of the Financial Services business\n*4\n\n  \n\n \n\n-\n\n \n\n  \n\n \n\n(9,988\n\n)\n \n\n  \n\n \n\n(89,464\n\n)\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nTotal changes\n\n  \n\n \n\n542\n\n \n\n  \n\n \n\n(96,410\n\n)\n\n  \n\n \n\n28,213\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n\n \n\n51,183\n\n \n\n  \n\n \n\n990,803\n\n \n\n  \n\n \n\n627,683\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nF-\n9\n\n9\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n*1\n\nThe amount of short-term borrowings and long-term debt associated with the insurance business and banking business operations, which are classified as cash flows from operating activities in the consolidated statements of cash flows, is excluded from the amount above.\n\n \n\n \n\n*2\n\nAs described in Note 2 (5), “Lease liabilities,” which were included within the “Current portion of long-term debt” and “Long-term debt,” are presented as part of a separate caption in the consolidated statements of financial position as of March 31, 2026. In connection with this change, the amounts related to lease liabilities have also been reclassified in the table above.\n\n \n\n \n\n*3\n\nThe amount includes 103,165 million yen of lease liabilities arising from lease agreements with the Financial Services business that were previously eliminated as intercompany transactions. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, these leases became external transactions and are therefore recognized in the\nconsolidated statements of financial position. \n\n \n\n \n\n*4\n\nThis is the amount as of the date of deconsolidation of SFGI, which operates the Financial Services business, resulting from the execution of the Partial\nSpin-off\nof the Financial Services business.\n\n \n\n(5)\n\nComponents of cash and cash equivalents\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCash and demand deposits\n\n  \n \n1,535,476\n \n  \n \n1,885,112\n \n  \n \n1,127,113\n \n\nTime deposits with original maturities of three months or less\n\n  \n \n63,169\n \n  \n \n126,375\n \n  \n \n570,153\n \n\nMoney market funds\n\n  \n \n219,559\n \n  \n \n709,460\n \n  \n \n511,613\n \n\nCall loans\n\n  \n \n88,909\n \n  \n \n260,009\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,907,113\n \n  \n \n2,980,956\n \n  \n \n2,208,879\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNotes:\n\n \n\n \n\n1.\n\nCash and demand deposits, time deposits with original maturities of three months or less and call loans are classified as financial assets required to be measured at amortized cost, whose carrying amounts approximate their fair values mainly due to their short-term nature. Money market funds are short-term and highly liquid investments with insignificant risk of changes in value. Money market funds are classified as financial assets required to be measured at fair value through profit or loss and classified within Level 1 of the fair value hierarchy.\n\n \n\n2.\n\nAs a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, the balance as of March 31, 2026 does not include cash and cash equivalents related to the Financial Services business.\n\n \n\n(6)\n\nCash flows from discontinued operations\n\nAs a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. In the consolidated statements of cash flows, the decrease resulting from deconsolidation in cash and cash equivalent previously recorded in the Financial Services business at the time of execution, amounting to\n1,170,068 million yen, is included in net cash used in investing activities from discontinued operations.\n\n \n\n(7)\n\nAcquisition of a group of assets that does not constitute a business\n\nDuring the fiscal year ended March 31, 2024, Sony newly obtained an interest in a company which owns certain music assets in the Music segment for consideration of 90,968 million yen, which is reflected in cash flows from investing activities as “Payments for purchases of businesses and other.” This transaction is accounted for as an acquisition of a group of assets that does not constitute a business.\n\nAs a result of the transaction, Sony consolidated the company and recognized 182,689 million yen of content assets (music catalogs) as well as 90,968 million yen of noncontrolling interests.