Edgar Filing: SONY CORP

a51209600.htm

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

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

the Securities Exchange Act of 1934

For the month of October 2015

Commission File Number: 001-06439

SONY CORPORATION

(Translation of registrant's name into English)

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

(Address of principal executive offices)

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

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

Form 20-F X

Form 40-F __

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

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

SIGNATURE

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

	SONY CORPORATION
	(Registrant)


	By: /s/ Kenichiro Yoshida
	(Signature)
	Kenichiro Yoshida
	Executive Deputy President and
	Chief Financial Officer

Date: October 29, 2015

List of materials

Documents attached hereto:

i) Press release announcing Consolidated Financial Results for the Second Quarter Ended September 30, 2015

	1-7-1 Konan, Minato-ku
	Tokyo 108-0075 Japan
News & Information

No. 15-085E

3:00 P.M. JST, October 29, 2015

Consolidated Financial Results for the Second Quarter Ended September 30, 2015

Tokyo, October 29, 2015 -- Sony Corporation today announced its consolidated financial results for the second quarter ended September 30, 2015 (July 1, 2015 to September 30, 2015).

		(Billions of yen, millions of U.S. dollars, except per share amounts)
		Second Quarter ended September 30
		2014			2015	Change in yen			2015*
Sales and operating revenue	¥	1,901.5		¥	1,892.7	-0.5	%	$	15,773
Operating income (loss)		(85.6	)		88.0	-			733
Income (loss) before income taxes		(90.0	)		72.2	-			602
Net income (loss) attributable to Sony Corporation’s stockholders		(136.0	)		33.6	-			280
Net income (loss) attributable to Sony Corporation’s stockholders per share of common stock:
- Basic	¥	(124.32	)	¥	26.64	-		$	0.22
- Diluted		(124.32	)		26.10	-			0.22

*	U.S. dollar amounts have been translated from yen, for convenience only, at the rate of 120 yen = 1 U.S. dollar, the approximate Tokyo foreign exchange market rate as of September 30, 2015.

All amounts are presented on the basis of Generally Accepted Accounting Principles in the U.S. (“U.S. GAAP”).

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

The average foreign exchange rates during the quarters ended September 30, 2014 and 2015 are presented below.

	Second Quarter ended September 30
	2014		2015		Change
The average rate of yen
1 U.S. dollar	¥	103.9	¥	122.2	15.0	%	(yen depreciation)
1 Euro		137.8		135.9	1.4		(yen appreciation)

Consolidated Results for the Second Quarter Ended September 30, 2015

Sales and operating revenue (“Sales”) decreased 0.5% compared to the same quarter of the previous fiscal year (“year-on-year”) to 1,892.7 billion yen (15,773 million U.S. dollars). Sales were essentially flat year-on-year mainly due to a decrease in Financial Services segment revenue, reflecting a deterioration in investment performance in the separate account, and a decrease in Mobile Communications (“MC”) segment sales, reflecting a significant decrease in smartphone unit sales, substantially offset by the impact of foreign exchange rates and a significant increase in Game & Network Services (“G&NS”) segment sales, reflecting an increase in PlayStation®4 (“PS4”) software sales. On a constant currency basis, sales decreased 7% year-on-year. For further details about the impact of foreign exchange rate fluctuations on sales and operating income (loss), see Notes on page 10.

Operating income of 88.0 billion yen (733 million U.S. dollars) was recorded, compared to an operating loss of 85.6 billion yen in the same quarter of the previous fiscal year. This significant improvement was primarily due to the 176.0 billion yen impairment of goodwill recorded in the MC segment in the same quarter of the previous fiscal year. This improvement was partially offset by a significant deterioration in the operating results of the Pictures segment.

During the current quarter, restructuring charges, net, decreased 3.8 billion yen year-on-year to 5.6 billion yen (48 million U.S. dollars).

Equity in net income of affiliated companies, recorded within operating income (loss), increased 0.3 billion yen year-on-year to 0.9 billion yen (8 million U.S. dollars).

The net effect of other income and expenses was an expense of 15.8 billion yen (132 million U.S. dollars), a deterioration of 11.5 billion yen year-on-year mainly due to an increase in foreign exchange loss, net.

Income before income taxes of 72.2 billion yen (602 million U.S. dollars) was recorded, compared to a loss of 90.0 billion yen in the same quarter of the previous fiscal year.

Income taxes: During the current quarter, Sony recorded 23.9 billion yen (199 million U.S. dollars) of income tax expense, resulting in an effective tax rate of 33.1%. In the same quarter of the previous fiscal year, 30.1 billion yen of income tax expense was recorded despite the net loss before income taxes. This was primarily due to the nondeductible goodwill impairment recorded during the same quarter of the previous fiscal year.

Net income attributable to Sony Corporation’s stockholders, which deducts net income attributable to noncontrolling interests, of 33.6 billion yen (280 million U.S. dollars) was recorded, compared to a loss of 136.0 billion yen in the same quarter of the previous fiscal year.

Operating Performance Highlights by Business Segment

“Sales and operating revenue” in each business segment represents sales and operating revenue recorded before intersegment transactions are eliminated. “Operating income (loss)” in each business segment represents operating income (loss) reported before intersegment transactions are eliminated and excludes unallocated corporate expenses.

Mobile Communications (MC)

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014			2015			Change in yen			2015
Sales and operating revenue	¥	329.5		¥	279.2			-15.2	%	$	2,327
Operating loss		(170.6	)		(20.6	)		-			(172	)

Due to certain changes in Sony’s organizational structure, sales and operating revenue and operating income (loss) of the MC segment of the comparable prior period have been reclassified to conform to the current presentation. For details, please see Notes on page 10.

Sales decreased 15.2% year-on-year (a 17% decrease on a constant currency basis) to 279.2 billion yen (2,327 million U.S. dollars). This decrease was due to a significant decrease in smartphone unit sales resulting from a strategic decision not to pursue scale in order to improve profitability.

Operating loss decreased 150.0 billion yen year-on-year to 20.6 billion yen (172 million U.S. dollars). This significant decrease in the operating loss was primarily due to the above-mentioned 176.0 billion yen impairment charge of goodwill recorded in the same quarter of the previous fiscal year. The operating results were also primarily affected by the negative impact of the appreciation of the U.S. dollar, reflecting the high ratio of U.S. dollar-denominated costs, and an increase in restructuring charges. The negative impact of the above-mentioned decrease in smartphone unit sales was offset by an improvement in product mix reflecting a shift to high value-added models, as well as reductions in costs including marketing and research and development expenses. During the current quarter there was a 24.4 billion yen negative impact from foreign exchange rate fluctuations.

Game & Network Services (G&NS)

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014		2015		Change in yen			2015
Sales and operating revenue	¥	309.5	¥	360.7		+16.5	%	$	3,006
Operating income		21.8		23.9		+9.8			199

The G&NS segment includes the Hardware, Network, and Other categories. Hardware includes home and portable game consoles; Network includes network services relating to game, video and music content provided by Sony Network Entertainment International LLC; Other includes packaged software and peripheral devices.

Sales increased 16.5% year-on-year (a 10% increase on a constant currency basis) to 360.7 billion yen (3,006 million U.S. dollars). This significant increase was primarily due to an increase in PS4 software sales as well as the impact of foreign exchange rates, partially offset by a decrease in PlayStation®3 (“PS3”) software sales.

Operating income increased 2.1 billion yen year-on-year to 23.9 billion yen (199 million U.S. dollars). This increase was primarily due to the above-mentioned increase in PS4 software sales, partially offset by the negative impact of the appreciation of the U.S. dollar, reflecting the high ratio of U.S. dollar-denominated costs and the above-mentioned decrease in PS3 software sales. During the current quarter there was a 13.1 billion yen negative impact from foreign exchange rate fluctuations.

Imaging Products & Solutions (IP&S)

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014		2015		Change in yen			2015
Sales and operating revenue	¥	178.6	¥	186.0		+4.1	%	$	1,550
Operating income		20.1		25.9		+28.6			215

The IP&S segment includes the Digital Imaging Products and Professional Solutions categories. Digital Imaging Products includes compact digital cameras, interchangeable single-lens cameras and video cameras; Professional Solutions includes broadcast- and professional-use products.

Sales increased 4.1% year-on-year (a 3% decrease on a constant currency basis) to 186.0 billion yen (1,550 million U.S. dollars), primarily due to an improvement in product mix of digital cameras* reflecting a shift to high value-added models and the impact of foreign exchange rates, partially offset by a decrease in unit sales of digital cameras reflecting a contraction of the market.

Operating income increased 5.8 billion yen year-on-year to 25.9 billion yen (215 million U.S. dollars). This increase was mainly due to the improvement in digital camera product mix and cost reductions, partially offset by the impact of the above-mentioned decrease in unit sales of digital cameras. During the current quarter there was a 1.9 billion yen positive impact from foreign exchange rate fluctuations.

* Digital cameras includes compact digital cameras, interchangeable single-lens cameras and interchangeable lenses.

Home Entertainment & Sound (HE&S)

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014		2015		Change in yen			2015
Sales and operating revenue	¥	289.7	¥	289.1		-0.2	%	$	2,409
Operating income		9.1		15.8		+73.9			131

The HE&S segment includes the Televisions and Audio and Video categories. Televisions includes LCD televisions; Audio and Video includes Blu-ray DiscTM players and recorders, home audio, headphones and memory-based portable audio devices. Due to certain changes in Sony’s organizational structure, sales and operating revenue and operating income (loss) of the HE&S segment of the comparable prior period have been reclassified to conform to the current presentation. For details, please see Notes on page 10.

Sales decreased 0.2% year-on-year (a 7% decrease on a constant currency basis) to 289.1 billion yen (2,409 million U.S. dollars). Sales were essentially flat primarily due to a decrease in home audio and video unit sales reflecting a contraction of the market, offset by an improvement in product mix of LCD televisions reflecting a shift to high value-added models and the impact of foreign exchange rates.

Operating income increased 6.7 billion yen year-on-year to 15.8 billion yen (131 million U.S. dollars). This increase was primarily due to cost reductions and an improvement in product mix, partially offset by the negative impact of the appreciation of the U.S. dollar, reflecting the high ratio of U.S. dollar-denominated costs as well as the impact of the above-mentioned decrease in home audio and video unit sales. During the current quarter there was a 10.4 billion yen negative impact from foreign exchange rate fluctuations.

In Televisions, sales* increased 1.6% year-on-year to 203.0 billion yen (1,692 million U.S. dollars). This increase was primarily due to an improvement in product mix reflecting a shift to high value-added models and the impact of foreign exchange rates, partially offset by a decrease in LCD television unit sales resulting from a strategic decision not to pursue scale in order to improve profitability. Operating income** increased 4.8 billion yen year-on-year to 9.7 billion yen (81 million U.S. dollars). This increase was primarily due to cost reductions and an improvement in product mix, partially offset by the negative impact of the appreciation of the U.S. dollar, reflecting the high ratio of U.S. dollar-denominated costs, and the impact of the decrease in unit sales.

*	Sales for Televisions do not include operating revenue.

**	The operating income in Televisions excludes restructuring charges, which are included in the overall segment results and are not allocated to product categories.

Devices

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014		2015		Change in yen			2015
Sales and operating revenue	¥	240.4	¥	258.1		+7.4	%	$	2,151
Operating income		28.3		32.7		+15.4			272

The Devices segment includes the Semiconductors and Components categories. Semiconductors includes image sensors; Components includes batteries and recording media. Due to certain changes in Sony’s organizational structure, sales and operating revenue and operating income (loss) of the Devices segment of the comparable prior period have been reclassified to conform to the current presentation. For details, please see Notes on page 10.

Sales increased 7.4% year-on-year (a 5% decrease on a constant currency basis) to 258.1 billion yen (2,151 million U.S. dollars). This increase was primarily due to the impact of foreign exchange rates and an increase in demand for image sensors, partially offset by a decrease in battery business sales. Sales to external customers increased 17.3% year-on-year.

Operating income increased 4.4 billion yen year-on-year to 32.7 billion yen (272 million U.S. dollars). This increase was primarily due to the positive impact of foreign exchange rates and the above-mentioned impact of an increase in sales of image sensors, partially offset by an increase in depreciation and amortization, an increase in research and development expenses and a decrease in battery business sales. During the current quarter there was a 12.0 billion yen positive impact from foreign exchange rate fluctuations.

* * * * *

Total inventory of the five Electronics* segments above as of September 30, 2015 was 831.0 billion yen (6,925 million U.S. dollars), an increase of 7.8 billion yen, or 0.9% year-on-year. Inventory increased by 155.4 billion yen, or 23.0% compared with the level as of June 30, 2015.

* The term “Electronics” refers to the sum of the MC, G&NS, IP&S, HE&S and Devices segments.

In connection with the realignment made from the first quarter of the fiscal year ending March 31, 2016, total inventory of the five Electronics segments as of September 30, 2014 has been reclassified to conform to the presentation for the fiscal year ending March 31, 2016. For further details, please see Notes on page 10.

* * * * *

Pictures

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014			2015			Change in yen			2015
Sales and operating revenue	¥	182.2		¥	183.7			+0.9	%	$	1,531
Operating loss		(1.0	)		(22.5	)		-			(187	)

The Pictures segment is comprised of the Motion Pictures, Television Productions, and Media Networks categories. Motion Pictures includes the production, acquisition and distribution of motion pictures; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks.

The results presented in Pictures are a yen-translation of the results of Sony Pictures Entertainment Inc. (“SPE”), a U.S.-based operation that aggregates the results of its worldwide subsidiaries on a U.S. dollar basis. Management analyzes the results of SPE in U.S. dollars, so discussion of certain portions of its results is specified as being on “a U.S. dollar basis.”

Sales increased 0.9% year-on-year (a 14% decrease on a U.S. dollar basis) to 183.7 billion yen (1,531 million U.S. dollars). The decrease in sales on a U.S. dollar basis was primarily due to significantly lower sales for Motion Pictures reflecting lower home entertainment revenues, as the same quarter of the previous fiscal year benefitted from the home entertainment performances of The Amazing Spider-Man 2 and Heaven is for Real, as well as lower television licensing revenues.

Operating loss increased 21.4 billion yen year-on-year to 22.5 billion yen (187 million U.S. dollars). This deterioration in operating results was primarily due to the impact of the above-mentioned decrease in Motion Pictures sales as well as higher worldwide theatrical marketing expenses due to a greater number of significant theatrical releases in the current quarter as compared to the same quarter of the previous fiscal year.

Music

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014		2015		Change in yen			2015
Sales and operating revenue	¥	120.6	¥	138.7		+15.0	%	$	1,156
Operating income		12.2		14.6		+20.0			122

The Music segment is comprised of the Recorded Music, Music Publishing and Visual Media and Platform categories. Recorded Music includes the distribution of physical and digital recorded music and revenue derived from artists’ live performances; Music Publishing includes the management and licensing of the words and music of songs; Visual Media and Platform includes various service offerings for music and visual products and the production and distribution of animation titles.

The results presented in Music include the yen-translated results of Sony Music Entertainment (“SME”), a U.S.-based operation which aggregates the results of its worldwide subsidiaries on a U.S. dollar basis, the results of Sony Music Entertainment (Japan) Inc., a Japan-based music company which aggregates its results in yen, and the yen-translated consolidated results of Sony/ATV Music Publishing LLC (“Sony/ATV”), a 50% owned U.S.-based joint venture in the music publishing business which aggregates the results of its worldwide subsidiaries on a U.S. dollar basis.

Due to certain changes in Sony’s organizational structure, sales and operating revenue and operating income (loss) of the Music segment of the comparable prior period have been reclassified to conform to the current presentation. For details, please see Notes on page 10.