\n\nDuring the fiscal year ended March 31, 2025, Sony established a new joint venture in the Music segment with a third party partner, which acquired interests in companies that own certain music and other assets (the “target companies”) as well as music assets directly from other rights holders. Sony consolidated the joint venture through Sony’s majority interest and reflected the consideration of 133,064 million yen for the acquisition of the interests in the target companies in cash flows from investing activities as “Payments for purchases of businesses and other.” Sony primarily recognized 116,289 million yen of content assets (music catalogs) and 11,501 million yen of other intangible assets from the acquisition of the interests in the target companies. The acquisition of the interests in the target companies is accounted for as an acquisition of a group of assets that does not constitute a business. The consideration for the content assets (music catalogs) directly acquired from other rights holders was 84,382 million yen, which was recorded in cash flows from operating activities as “Increase in content assets.”\n\n \n\nF-\n\n100\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n28.\n\nStructured entities\n\nSony has, from time to time, entered into various arrangements with structured entities. As a result of the execution of the Partial\nSpin-off\nof the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, the descriptions of the structured entities related to the Financial Services business are presented only as of March 31, 2025.\n\n \n\n(1)\n\nConsolidated structured entities\n\nSony consolidates investment funds as structured entities in the Financial Services business. The investment funds are designed so that voting or similar rights are not the dominant factor in deciding who controls these entities, but it is determined that Sony has control over these structured entities. Sony has not provided and does not intend to provide any significant financial or other support to any of the consolidated structured entities without contractual obligations to the investment funds. The assets and liabilities of structured entities that are consolidated in the Financial Services business are limited in their intended use by contractual arrangements. As of March 31, 2025, the total assets of these structured entities are 4,439,856 million yen.\n\nSony also consolidates several structured entities in the Music and Pictures segment. Sony has not provided and does not intend to provide any significant financial or other support to these structured entities without contractual obligation.\n\n \n\n(2)\n\nUnconsolidated structured entities\n\nIn the Financial Services business, Sony enters into securitization transactions for certain housing loans, involving unconsolidated structured entities. Sony\n \n\nderecognizes a financial asset when the contractual right to receive the cash flows from the financial asset is transferred, or when Sony retains the contractual right to receive the cash flows from the financial asset, but assumes a contractual obligation to pay the cash flows without reinvestment or material delay to other recipients in an arrangement, and substantially all the risks and rewards of ownership of the financial asset are transferred to another entity. Since the above securitization transactions do not meet the requirements for derecognition of financial assets, such transferred assets are not derecognized. Sony recorded\n150,953\n million yen of transferred assets that do not meet the requirement for derecognition of financial assets included in investments and advances in the Financial Services business as of March 31, 2025. As of March 31, 2025, the liabilities recorded from these securitization transactions were\n152,046\n million yen, which are included in the current portion of long-term debt and long-term debt. The liabilities will be settled when the payment for the transferred assets is executed and until this time, Sony is unable to utilize the transferred assets. The transferee of the transferred assets has recourse only to the transferred asset, and as of March 31, 2025, the fair value of the transferred assets is\n148,305\n million yen, and the associated liabilities is\n147,673\n million yen.