Sales increased 15.0% year-on-year (a 4% increase on a constant currency basis) to 138.7 billion yen (1,156 million U.S. dollars) primarily due to the impact of the depreciation of the yen against the U.S. dollar. The increase in sales on a constant currency basis was primarily due to an increase in Visual Media and Platform sales reflecting higher live entertainment venue revenue and higher sales of animation products. Best-selling titles included David Gilmour’s Rattle that Lock, Future’s DS2 and Maitre Gims’ Mon Coeur Avait Raison.

Operating income increased 2.4 billion yen year-on-year to 14.6 billion yen (122 million U.S. dollars). This increase was primarily due to an improvement in product mix, reflecting an increase in digital streaming revenues.

Financial Services

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014		2015		Change in yen			2015
Financial services revenue	¥	269.6	¥	210.7		-21.8	%	$	1,756
Operating income		47.7		41.2		-13.7			343

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

Financial services revenue decreased 21.8% year-on-year to 210.7 billion yen (1,756 million U.S. dollars) primarily due to a significant decrease in revenue at Sony Life. Revenue at Sony Life decreased 26.7% year-on-year to 177.7 billion yen (1,481 million U.S. dollars) due to a significant deterioration in investment performance in the separate account, partially offset by an increase in insurance premium revenue reflecting a steady increase in policy amount in force. The significant deterioration in investment performance was primarily due to a significant decline in the Japanese stock market during the current quarter, as compared with a rise in the same quarter of the previous fiscal year.

Operating income decreased 6.5 billion yen year-on-year to 41.2 billion yen (343 million U.S. dollars) mainly due to a decrease in operating income at Sony Life. Operating income at Sony Life decreased 11.0 billion yen year-on-year to 34.7 billion yen (289 million U.S. dollars). This decrease was primarily due to increases in the amortization of deferred insurance acquisition costs, pertaining to variable insurance, and the provision of policy reserves, pertaining to minimum guarantees for variable insurance, driven by the above-mentioned deterioration in investment performance in the separate account.

All Other

	(Billions of yen, millions of U.S. dollars)
	Second Quarter ended September 30
	2014			2015		Change in yen			2015
Sales and operating revenue	¥	86.5		¥	87.4		+1.0	%	$	728
Operating income (loss)		(19.8	)		0.5		-			5

All Other included costs related to the PC business in the same quarter of the previous fiscal year. Due to certain changes in Sony’s organizational structure, sales and operating revenue and operating income (loss) of All Other of the comparable prior period have been reclassified to conform to the current presentation. For details, please see Notes on page 10.

Sales increased 1.0% year-on-year to 87.4 billion yen (728 million U.S. dollars).

Operating income of 0.5 billion yen (5 million U.S. dollars) was recorded, compared to an operating loss of 19.8 billion yen in the same quarter of the previous fiscal year. This significant improvement was primarily due to a decrease in PC exit costs, including restructuring charges and after-sales service expenses, as well as the absence of sales company fixed costs charged to the PC business in the same quarter of the previous fiscal year which were allocated based on the prior year results.

Consolidated Results for the Six Months ended September 30, 2015

For Consolidated Statements of Income and Business Segment Information for the six months ended September 30, 2015 and 2014, please refer to pages F-3 and F-7 respectively.

Sales for the six months ended September 30, 2015 (“the current six months”) were 3,700.8 billion yen (30,840 million U.S. dollars), essentially flat year-on-year. This was primarily due to the significant decrease in sales in the MC segment, offset by the significant increase in sales in the G&NS and the Devices segments, and the impact of foreign exchange rates.

During the current six months, the average rates of the yen were 121.8 yen against the U.S. dollar and 135.0 yen against the euro, which were 15.4% lower and 2.9% higher, respectively, as compared with the same period in the previous fiscal year. On a constant currency basis, consolidated sales decreased 7%. For further detail about sales on a constant currency basis, see Notes on page 10.

In the MC segment, sales decreased primarily due to a significant decrease in smartphone unit sales resulting from a strategic decision not to pursue scale in order to improve profitability. In the G&NS segment, sales increased significantly primarily due to the contribution of PS4 software sales. In the IP&S segment, sales increased primarily due to an improvement in the product mix of digital cameras reflecting a shift to high value-added models. In the HE&S segment, sales decreased primarily due to a decrease in LCD televisions and home audio and video unit sales. In the Devices segment, sales increased significantly mainly due to an increase in sales of image sensors for mobile devices and the impact of foreign exchange rates. In the Pictures segment, sales decreased due to lower theatrical, television licensing and home entertainment revenues for Motion Pictures. In the Music segment, sales increased significantly primarily due to the favorable impact of the depreciation of the yen against the U.S. dollar and higher Visual Media and Platform sales. In the Financial Services segment, revenue decreased primarily due to a deterioration in investment performance in the separate account at Sony Life.

Operating income of 184.9 billion yen (1,541 million U.S. dollars) was recorded, compared to an operating loss of 15.8 billion yen in the same period of the previous fiscal year. This improvement was primarily due to the impairment of goodwill of 176.0 billion yen recorded in the MC segment in the same period of the previous fiscal year, as well as the improvement in the operating results of Devices, Music, G&NS, IP&S and HE&S segments, partially offset by a significant deterioration in the operating results of the Pictures segment.

Operating income during the current six months includes a 151 million U.S. dollar (18.1 billion yen) gain on the remeasurement to fair value of SME’s 51% equity interest in Orchard Media, Inc. (“The Orchard”), which had previously been accounted for under the equity method, as a result of SME increasing its ownership interest to 100%, recorded in the Music Segment, as well as a gain of 12.3 billion yen (101 million U.S. dollars) from the sale of a part of the logistics business, in connection with the formation of a logistics joint venture, recorded in Corporate and elimination. The operating loss in the same period of the previous fiscal year included a gain of 14.8 billion yen recognized on the sale of certain buildings and premises at the Gotenyama Technology Center in Japan, recorded in Corporate and elimination.

In the MC segment, operating loss decreased significantly year-on-year mainly due to the above-mentioned impairment charge recorded in this segment in the same period of the previous fiscal year. In the G&NS segment, operating income increased significantly year-on-year primarily due to the contribution of PS4 software sales. In the IP&S segment, operating income increased year-on-year primarily due to an improvement in digital camera product mix. In the HE&S segment, operating income increased year-on-year primarily due to cost reductions and an improvement in product mix reflecting a shift to high value-added models. In the Devices segment, operating income increased mainly due to the favorable impact of exchange rates and an increase in sales of image sensors. In the Pictures segment, operating results deteriorated significantly primarily due to the above-mentioned decrease in Motion Pictures sales. In the Music segment, operating income increased significantly primarily due to the above-mentioned gain recorded on the remeasurement to fair value of SME’s 51% equity interest in The Orchard. In the Financial Services segment, operating income was essentially flat year-on-year. This result was primarily due to increases in the amortization of deferred insurance acquisition costs, pertaining to variable insurance, and the provision of policy reserves, pertaining to minimum guarantees for variable insurance, driven by the deterioration in investment performance in the separate account, offset by an improvement in investment performance in the general account at Sony Life.

Restructuring charges, net, recorded as operating expenses, amounted to 15.7 billion yen (131 million U.S. dollars) for the current six months, compared to 24.7 billion yen for the same period of the previous fiscal year.

Equity in net income of affiliated companies, recorded within operating income, decreased 2.5 billion yen year-on-year to 1.4 billion yen (11 million U.S. dollars). This decrease was mainly due to the deterioration of equity in net income for Intertrust Technologies Corporation.

The net effect of other income and expenses was income of 26.0 billion yen (216 million U.S. dollars), compared to an expense of 5.8 billion yen in the same period of the previous fiscal year. This was primarily due to an increase in the gain on sales of securities investments.

Income before income taxes was 210.9 billion yen (1,758 million U.S. dollars) compared to loss of 21.6 billion yen in the same period of the previous fiscal year.

Income taxes: During the current six months, Sony recorded 63.7 billion yen (531 million U.S. dollars) of income tax expense, resulting in an effective tax rate of 30.2%. This effective tax rate was lower than the Japanese statutory tax rate primarily as a result of profits recorded in the insurance business, which is subject to lower tax rates, coupled with lower income tax expenses due to profits recorded at Sony Corporation and its national tax filing group in Japan which currently have valuation allowances. In the same period of the previous fiscal year, 56.1 billion yen of income tax expense was recorded despite the net loss before income taxes. This was primarily due to the nondeductible goodwill impairment recorded during the same period of the previous fiscal year.