\n\nIn addition to the above, in the Financial Services business, Sony makes investments in structured entities. Sony’s investments in such structured entities include securitized products, foreign corporate bonds and other investments. The following tables present the carrying amount of the investments of unconsolidated structured entities, the presentation in the consolidated statements of financial position, and the maximum exposure to loss associated with these investments as of March 31, 2025. Maximum exposure to loss does not reflect Sony’s estimate of the actual losses that could result from adverse changes, nor does it reflect the economic hedges Sony enters into to reduce its exposure. The risks associated with structured entities in which Sony is involved are limited to the amount recorded in the consolidated statements of financial position and the amount of commitments.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nMarch 31, 2025\n\n \n\n \n  \n\nPresentation in the consolidated statements of financial position\n\n \n  \n\nMaximum exposure\nto loss\n\n \n\n \n  \n\nInvestments and\nadvances in the\nFinancial Services\nsegment\n\n(Current assets)\n\n \n  \n\nInvestments and\nadvances in the\nFinancial Services\nsegment\n\n(Non-current assets)\n\n \n  \n\nOther financial\nassets\n\n(Current assets)\n\n \n\nSecuritized products\n\n  \n \n-\n \n  \n \n547,861\n \n  \n \n-\n \n  \n \n547,861\n \n\nForeign corporate bonds\n*1\n\n  \n \n22,071\n \n  \n \n219,935\n \n  \n \n-\n \n  \n \n242,006\n \n\nOther investments\n*2\n\n  \n \n-\n \n  \n \n590,721\n \n  \n \n21,429\n \n  \n \n634,216\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n22,071\n \n  \n \n1,358,517\n \n  \n \n21,429\n \n  \n \n1,424,083\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n*1 Foreign corporate bonds primarily include repackaged bonds.\n\n*2 Other investments primarily include investment funds.\n\n \n\nF-10\n1\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n29.\n\nSubsidiaries\n\nThe following table sets forth the major consolidated subsidiaries owned, directly or indirectly, by Sony Group Corporation.\n\n \n\nName of company\n\n  \n\nCountry of\n\nincorporation\n\n/residence\n\n  \n\n(As of March 31, 2026)\n\nPercentage owned\n\nSony Interactive Entertainment Inc.\n  \nJapan\n  \n100.0\n\nSony Music Entertainment (Japan) Inc.\n  \nJapan\n  \n100.0\n\nSony Corporation\n  \nJapan\n  \n100.0\n\nSony Global Manufacturing & Operations Corporation\n  \nJapan\n  \n100.0\n\nSony Network Communications Inc.\n  \nJapan\n  \n100.0\n\nSony Marketing Inc.\n  \nJapan\n  \n100.0\n\nSony Semiconductor Solutions Corporation\n  \nJapan\n  \n100.0\n\nSony Semiconductor Manufacturing Corporation\n  \nJapan\n  \n100.0\n\nSony Storage Media Corporation\n  \nJapan\n  \n100.0\n\nSony Corporation of America\n  \nU.S.A.\n  \n100.0\n\nSony Interactive Entertainment LLC\n  \nU.S.A.\n  \n100.0\n\nSony Music Entertainment\n  \nU.S.A.\n  \n100.0\n\nSony Music Publishing LLC\n  \nU.S.A.\n  \n100.0\n\nSony Pictures Entertainment Inc.\n  \nU.S.A.\n  \n100.0\n\nSony Electronics Inc.\n  \nU.S.A.\n  \n100.0\n\nSony Capital Corporation\n  \nU.S.A.\n  \n100.0\n\n \n\n \n\n \n\n \n\n \n\nSony Interactive Entertainment Europe Ltd.\n  \nU.K.\n  \n100.0\n\nSony Europe B.V.\n  \nU.K.\n  \n100.0\n\nSony Global Treasury Services Plc\n  \nU.K.\n  \n100.0\n\nSony Overseas Holding B.V.\n  \nNetherlands\n  \n100.0\n\nSony (China) Limited\n  \nChina\n  \n100.0\n\nSony EMCS (Malaysia) Sdn. Bhd.\n  \nMalaysia\n  \n100.0\n\nSony Electronics (Singapore) Pte. Ltd.\n  \nSingapore\n  \n100.0\n\n \n\n30.\n\nAcquisitions\n\n(1)\n\nAcquisition of an additional equity interest in Peanuts Holdings\n\nOn March 2, 2026 (Eastern Standard Time), SMEJ, a wholly-owned subsidiary of Sony within the Music segment, and Sony Pictures Entertainment Inc. (“SPE”), a wholly-owned subsidiary of Sony within the Pictures segment, indirectly acquired all of the approximately\n\n \n\n41\n%\n\nequity interest in Peanuts Holdings, which was indirectly held by WildBrain Ltd., a publicly listed Canadian company. The consideration for the acquisition of\n\n70,652\n million yen (\n617\n million Canadian dollars) was paid in cash.\n\nThe consideration is subject to customary working capital and other adjustments.\n\n \n\nAs a result of this acquisition, Sony expects to leverage SMEJ’s expertise in the character business cultivated to date, together with Sony Group’s global network, to further expand its business and other initiatives utilizing “PEANUTS” IP.