Net income attributable to Sony Corporation’s stockholders of 116.0 billion yen (967 million U.S. dollars) was recorded in the current six months, compared to a loss of 109.2 billion yen in the same period of the previous fiscal year.

* * * * *

Cash Flows

For Consolidated Statements of Cash Flows, charts showing Sony’s cash flow information for all segments, all segments excluding the Financial Services segment and the Financial Services segment alone, please refer to pages F-5 and F-17.

Operating Activities: During the current six months, there was a net cash inflow of 25.5 billion yen (213 million U.S. dollars) from operating activities, a decrease of 78.5 billion yen, or 75.5% year-on-year.

For all segments excluding the Financial Services segment, there was a net cash outflow of 211.9 billion yen (1,766 million U.S. dollars), an increase of 101.7 billion yen, or 92.3% year-on-year. This increase was primarily due to a larger increase in inventories and an increase in film costs, partially offset by factors such as a larger increase in notes and accounts payable, trade.

The Financial Services segment had a net cash inflow of 247.9 billion yen (2,066 million U.S. dollars), an increase of 25.8 billion yen, or 11.6% year-on-year. This increase was primarily due to an increase in insurance premium revenue at Sony Life.

Investing Activities: During the current six months, Sony used 457.1 billion yen (3,809 million U.S. dollars) of net cash in investing activities, an increase of 174.2 billion yen, or 61.6% year-on-year.

For all segments excluding the Financial Services segment, there was a net cash outflow of 93.5 billion yen (779 million U.S. dollars), an increase of 93.4 billion yen. The net cash outflow was due to factors such as an increase in the amount of fixed asset purchases, partially offset by factors such as cash inflow from the sale of certain shares of Olympus Corporation.

The Financial Services segment used 363.5 billion yen (3,029 million U.S. dollars) of net cash, an increase of 80.8 billion yen, or 28.6% year-on-year. This increase was mainly due to a year-on-year increase in payments for investments and advances at Sony Life.

In all segments excluding the Financial Services segment, net cash used in operating and investing activities combined*1 for the current six months was 305.4 billion yen (2,545 million U.S. dollars), an increase of 195.1 billion yen, or 176.9% year-on-year.

Financing Activities: Net cash provided by financing activities during the current six months was 501.3 billion yen (4,178 million U.S. dollars), compared to a net cash outflow of 273.0 billion yen in the same period of the previous fiscal year.

For all segments excluding the Financial Services segment, there was a 324.8 billion yen (2,707 million U.S. dollars) net cash inflow, compared to a net cash outflow of 255.4 billion yen in the same period of the previous fiscal year. This change was primarily due to the issuance of new stock and convertible bonds in the current quarter.

In the Financial Services segment, financing activities provided 166.0 billion yen (1,383 million U.S. dollars) of net cash, compared to 25.5 billion yen of net cash used in the same period of the previous fiscal year. This change was primarily due to an increase in short-term borrowings at Sony Life.

Total Cash and Cash Equivalents: Accounting for the above factors and the effect of fluctuations in foreign exchange rates, the total outstanding balance of cash and cash equivalents at September 30, 2015 was 1,010.1 billion yen (8,418 million U.S. dollars). Cash and cash equivalents of all segments excluding the Financial Services segment was 752.2 billion yen (6,269 million U.S. dollars) at September 30, 2015, an increase of 295.9 billion yen, or 64.8% compared with the balance as of September 30, 2014, and an increase of 10.3 billion yen, or 1.4% compared with the balance as of March 31, 2015. Sony believes that it continues to maintain sufficient liquidity through access to a total, translated into yen, of 536.9 billion yen (4,474 million U.S. dollars) of unused committed lines of credit with financial institutions in addition to the cash and cash equivalents balance at September 30, 2015. Within the Financial Services segment, the outstanding balance of cash and cash equivalents was 257.9 billion yen (2,149 million U.S. dollars) at September 30, 2015, an increase of 103.7 billion yen, or 67.3% compared with the balance as of September 30, 2014, and an increase of 50.4 billion yen, or 24.3% compared with the balance as of March 31, 2015.

Sony has included the information for cash flow from operating and investing activities combined, excluding the Financial Services segment’s activities, as Sony’s management frequently monitors this financial measure, and believes this non-U.S. GAAP measurement is important for use in evaluating Sony’s ability to generate cash to maintain liquidity and fund debt principal and dividend payments from business activities other than its Financial Services segment. This information is derived from the reconciliations prepared in the Condensed Statements of Cash Flows on page F-17. This information and the separate condensed presentations shown below are not required or prepared in accordance with U.S. GAAP. The Financial Services segment’s cash flow is excluded from the measure because SFH, which constitutes a majority of the Financial Services segment, is a separate publicly traded entity in Japan with a significant minority interest and it, as well as its subsidiaries, secure liquidity on their own. This measure may not be comparable to those of other companies. This measure has limitations because it does not represent residual cash flows available for discretionary expenditures principally due to the fact that the measure does not deduct the principal payments required for debt service. Therefore, Sony believes it is important to view this measure as supplemental to its entire statement of cash flows and together with Sony’s disclosures regarding investments, available credit facilities and overall liquidity.

A reconciliation of the differences between the Consolidated Statements of Cash Flows reported and cash flows from operating and investing activities combined excluding the Financial Services segment’s activities is as follows:

	(Billions of yen, millions of U.S. dollars)
	Six months ended September 30
	2014			2015			2015

Net cash provided by operating activities reported in the consolidated statements of cash flows	¥	104.1		¥	25.5		$	213
Net cash used in investing activities reported in the consolidated statements of cash flows		(282.9	)		(457.1	)		(3,809	)
		(178.8	)		(431.6	)		(3,596	)

Less: Net cash provided by operating activities within the Financial Services segment		222.1			247.9			2,066
Less: Net cash used in investing activities within the Financial Services segment		(282.8	)		(363.5	)		(3,029	)
Eliminations *2		7.8			10.6			88

Cash flow used by operating and investing activities combined excluding the Financial Services segment’s activities	¥	(110.3	)	¥	(305.4	)	$	(2,545	)

*2	Eliminations primarily consist of intersegment dividend payments.

Notes

Business Segment Realignment

Sony realigned its business segments from the first quarter of the fiscal year ending March 31, 2016 to reflect modifications to its organizational structure as of April 1, 2015, primarily repositioning certain operations in All Other and the Devices segment. In connection with this realignment, the operations of Sony’s disc manufacturing business in Japan, which were included in All Other, are now included in the Music segment and the operations of So-net Corporation and its subsidiaries, which were included in All Other, are now included in the MC segment. Certain operations regarding pre-installed automotive audio products which were included in the Devices segment are now included in the HE&S segment.

In connection with these realignments, the sales and operating income (loss) of each segment in the fiscal year ended March 31, 2015 have been reclassified to conform to the presentation of the fiscal year ending March 31, 2016.

Impact of Foreign Exchange Rate Fluctuations on Sales and Operating Income (Loss)

For all segments other than Pictures and Music, the impact of foreign exchange rate fluctuations on sales is calculated by applying the change in the yen’s periodic weighted average exchange rates for the three and six months ended September 30, 2014 from the three and six months ended September 30, 2015 to the major transactional currencies in which the sales are denominated. The impact of foreign exchange rate fluctuations on operating income (loss) described herein is calculated by subtracting from the impact on sales the impact on cost of sales and selling, general and administrative expenses calculated by applying the same major transactional currencies calculation process to cost of sales and selling, general and administrative expenses as for the impact on sales. Since the worldwide subsidiaries of the Pictures segment and of SME and Sony/ATV in the Music segment are aggregated on a U.S. dollar basis and are translated into yen, the impact of foreign exchange rate fluctuations is calculated by applying the change in the periodic weighted average exchange rates for the three and six months ended September 30, 2014 from the three and six months ended September 30, 2015 from U.S. dollar to yen to the U.S. dollar basis operating results. This information is not a substitute for Sony’s consolidated financial statements measured in accordance with U.S. GAAP. However, Sony believes that these disclosures provide additional useful analytical information to investors regarding the operating performance of Sony.