\n\nPrior to the acquisition, Sony indirectly held approximately 39% equity interest in\n\n \n\nPeanuts Holdings\n\n \n\nthrough SMEJ and the interest was accounted for under the equity method of accounting. As a result of the acquisition, together with SMEJ’s previously existing approximately\n39\n% equity interest, SMEJ and SPE now indirectly own an\n80\n% equity interest in\n\n \n\nPeanuts Holdings, and Peanuts Holdings has become a consolidated subsidiary of Sony. In addition, because of remeasuring SMEJ’s previously existing equity interest at its fair value of\n\n \n\n57,501\n million yen as of the acquisition date,\n\nSony\n \n\nrecorded a remeasurement gain of\n34,662\n\n million yen in other operating income, net for the fiscal year ended March 31, 2026. The fair value of the previously held interest was calculated by adjusting the purchase price for factors such as projected future cash flows. Since significant inputs used in such adjustments are unobservable, the fair value measurement is classified as Level 3.\n\nAs a result of the acquisition, Sony consolidated DHX Entertainment (USA) Inc, which is the parent company of Peanuts Holdings, and its subsidiaries, using the acquisition method of accounting and recorded the fair value of the identifiable assets acquired, liabilities assumed and residual goodwill. Goodwill represents expected future growth from new revenue streams and synergies with Sony’s existing businesses and is not deductible for tax purposes. The following table summarizes the fair values assigned to the assets and liabilities that were recorded in the Music segment. The purchase price allocation as of the\n\n \n\nF-10\n2\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nacquisition date is preliminary\n\n as of March 31, 2026, and is subject to change.\n\nThe primary areas of the purchase allocation that are not yet finalized are related to goodwill, other intangible assets, and deferred tax liabilities.\n\n \n\n  \n\n  \n\n Yen in millions  \n\n \n\n \n\n Cash and cash equivalents\n\n  \n\n \n\n2,723 \n\n \n\n Trade and other receivables, and contract assets\n\n  \n\n \n\n7,113 \n\n \n\n Goodwill\n\n  \n\n \n\n44,564 \n\n \n\n Other intangible assets*\n\n  \n\n \n\n115,799 \n\n \n\n Other financial assets\n(non-current)\n\n  \n\n \n\n3,785 \n\n \n\n Other\n\n  \n\n \n\n115 \n\n \n\n Total assets\n\n  \n\n \n\n174,099 \n\n \n\n Trade and other payables\n\n  \n\n \n\n4,363 \n\n \n\n Income taxes payables\n\n  \n\n \n\n1,253 \n\n \n\n Contract liabilities\n\n  \n\n \n\n1,797 \n\n \n\n Deferred tax liabilities\n\n  \n\n \n\n12,591 \n\n \n\n Other financial liabilities\n(non-current)\n\n  \n\n \n\n2,239 \n\n \n\n Other\n\n  \n\n \n\n539 \n\n \n\n Total liabilities\n\n  \n\n \n\n22,782 \n\n \n\n Noncontrolling interests\n\n  \n\n \n\n23,164 \n\n \n\n*As a result of the acquisition, Sony recognized trademarks related to the “PEANUTS” IP as intangible assets amounting to 115,799 million yen. Sony determined that there is no foreseeable limit to the period over which these trademarks are expected to generate net cash inflows for Sony, and therefore recognized it as intangible assets with indefinite useful lives.\n\nThe cash consideration paid in this transaction, net of cash and cash equivalents included in above table, is included in cash flows from investing activities as Payments for purchases of businesses and other.\n\nThe post-acquisition revenues and net income included in Sony’s consolidated statements of income, as well as the related pro forma information, have not been presented as the effect of the acquisition is immaterial.\n\n \n\n(2)\n\nOther acquisitions of entities and businesses\n\nDuring the fiscal year ended March 31, 2024, Sony completed certain acquisitions for a total consideration of\n111,669\n million yen which was paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded\n70,791\n million yen of goodwill and\n69,294\n million yen of intangible assets.\n\nDuring the fiscal year ended March 31, 2025, Sony completed certain acquisitions for a total consideration of 74,009 million yen which was paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded 44,424 million yen of goodwill and 44,652 million yen of intangible assets.\n\nDuring the fiscal year ended March 31, 2026, Sony completed acquisitions\nother\n\nthan those\n\ndescribed in (1) above\nfor a total consideration of\n57,421 million yen which was paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded 43,494 million yen of goodwill and 51,065\n\n \nmillion yen of intangible assets.\n\nNo significant purchase price was allocated to\nin-process\nresearch and development and all of the acquired entities and businesses described above have been consolidated into Sony’s results of operations since their respective acquisition dates. Other information including pro forma results of operations has not been presented because the effects of other acquisitions, individually and in aggregate, were not material.\n\nIn addition, the effects of acquisitions of a group of assets that does not constitute a business are not included in this Note 30. For such effects, refer to Note 27 (7).\n\n \n\nF-10\n\n3\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n31.\n\nRelated party transactions\n\n \n\n(1)\n\nAccount balances and transactions with associates and joint ventures accounted for under the equity method\n\nPrimary account balances and transactions with associates and joint ventures accounted for under the equity method are as follows:\n\n \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nMarch 31\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nTrade and other accounts receivable\n\n  \n\n  \n\nAssociates\n\n  \n \n20,990\n \n  \n \n9,006\n \n\nJoint ventures\n\n  \n \n3,854\n \n  \n \n6,407\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n24,844\n \n  \n \n15,413\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nOther current assets\n  \n\n  \n\nAssociates\n\n  \n \n8,192\n \n  \n \n8,364\n \n\nJoint ventures\n\n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n8,192\n \n  \n \n8,364\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nAccounts payable, trade\n  \n\n  \n\nAssociates\n\n  \n \n1,102\n \n  \n \n1,092\n \n\nJoint ventures\n\n  \n \n55\n \n  \n \n36\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n1,157\n \n  \n \n1,128\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nShort-term borrowings\n  \n\n  \n\nAssociates\n\n  \n \n5,401\n \n  \n \n6,401\n \n\nJoint ventures\n\n  \n \n17,641\n \n  \n \n20,675\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n23,042\n \n  \n \n27,076\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nLease liabilities and other\n  \n\n  \n\nAssociates*\n\n  \n \n79,987\n \n  \n \n183,836\n \n\nJoint ventures\n\n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n79,987\n \n  \n \n183,836\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n* Refer to Note 10.\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nSales\n  \n\n  \n\n  \n\nAssociates\n\n  \n \n14,215\n \n  \n \n14,254\n \n  \n \n10,269\n \n\nJoint ventures\n\n  \n \n34,199\n \n  \n \n34,415\n \n  \n \n31,239\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n48,414\n \n  \n \n48,669\n \n  \n \n41,508\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nPurchases\n  \n\n  \n\n  \n\nAssociates\n\n  \n \n6,385\n \n  \n \n5,171\n \n  \n \n6,573\n \n\nJoint ventures\n\n  \n \n723\n \n  \n \n1,131\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n7,108\n \n  \n \n6,302\n \n  \n \n6,573\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nLease payments and other\n  \n\n  \n\n  \n\nAssociates\n\n  \n \n15,467\n \n  \n \n16,931\n \n  \n \n22,985\n \n\nJoint ventures\n\n  \n \n-\n \n  \n \n-\n \n  \n \n-\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n15,467\n \n  \n \n16,931\n \n  \n \n22,985\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSony has issued guarantees that contingently require payments to guaranteed parties if certain specified events or conditions occur. The maximum potential amount of future payments under these guarantees to joint ventures as of March 31, 2025 and 2026, amounted to 3,856 million yen and 3,775 million yen, respectively. In addition, Sony has agreements with shareholders of joint ventures to make cash investments in the joint ventures if certain specified events or conditions occur.\n\n \n\nF-10\n4\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n(2)\n\nCompensation for key management personnel\n\nCompensation for key management personnel for the fiscal years ended March 31, 2024, 2025 and 2026 is presented as follows:\n\n \n\n \n  \n\nYen in millions\n\n \n\n \n  \n\nFiscal year ended March 31\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nShort-term employee benefits\n\n  \n \n1,660\n \n  \n \n1,657\n \n  \n \n1,908\n \n\nStock-based compensation\n\n  \n \n2,917\n \n  \n \n4,431\n \n  \n \n4,254\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n4,577\n \n  \n \n6,088\n \n  \n \n6,162\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCompensation for key management personnel is the remuneration for Directors (including outside Directors) and Corporate Executive Officers of Sony Group Corporation.