* * * * *

Outlook for the Fiscal Year Ending March 31, 2016

The forecast for consolidated results for the fiscal year ending March 31, 2016, as announced on July 30, 2015, remains unchanged, as per the table below.

	(Billions of yen)
	October Forecast		March 31, 2015 Results			Change from March 31, 2015 Results
Sales and operating revenue	¥	7,900	¥	8,215.9			-3.8	%
Operating income		320		68.5		+ ¥251.5 bil
Income before income taxes		345		39.7		+ ¥305.3 bil
Net income (loss) attributable to Sony Corporation’s stockholders		140		(126.0	)	+ ¥266.0 bil

Assumed foreign currency exchange rates for the remainder of the fiscal year ending March 31, 2016 are the following. Due to the recent volatility in foreign exchange rates, the assumed foreign currency exchange rates were revised after the individual segments had already completed their forecasts. Accordingly, the impact of the difference between the currently assumed rates and the rates used when the individual segments completed their forecasts has been included in the forecast for All Other.

Assumed foreign currency exchange rates for the remainder of the current fiscal year

	Consolidated forecast	Forecasts for each segment
1 U.S. dollar	approximately 125 yen	approximately 121 yen
1 Euro	approximately 130 yen	approximately 132 yen

(For your reference)

Assumed foreign currency exchange rates for the remainder of the current fiscal year at the time of the July forecast

	Consolidated forecast	Forecasts for each segment
1 U.S. dollar	approximately 125 yen	approximately 123 yen
1 Euro	approximately 130 yen	approximately 134 yen

In order to reflect a change as of October 1, 2015 in the Corporate Executive Officer in charge of the medical business, which was previously included in All Other, this business will be included in the IP&S segment from the third quarter of the fiscal year ending March 31, 2016. In connection with this business segment realignment, the sales and operating revenue and operating income (loss) of the IP&S segment and All Other for the fiscal year ended March 31, 2015 and the July forecast for the fiscal year ending March 31, 2016 have been reclassified in the chart below to conform to the presentation of the October forecast.

Restructuring charges are expected to be approximately 35 billion yen for Sony in the fiscal year ending March 31, 2016, compared to 98.0 billion yen recorded in the fiscal year ended March 31, 2015. This amount will be recorded as an operating expense included in the above-mentioned forecast for operating income.

The forecast for each business segment has been revised as follows:

	(Billions of yen)									Change - October Forecast from
	October Forecast			July Forecast			March 31, 2015 Results			July Forecast	March 31, 2015 Results
Mobile Communications
Sales and operating revenue	¥	1,190		¥	1,190		¥	1,410.2		-	-15.6%
Operating loss		(60	)		(60	)		(217.6	)	-	+ ¥157.6 bil
Game & Network Services
Sales and operating revenue		1,520			1,490			1,388.0		+2.0%	+9.5%
Operating income		80			60			48.1		+ ¥20.0 bil	+ ¥31.9 bil
Imaging Products & Solutions
Sales and operating revenue		720			730			723.9		-1.4%	-0.5%
Operating income		58			48			41.8		+ ¥10.0 bil	+ ¥16.2 bil
Home Entertainment & Sound
Sales and operating revenue		1,140			1,160			1,238.1		-1.7%	-7.9%
Operating income		25			22			24.1		+ ¥3.0 bil	+ ¥0.9 bil
Devices
Sales and operating revenue		1,060			1,100			927.1		-3.6%	+14.3%
Operating income		121			121			89.0		-	+ ¥32.0 bil
Pictures
Sales and operating revenue		1,000			1,020			878.7		-2.0%	+13.8%
Operating income		35			64			58.5		- ¥29.0 bil	- ¥23.5 bil
Music
Sales and operating revenue		550			550			559.2		-	-1.7%
Operating income		74			74			60.6		-	+ ¥13.4 bil
Financial Services
Financial services revenue		1,060			1,060			1,083.6		-	-2.2%
Operating income		175			175			193.3		-	- ¥18.3 bil
All Other, Corporate and Elimination
Operating loss		(188	)		(184	)		(229.3	)	- ¥4.0 bil	+ ¥41.3 bil
Consolidated
Sales and operating revenue		7,900			7,900			8,215.9		-	-3.8%
Operating income		320			320			68.5		-	+ ¥251.5 bil

Game & Network Services

Sales are expected to be higher than the July forecast primarily due to an expected increase in PS4 hardware unit sales and PS4 software sales. Operating income is expected to be above the July forecast primarily due to an increase in PS4 software sales and PS4 hardware cost reductions.

Imaging Products & Solutions

Sales are expected to be lower than the July forecast primarily due to the impact of foreign exchange rates, partially offset by an upward revision in the annual unit sales forecast for digital cameras. Operating income is expected to be higher than the July forecast primarily due to an improvement in the product mix of digital cameras reflecting a shift to high value-added models, partially offset by the above-mentioned decrease in sales.

Home Entertainment & Sound

Sales are expected to be lower than the July forecast primarily due to the impact of foreign exchange rates. Operating income is expected to be higher than the July forecast primarily due to cost reductions and an improvement in product mix reflecting a shift to high value-added models, partially offset by the negative impact of foreign exchange rates.

Devices

Sales are expected to be lower than the July forecast mainly due to a decrease in sales of lithium-ion polymer batteries and the impact of a temporary decrease in image sensor production due to a production equipment problem. Although this production equipment problem has been remedied, sales are expected to decrease in the second half of the current fiscal year as well. The forecast for operating income remains unchanged from the July forecast mainly due to the above-mentioned decrease in sales being offset mainly by an increase in productivity and yield in the image sensor business as well as a reduction in costs.

Sony is currently in the process of its annual review of its Mid-Range Plan, including for the battery business, which process is ongoing. With regard to the battery business, increasingly competitive markets affected the current quarter’s financial performance, are a factor in revising downward the full-year forecast, and could continue to adversely affect this business. It is therefore possible that the above-described business environment might result in an impairment charge against long-lived assets in the battery business.

Pictures

Sales are expected to be lower than the July forecast primarily due to a decrease in Television Productions, Motion Pictures and Media Network sales. Operating income is expected to be lower than the July forecast primarily due to lower than expected earnings from Motion Pictures’ current year film slate and the negative impact of foreign exchange rates and lower advertising revenues in Media Networks.

The forecasts for sales and operating income for the MC, Music and Financial Services segments remain unchanged from the July forecast.

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

The forecast for capital expenditures, depreciation and amortization, as well as research and development expenses for the current fiscal year remains unchanged from the July forecast.

Consolidated

	(Billions of yen)
	October Forecast		March 31, 2015 Results		Change from March 31, 2015 Results
Capital expenditures*	¥	510	¥	251.0		+103.1	%
[additions to property, plant and equipment (included above)		430		164.8		+160.9	]
[additions to intangible assets (included above) *		80		86.2		-7.2	]
Depreciation and amortization**		365		354.6		+2.9
[for property, plant and equipment (included above)		175		165.9		+5.5	]
[for intangible assets (included above)		190		188.8		+0.7	]
Research and development expenses		490		464.3		+5.5

*	Does not include the increase in intangible assets resulting from business acquisitions.

**	The forecast for depreciation and amortization includes amortization expenses for deferred insurance acquisition costs.

Sony without Financial Services

	(Billions of yen)
	October Forecast		March 31, 2015 Results		Change from March 31, 2015 Results
Capital expenditures*	¥	501	¥	243.9		+105.4	%
[additions to property, plant and equipment (included above)		428		163.4		+161.9	]
[additions to intangible assets (included above) *		73		80.5		-9.3	]
Depreciation and amortization**		294		288.4		+1.9
[for property, plant and equipment (included above)		174		164.7		+5.7	]
[for intangible assets (included above)		120		123.7		-3.0	]

* Does not include the increase in intangible assets resulting from business acquisitions.