\n\n \n\n32.\n\nPurchase commitments, contingent liabilities and other\n\n \n\n(1)\n\nLoan commitments\n\nSubsidiaries in the Financial Services business have lines of credit in accordance with loan agreements with their customers. As of March 31, 2025, the total unused portion of the lines of credit extended under these contracts was\n27,564 \nmillion yen. As a result of the execution of the Partial Spin-off of the Financial Services business, SFGI, which operates the Financial Services business, has been excluded from consolidation. Therefore, loan commitments are presented only as of March 31, 2025.\n\n \n\n(2)\n\nPurchase commitments\n\nPurchase commitments for property, plant and equipment and intangible assets (excluding content assets) as of March 31, 2025 and 2026 amounted to 205,881 million yen and 84,969 million yen, respectively.\n\nIn addition to the above, Sony has purchase commitments for goods and services. There are no purchase commitments that are individually material to Sony, except for the following.\n\nPurchase commitments in the G&NS segment as of March 31, 2025 and 2026 amounted to 43,202 million yen and 33,691 million yen, respectively. The major components of these are long-term contracts for the development, distribution and publishing of game software. These contracts cover various periods mainly within four years and three years from the end of each period, respectively.\n\nPurchase commitments in the Music segment as of March 31, 2025 and 2026 amounted to 283,211 million yen and 342,183 million yen, respectively. The major components of these are contracts with recording artists, songwriters and production and sales companies of music software and videos for the future production, distribution and/or licensing of music products. These contracts cover various periods mainly within four years from the end of each period.\n\nPurchase commitments in the Pictures segment as of March 31, 2025 and 2026, amounted to 197,999 million yen and 184,667 million yen, respectively. The major components of these are agreements with creative talent for the development and production of motion pictures and television programming as well as agreements with third parties to acquire completed motion pictures, or certain rights therein, and to acquire the rights to broadcast certain live action sporting events. These\n\nagreements cover various periods mainly within four years and\n\nthree years from the end of each\n \n\nperiod, respectively.\n\nSony has entered\n\n into purchase contracts for materials. As of March 31, 2025 and 2026, Sony has committed to make payments of 152,356 million yen and 78,058 million yen, respectively, under such contracts.\n\nSony has entered into long-term contracts for the use of certain IT services. As of March 31, 2025 and 2026, Sony has committed to make payments of 251,478 million yen and 217,792 million yen, respectively, under such contracts.\n\n \n\n(3)\n\nLitigation\n\nSony Group Corporation and certain of its subsidiaries are defendants or otherwise involved in pending legal and regulatory proceedings. However, based upon the information currently available, Sony believes that the outcome from such legal and regulatory proceedings would not have a material impact on Sony’s results of operations and financial position.\n\n \n\n(4)\n\nGuarantees\n\nSony has issued guarantees that contingently require payments to guaranteed parties if certain specified events or conditions occur. The maximum potential amount of future payments under these guarantees as of March 31, 2025 and 2026 amounted to 4,161 million yen and 4,073 million yen, respectively.\n\n \n\nF-10\n\n5\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\n33.\n\nDiscontinued operations\n\nAt a meeting of the Board held on May 14, 2025, Sony Group Corporation resolved to submit a resolution for the execution of the Partial Spin-off of the Financial Services business, effective October 1, 2025, to the Board in early September 2025. Afterwards, at a meeting of the Board held on September 3, 2025, Sony Group Corporation resolved to execute the Partial Spin-off of the Financial Services business effective October 1, 2025. Upon execution of the Partial Spin-off of the Financial Services business, Sony Group Corporation distributed dividends in kind to shareholders appearing in Sony Group Corporation’s register of shareholders as of the record date, September 30, 2025, at the rate of one SFGI share to one share of common stock of Sony Group Corporation held by each shareholder, effective October 1, 2025. As a result, Sony Group Corporation held\n16.40%\nof SFGI shares as of October 1, 2025. \n\nIn connection with the resolution for the plan regarding the execution of the Partial\nSpin-off\nof the Financial Services business on May 14, 2025, Sony Group Corporation determined that the distribution of SFGI shares was highly probable and the Financial Services business was classified as a discontinued operation, in accordance with IFRS 5\n“Non-current\nAssets Held for Sale and Discontinued Operations.” As a result, in the consolidated statements of income, consolidated statements of comprehensive income, and consolidated statements of cash flows; revenue, expenses, other comprehensive income and cash flows of the Financial Services business, among other items, are separated from continuing operations, comprised of Sony’s businesses excluding the Financial Services business, and presented as net income (loss) from discontinued operations, other comprehensive income from discontinued operations, and net cash from discontinued operations, respectively. Additionally, in the consolidated statements of financial position, assets and liabilities of the Financial Services business were classified as a disposal group held for distribution to owners. Accumulated other comprehensive income directly related to the disposal group was classified as held for distribution to owners.\n\nThen, as a result of the execution of the Partial\nSpin-off\neffective October 1, 2025, SFGI, which was a wholly-owned subsidiary of Sony Group Corporation, was deconsolidated as of October 1, 2025. After considering factors such as Sony Group Corporation’s ownership interest in SFGI and the composition of SFGI’s board of directors, Sony Group Corporation concluded that it is able to exercise significant influence over SFGI. Accordingly, SFGI is accounted for as an affiliate using the equity method.\n\nFurther, as a result of the execution of the Partial\nSpin-off\nof the Financial Services business, 1,377,795 million yen of accumulated other comprehensive income directly related to the disposal group classified as held for distribution to owners at the time of the execution was transferred to net income (loss) from discontinued operations as a loss in the consolidated statements of income. Of this accumulated other comprehensive income, loss of 1,640,079 million yen relates to changes in the fair value of debt instruments measured at fair value through other comprehensive income held in the Financial Services business, and income of 263,298\n\n \nmillion yen relates to insurance finance income (expenses). The latter mainly comprises changes in the carrying amount of groups of insurance contracts not measured under the PAA that are arising from the impact of the changes in the time value of money and financial risks. The discount rates used to measure the estimates of the present value of future cash flows, which represent significant assumptions used in measuring the portion of accumulated other comprehensive income related to insurance finance income (expenses), are derived by adjusting a\nn\nobservable risk-free yield curve based on government bond yields using an illiquidity premium by setting up a reference portfolio of Sony’s assets. Regarding extrapolation for the periods in which observable market data is not available, a method using an ultimate forward rate is applied.\n\nIn addition, upon applying the equity method to SFGI on October 1, 2025, the fair value of SFGI shares on that date was recorded as its initial investment cost. At the time of the execution of the Partial\nSpin-off\nof the Financial Services business, since Sony’s equity interest in the net fair value of SFGI’s identifiable assets and liabilities exceeded the cost of the initial recognition of the investment, 188,888 million yen of the excess was recognized as the share of profit of investments accounted for using the equity method in connection with the initial investment cost. On the other hand, since the fair value of SFGI shares as of October 1, 2025 was lower than the equity method carrying amount, which is the initial investment cost plus the share of profit of investments accounted for using the equity method, 188,888 million yen of an impairment loss of the same amount as the aforementioned excess amount has been recorded as the share of loss of investments accounted for using the equity method.