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

Cautionary Statement

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

(i)	the global economic environment in which Sony operates and the economic conditions in Sony’s markets, particularly levels of consumer spending;

(ii)	foreign exchange rates, particularly between the yen and the U.S. dollar, the euro and other currencies in which Sony makes significant sales and incurs production costs, or in which Sony’s assets and liabilities are denominated;

(iii)

Sony’s ability to continue to design and develop and win acceptance of, as well as achieve sufficient cost reductions for, its products and services, including televisions, game platforms and smartphones, which are offered in highly competitive markets characterized by severe price competition and continual new product and service introductions, rapid development in technology and subjective and changing consumer preferences;

(iv)	Sony’s ability and timing to recoup large-scale investments required for technology development and production capacity;

(v)	Sony’s ability to implement successful business restructuring and transformation efforts under changing market conditions;

(vi)	Sony’s ability to implement successful hardware, software, and content integration strategies for all segments excluding the Financial Services segment, and to develop and implement successful sales and distribution strategies in light of the Internet and other technological developments;

(vii)

Sony’s continued ability to devote sufficient resources to research and development and, with respect to capital expenditures, to prioritize investments correctly (particularly in the electronics businesses);

(viii)

Sony’s ability to maintain product quality;

(ix)	the effectiveness of Sony’s strategies and their execution, including but not limited to the success of Sony’s acquisitions, joint ventures and other strategic investments;

(x)	significant volatility and disruption in the global financial markets or a ratings downgrade;

(xi)	Sony’s ability to forecast demands, manage timely procurement and control inventories;

(xii)

the outcome of pending and/or future legal and/or regulatory proceedings;

(xiii)

shifts in customer demand for financial services such as life insurance and Sony’s ability to conduct successful asset liability management in the Financial Services segment;

(xiv)

the impact of unfavorable conditions or developments (including market fluctuations or volatility) in the Japanese equity markets on the revenue and operating income of the Financial Services segment;

(xv)	Sony’s ability to anticipate and manage cybersecurity risk, including the risk of unauthorized access to Sony’s business information, potential business disruptions or financial losses; and

(xvi)

risks related to catastrophic disasters or similar events.

Risks and uncertainties also include the impact of any future events with material adverse impact.

Investor Relations Contacts:
Tokyo	New York	London
Atsuko Murakami	Justin Hill	Haruna Nagai
+81-(0)3-6748-2111	+1-212-833-6722	+44-(0)19-3281-6000

IR home page: http://www.sony.net/IR/

Presentation slides: http://www.sony.net/SonyInfo/IR/financial/fr/15q2_sonypre.pdf

(Unaudited)
Consolidated Financial Statements
Consolidated Balance Sheets
	(Millions of yen, millions of U.S. dollars)
	March 31			September 30			Change from		September 30
ASSETS	2015			2015			March 31, 2015		2015
Current assets:
Cash and cash equivalents	¥	949,413		¥	1,010,120		¥	+60,707	$	8,418
Marketable securities		936,731			889,623			-47,108		7,414
Notes and accounts receivable, trade		986,500			1,095,632			+109,132		9,130
Allowance for doubtful accounts and sales returns		(86,598	)		(86,948	)		-350		(725	)
Inventories		665,432			948,171			+282,739		7,901
Other receivables		231,947			321,395			+89,448		2,678
Deferred income taxes		47,788			50,675			+2,887		422
Prepaid expenses and other current assets		466,688			480,526			+13,838		4,005
Total current assets		4,197,901			4,709,194			+511,293		39,243

Film costs		305,232			384,676			+79,444		3,206

Investments and advances:
Affiliated companies		171,063			168,905			-2,158		1,408
Securities investments and other		8,360,290			8,640,342			+280,052		72,002
		8,531,353			8,809,247			+277,894		73,410

Property, plant and equipment:
Land		123,629			123,027			-602		1,025
Buildings		679,125			681,927			+2,802		5,683
Machinery and equipment		1,764,241			1,820,603			+56,362		15,172
Construction in progress		35,786			61,013			+25,227		508
		2,602,781			2,686,570			+83,789		22,388
Less-Accumulated depreciation		1,863,496			1,870,998			+7,502		15,592
		739,285			815,572			+76,287		6,796

Other assets:
Intangibles, net		642,361			635,791			-6,570		5,298
Goodwill		561,255			610,738			+49,483		5,089
Deferred insurance acquisition costs		520,571			530,231			+9,660		4,419
Deferred income taxes		89,637			81,847			-7,790		682
Other		246,736			253,882			+7,146		2,117
		2,060,560			2,112,489			+51,929		17,605
Total assets	¥	15,834,331		¥	16,831,178		¥	+996,847	$	140,260

LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings	¥	62,008		¥	273,133		¥	+211,125	$	2,276
Current portion of long-term debt		159,517			149,454			-10,063		1,245
Notes and accounts payable, trade		622,215			881,130			+258,915		7,343
Accounts payable, other and accrued expenses		1,374,099			1,374,279			+180		11,452
Accrued income and other taxes		98,414			105,653			+7,239		880
Deposits from customers in the banking business		1,872,965			1,790,920			-82,045		14,924
Other		556,372			543,601			-12,771		4,531
Total current liabilities		4,745,590			5,118,170			+372,580		42,651

Long-term debt		712,087			766,675			+54,588		6,389
Accrued pension and severance costs		298,753			297,205			-1,548		2,477
Deferred income taxes		445,876			425,809			-20,067		3,548
Future insurance policy benefits and other		4,122,372			4,316,443			+194,071		35,970
Policyholders’ account in the life insurance business		2,259,514			2,308,890			+49,376		19,241
Other		316,422			324,509			+8,087		2,705
Total liabilities		12,900,614			13,557,701			+657,087		112,981

Redeemable noncontrolling interest		5,248			7,475			+2,227		62

Equity:
Sony Corporation’s stockholders’ equity:
Common stock		707,038			858,522			+151,484		7,154
Additional paid-in capital		1,185,777			1,323,906			+138,129		11,033
Retained earnings		813,765			917,146			+103,381		7,643
Accumulated other comprehensive income		(385,283	)		(451,022	)		-65,739		(3,759	)
Treasury stock, at cost		(4,220	)		(4,205	)		+15		(35	)
		2,317,077			2,644,347			+327,270		22,036
Noncontrolling interests		611,392			621,655			+10,263		5,181
Total equity		2,928,469			3,266,002			+337,533		27,217
Total liabilities and equity	¥	15,834,331		¥	16,831,178		¥	+996,847	$	140,260

F-1

Consolidated Statements of Income
	(Millions of yen, millions of U.S. dollars, except per share amounts)
	Three months ended September 30
	2014			2015			Change from 2014			2015
Sales and operating revenue:
Net sales	¥	1,606,159		¥	1,663,614					$	13,864
Financial services revenue		268,192			209,035						1,742
Other operating revenue		27,160			20,091						167
		1,901,511			1,892,740			-0.5	%		15,773

Costs and expenses:
Cost of sales		1,168,883			1,228,226						10,236
Selling, general and administrative		419,203			418,308						3,486
Financial services expenses		220,831			167,076						1,392
Other operating (income) expense, net		178,811			(7,945	)					(66	)
		1,987,728			1,805,665			-9.2			15,048

Equity in net income of affiliated companies		629			943			+49.9			8

Operating income (loss)		(85,588	)		88,018		–				733

Other income:
Interest and dividends		2,337			3,664						31
Gain on sale of securities investments, net		2,386			795						7
Other		1,465			539						4
		6,188			4,998			-19.2			42

Other expenses:
Interest		6,047			6,581						55
Foreign exchange loss, net		2,592			12,602						105
Other		1,916			1,639						13
		10,555			20,822			+97.3			173

Income (loss) before income taxes		(89,955	)		72,194		–				602

Income taxes		30,078			23,866						199

Net income (loss)		(120,033	)		48,328		–				403

Less - Net income attributable to noncontrolling interests		15,936			14,775						123

Net income (loss) attributable to Sony Corporation’s stockholders	¥	(135,969	)	¥	33,553		–		%	$	280