\n\n \n\nF-106\n\n[Table of Contents](#toc)\n\nSONY GROUP CORPORATION AND CONSOLIDATED SUBSIDIARIES\n\n \n\nResults of discontinued operations\n\n \n\n$\n\n                        \n\n$\n\n                        \n\n$\n\n                        \n\n \n\n  \n\nYen in millions\n\n \n\n \n\n  \n\nFiscal year ended March 31\n\n \n\n \n\n  \n\n  2024  \n\n \n\n \n\n  2025  \n\n \n\n \n\n  2026  \n\n \n\n Financial services revenue\n\n  \n \n1,760,731\n \n \n \n922,147\n \n \n \n678,023\n \n\n Financial services expenses\n\n  \n \n1,606,370\n \n \n \n789,702\n \n \n \n640,811\n \n\n Reclassification of accumulated other comprehensive income related to the disposal group to net income (loss)\n\n  \n \n-\n \n \n \n-\n \n \n \n(1,377,795\n) \n\n Other income (expenses), net\n\n  \n \n19,215\n \n \n \n(1,917\n) \n \n \n(6,450\n)\n\nIncome (loss) before income taxes from discontinued operations\n\n  \n \n173,576\n \n \n \n130,528\n \n \n \n(1,347,033\n)\n\n Income taxes\n\n  \n \n49,063\n \n \n \n56,359\n \n \n \n10,725\n \n\nNet income (loss) from discontinued operations\n\n  \n \n124,513\n \n \n \n74,169\n \n \n \n(1,357,758\n)\n\nOther comprehensive income, net of tax, from discontinued operations\n\n  \n \n(141,679\n) \n \n \n(115,342\n) \n \n \n1,408,764\n \n\nItems that will not be reclassified to profit or loss\n\n  \n\n \n\n \n\nChanges in equity instruments measured at fair value through other comprehensive income\n\n  \n \n1,013\n \n \n \n(998\n) \n \n \n963\n \n\nRemeasurement of defined benefit pension plans\n\n  \n \n(1,169\n) \n \n \n(444\n) \n \n \n(106\n) \n\nItems that may be reclassified subsequently to profit or loss\n\n  \n\n \n\n \n\nChanges in debt instruments measured at fair value through other comprehensive income\n\n  \n \n(704,636\n) \n \n \n(681,515\n) \n \n \n1,346,457\n \n\nInsurance finance income (expenses)\n\n  \n \n563,396\n \n \n \n568,291\n \n \n \n60,684\n \n\nOthers\n\n  \n \n(283\n) \n \n \n(676\n) \n \n \n766\n \n\n Comprehensive income from discontinued operations\n\n  \n \n(17,166\n) \n \n \n(41,173\n) \n \n \n51,006\n \n\n \n\n34.\n\nSubsequent events\n\n(Establishment of a facility for the repurchase of shares of its own common stock)\n\nSony Group Corporation approved the establishment of the following facility for the repurchase of its own common stock pursuant to the Companies Act of Japan and Sony Group Corporation’s Articles of Incorporation at the meeting of the Board held on May 8, 2026.\n\n1. Total number of shares for repurchase: 230 million shares (maximum)\n\n2. Total purchase price for repurchase of shares: 500 billion yen (maximum)\n\n3. Period of repurchase: May 11, 2026 to May 10, 2027\n\n(Cancellation of shares of its own common stock)\n\nBased on a decision by Sony Group Corporation’s Representative Corporate Executive Officer delegated by the Board, and pursuant to the Companies Act of Japan, Sony Group Corporation cancelled shares of its own common stock held as treasury stock as follows.\n\n1.\nTotal number of cancelled shares: \n184,494,319 shares\n\n2. Cancellation date: May 29, 2026\n\n(Acquisition of a group of assets that does not constitute a business)\n\nIn May 2026, a consolidated subsidiary of Sony in the Music Segment entered into a definitive agreement to acquire 100% of the equity interests in a company that owns certain music assets and other assets. Sony will consolidate the company and the acquisition will be accounted for as an acquisition of a group of assets that does not constitute a business. The total cash consideration is approximately 1.6 billion U.S. dollars, subject to customary working capital and other adjustments. As a result of the transaction, Sony will recognize approximately 3.4 billion U.S. dollars of content assets (music catalogs), approximately 1.9 billion U.S. dollars of long-term debt and approximately 0.4 billion U.S. dollars of non-controlling interests by consolidating the company. This transaction is subject to certain closing conditions, including regulatory approvals.\n\n \n\nF-10\n\n7"}