Per share data:
Net income (loss) attributable to Sony Corporation’s stockholders
— Basic	¥	(124.32	)	¥	26.64		–		%	$	0.22
— Diluted		(124.32	)		26.10		–				0.22


Consolidated Statements of Comprehensive Income
	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
	2014			2015			Change from 2014			2015

Net income (loss)	¥	(120,033	)	¥	48,328		–		%	$	403

Other comprehensive income, net of tax –
Unrealized gains (losses) on securities		13,191			(10,800	)					(90	)
Unrealized losses on derivative instruments	－				(1,105	)					(9	)
Pension liability adjustment		414			705						6
Foreign currency translation adjustments		51,557			(39,508	)					(330	)

Total comprehensive loss		(54,871	)		(2,380	)	–				(20	)

Less - Comprehensive income attributable to noncontrolling interests		19,655			12,910						107

Comprehensive loss attributable to Sony Corporation’s stockholders	¥	(74,526	)	¥	(15,290	)	–		%	$	(127	)

F-2

Consolidated Statements of Income
	(Millions of yen, millions of U.S. dollars, except per share amounts)
	Six months ended September 30
	2014			2015			Change from 2014			2015
Sales and operating revenue:
Net sales	¥	3,145,965		¥	3,166,925					$	26,391
Financial services revenue		513,942			486,724						4,056
Other operating revenue		51,512			47,150						393
		3,711,419			3,700,799			-0.3	%		30,840

Costs and expenses:
Cost of sales		2,319,722			2,362,495						19,687
Selling, general and administrative		829,650			797,030						6,642
Financial services expenses		422,509			399,114						3,326
Other operating (income) expense, net		159,142			(41,399	)					(345	)
		3,731,023			3,517,240			-5.7			29,310

Equity in net income of affiliated companies		3,830			1,366			-64.3			11

Operating income (loss)		(15,774	)		184,925		–				1,541

Other income:
Interest and dividends		5,752			6,316						53
Gain on sale of securities investments, net		7,586			51,577						430
Other		2,082			1,186						10
		15,420			59,079			+283.1			493

Other expenses:
Interest		12,459			10,975						91
Foreign exchange loss, net		4,568			18,348						153
Other		4,197			3,777						32
		21,224			33,100			+56.0			276

Income (loss) before income taxes		(21,578	)		210,904		–				1,758

Income taxes		56,124			63,678						531

Net income (loss)		(77,702	)		147,226		–				1,227

Less - Net income attributable to noncontrolling interests		31,459			31,232						260

Net income (loss) attributable to Sony Corporation’s stockholders	¥	(109,161	)	¥	115,994		–		%	$	967

Per share data:
Net income (loss) attributable to Sony Corporation’s stockholders
— Basic	¥	(102.14	)	¥	95.53		–		%	$	0.80
— Diluted		(102.14	)		94.41		–				0.79


Consolidated Statements of Comprehensive Income
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
	2014			2015			Change from 2014			2015

Net income (loss)	¥	(77,702	)	¥	147,226		–		%	$	1,227

Other comprehensive income, net of tax –
Unrealized gains (losses) on securities		15,066			(57,866	)					(483	)
Unrealized losses on derivative instruments	－				(1,741	)					(15	)
Pension liability adjustment		750			907						8
Foreign currency translation adjustments		30,717			(11,901	)					(99	)

Total comprehensive income (loss)		(31,169	)		76,625		–				638

Less - Comprehensive income attributable to noncontrolling interests		38,382			26,370						220

Comprehensive income (loss) attributable to Sony Corporation’s stockholders	¥	(69,551	)	¥	50,255		–		%	$	418

F-3

Supplemental equity and comprehensive income information
	(Millions of yen, millions of U.S. dollars)
	Sony Corporation’s stockholders’ equity			Noncontrolling interests			Total equity
Balance at March 31, 2014	¥	2,258,137		¥	525,004		¥	2,783,141
Exercise of stock acquisition rights		91			–			91
Conversion of zero coupon convertible bonds		100,400			–			100,400
Stock based compensation		529			–			529

Comprehensive income:
Net income (loss)		(109,161	)		31,459			(77,702	)
Other comprehensive income, net of tax –
Unrealized gains on securities		10,427			4,639			15,066
Pension liability adjustment		788			(38	)		750
Foreign currency translation adjustments		28,395			2,322			30,717
Total comprehensive income (loss)		(69,551	)		38,382			(31,169	)

Dividends declared		–			(12,270	)		(12,270	)
Transactions with noncontrolling interests shareholders and other		(2,837	)		1,296			(1,541	)
Balance at September 30, 2014	¥	2,286,769		¥	552,412		¥	2,839,181

Balance at March 31, 2015	¥	2,317,077		¥	611,392		¥	2,928,469
Issuance of new shares		301,708			–			301,708
Exercise of stock acquisition rights		1,260			–			1,260
Stock based compensation		586			–			586

Comprehensive income:
Net income		115,994			31,232			147,226
Other comprehensive income, net of tax –
Unrealized losses on securities		(52,865	)		(5,001	)		(57,866	)
Unrealized losses on derivative instruments		(1,741	)		–			(1,741	)
Pension liability adjustment		904			3			907
Foreign currency translation adjustments		(12,037	)		136			(11,901	)
Total comprehensive income		50,255			26,370			76,625

Dividends declared		(12,612	)		(18,655	)		(31,267	)
Transactions with noncontrolling interests shareholders and other		(13,927	)		2,548			(11,379	)
Balance at September 30, 2015	¥	2,644,347		¥	621,655		¥	3,266,002

On July 21, 2015, Sony issued 87,200,000 new shares of common stock by way of a Japanese public offering and an international offering. In addition, on August 18, 2015, Sony issued 4,800,000 new shares of common stock by way of third-party allotment in connection with secondary offering of shares to cover over-allotments.


	Sony Corporation’s stockholders’ equity			Noncontrolling interests			Total equity
Balance at March 31, 2015	$	19,310		$	5,095		$	24,405
Issuance of new shares		2,514			–			2,514
Exercise of stock acquisition rights		11			–			11
Stock based compensation		5			–			5

Comprehensive income:
Net income		967			260			1,227
Other comprehensive income, net of tax –
Unrealized losses on securities		(442	)		(41	)		(483	)
Unrealized losses on derivative instruments		(15	)		–			(15	)
Pension liability adjustment		8			0			8
Foreign currency translation adjustments		(100	)		1			(99	)
Total comprehensive income		418			220			638

Dividends declared		(106	)		(155	)		(261	)
Transactions with noncontrolling interests shareholders and other		(116	)		21			(95	)
Balance at September 30, 2015	$	22,036		$	5,181		$	27,217

F-4

Consolidated Statements of Cash Flows
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
	2014			2015			2015
Cash flows from operating activities:
Net income (loss)	¥	(77,702	)	¥	147,226		$	1,227
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization, including amortization of deferred insurance acquisition costs		166,747			184,055			1,534
Amortization of film costs		127,868			118,669			989
Accrual for pension and severance costs, less payments		(5,754	)		(4,794	)		(40	)
Other operating (income) expense, net		159,142			(41,399	)		(345	)
Gain on sale or devaluation of securities investments, net		(7,582	)		(51,572	)		(430	)
(Gain) loss on revaluation of marketable securities held in the financial services business for trading purposes, net		(37,019	)		46,866			391
(Gain) loss on revaluation or impairment of securities investments held in the financial services business, net		(1,251	)		2,666			22
Deferred income taxes		(1,783	)		10,421			87
Equity in net income of affiliated companies, net of dividends		681			307			3
Changes in assets and liabilities:
Increase in notes and accounts receivable, trade		(102,544	)		(105,253	)		(877	)
Increase in inventories		(190,425	)		(298,961	)		(2,491	)
Increase in film costs		(129,316	)		(200,044	)		(1,667	)
Increase in notes and accounts payable, trade		163,389			262,949			2,191
Increase in accrued income and other taxes		19,036			4,657			39
Increase in future insurance policy benefits and other		223,669			176,455			1,470
Increase in deferred insurance acquisition costs		(38,560	)		(45,273	)		(377	)
Increase in marketable securities held in the financial services business for trading purposes		(30,631	)		(46,947	)		(391	)
Increase in other current assets		(100,128	)		(79,972	)		(666	)
Increase (decrease) in other current liabilities		1,836			(77,940	)		(650	)
Other		(35,598	)		23,425			194
Net cash provided by operating activities		104,075			25,541			213

Cash flows from investing activities:
Payments for purchases of fixed assets		(95,778	)		(161,954	)		(1,350	)
Proceeds from sales of fixed assets		30,407			10,049			84
Payments for investments and advances by financial services business		(459,625	)		(706,663	)		(5,889	)
Payments for investments and advances (other than financial services business)		(9,408	)		(7,252	)		(60	)
Proceeds from sales or return of investments and collections of advances by financial services business		232,550			347,989			2,900
Proceeds from sales or return of investments and collections of advances (other than financial services business)		32,916			78,104			651
Proceeds from sales of businesses		–			17,790			148
Other		(13,921	)		(35,135	)		(293	)
Net cash used in investing activities		(282,859	)		(457,072	)		(3,809	)

Cash flows from financing activities:
Proceeds from issuance of long-term debt		12,471			19,627			164
Payments of long-term debt		(231,652	)		(104,768	)		(873	)
Increase (decrease) in short-term borrowings, net		(926	)		213,787			1,782
Decrease in deposits from customers in the financial services business, net		(22,750	)		(14,561	)		(121	)
Proceeds from issuance of convertible bonds		–			120,000			1,000
Proceeds from issuance of new shares		–			301,708			2,514
Dividends paid		(13,060	)		(105	)		(1	)
Other		(17,100	)		(34,381	)		(287	)
Net cash provided by (used in) financing activities		(273,017	)		501,307			4,178

Effect of exchange rate changes on cash and cash equivalents		15,844			(9,069	)		(76	)

Net increase (decrease) in cash and cash equivalents		(435,957	)		60,707			506
Cash and cash equivalents at beginning of the fiscal year		1,046,466			949,413			7,912

Cash and cash equivalents at end of the period	¥	610,509		¥	1,010,120		$	8,418

F-5

Business Segment Information
	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Sales and operating revenue	2014			2015			Change			2015

Mobile Communications
Customers	¥	329,212		¥	278,279			-15.5	%	$	2,319
Intersegment		254			946						8
Total		329,466			279,225			-15.2			2,327

Game & Network Services
Customers		285,754			341,082			+19.4			2,842
Intersegment		23,725			19,600						164
Total		309,479			360,682			+16.5			3,006

Imaging Products & Solutions
Customers		177,152			183,156			+3.4			1,526
Intersegment		1,458			2,855						24
Total		178,610			186,011			+4.1			1,550

Home Entertainment & Sound
Customers		288,864			288,201			-0.2			2,402
Intersegment		795			864						7
Total		289,659			289,065			-0.2			2,409

Devices
Customers		173,846			203,981			+17.3			1,700
Intersegment		66,569			54,122						451
Total		240,415			258,103			+7.4			2,151

Pictures
Customers		181,907			183,586			+0.9			1,530
Intersegment		276			156						1
Total		182,183			183,742			+0.9			1,531

Music
Customers		116,716			135,079			+15.7			1,126
Intersegment		3,903			3,592						30
Total		120,619			138,671			+15.0			1,156

Financial Services
Customers		268,192			209,035			-22.1			1,742
Intersegment		1,384			1,697						14
Total		269,576			210,732			-21.8			1,756

All Other
Customers		64,872			63,967			-1.4			533
Intersegment		21,657			23,401						195
Total		86,529			87,368			+1.0			728

Corporate and elimination		(105,025	)		(100,859	)	–				(841	)
Consolidated total	¥	1,901,511		¥	1,892,740			-0.5	%	$	15,773

Game & Network Services (“G&NS”) intersegment amounts primarily consist of transactions with All Other.

Devices intersegment amounts primarily consist of transactions with the Mobile Communications (“MC”) segment, the G&NS segment and the Imaging Products & Solutions (“IP&S”) segment.

All Other intersegment amounts primarily consist of transactions with the Pictures segment, the Music segment and the G&NS segment.

Corporate and elimination includes certain brand and patent royalty income.


	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Operating income (loss)	2014			2015			Change			2015
Mobile Communications	¥	(170,588	)	¥	(20,601	)		–	%	$	(172	)
Game & Network Services		21,790			23,920			+9.8			199
Imaging Products & Solutions		20,098			25,854			+28.6			215
Home Entertainment & Sound		9,065			15,763			+73.9			131
Devices		28,335			32,690			+15.4			272
Pictures		(1,041	)		(22,466	)		–			(187	)
Music		12,163			14,590			+20.0			122
Financial Services		47,686			41,175			-13.7			343
All Other		(19,784	)		456			–			5
Total		(52,276	)		111,381			–			928

Corporate and elimination		(33,312	)		(23,363	)		–			(195	)
Consolidated total	¥	(85,588	)	¥	88,018			–	%	$	733

The 2014 segment disclosure above has been reclassified to reflect the change in the business segment classification discussed in Note 5.

Operating income (loss) is sales and operating revenue less costs and expenses, and includes equity in net income (loss) of affiliated companies.

Corporate and elimination includes headquarters restructuring costs, restructuring costs related to the reduction in scale of sales companies following the decision to exit from the PC business, and certain other corporate expenses, including the amortization of certain intellectual property assets such as the cross-licensing of intangible assets acquired from Ericsson at the time of the Sony Mobile Communications acquisition, which are not allocated to segments.

Within the Home Entertainment & Sound (“HE&S”) segment, the operating income of Televisions, which primarily consists of LCD televisions, for the three months ended September 30, 2014 and 2015 was 4,922 million yen and 9,705 million yen, respectively. The operating income of Televisions excludes restructuring charges which are included in the overall segment results and are not allocated to product categories.

F-6

Business Segment Information
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Sales and operating revenue	2014			2015			Change			2015

Mobile Communications
Customers	¥	663,954		¥	557,815			-16.0	%	$	4,648
Intersegment		492			1,934						17
Total		664,446			559,749			-15.8			4,665

Game & Network Services
Customers		517,122			606,980			+17.4			5,058
Intersegment		49,887			42,291						353
Total		567,009			649,271			+14.5			5,411

Imaging Products & Solutions
Customers		341,288			351,413			+3.0			2,928
Intersegment		1,922			4,969						42
Total		343,210			356,382			+3.8			2,970

Home Entertainment & Sound
Customers		581,913			540,688			-7.1			4,506
Intersegment		1,489			1,526						12
Total		583,402			542,214			-7.1			4,518

Devices
Customers		310,581			396,986			+27.8			3,308
Intersegment		105,919			99,014						825
Total		416,500			496,000			+19.1			4,133

Pictures
Customers		376,573			355,006			-5.7			2,958
Intersegment		380			285						3
Total		376,953			355,291			-5.7			2,961

Music
Customers		231,577			262,059			+13.2			2,184
Intersegment		9,079			6,803						57
Total		240,656			268,862			+11.7			2,241

Financial Services
Customers		513,942			486,724			-5.3			4,056
Intersegment		2,601			3,394						28
Total		516,543			490,118			-5.1			4,084

All Other
Customers		147,694			124,442			-15.7			1,037
Intersegment		41,754			42,267						352
Total		189,448			166,709			-12.0			1,389

Corporate and elimination		(186,748	)		(183,797	)	–				(1,532	)
Consolidated total	¥	3,711,419		¥	3,700,799			-0.3	%	$	30,840

The G&NS intersegment amounts primarily consist of transactions with All Other.

Devices intersegment amounts primarily consist of transactions with the MC segment, the G&NS segment and the IP&S segment.

All Other intersegment amounts primarily consist of transactions with the Pictures segment, the Music segment and the G&NS segment.

Corporate and elimination includes certain brand and patent royalty income.


	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Operating income (loss)	2014			2015			Change			2015

Mobile Communications	¥	(172,197	)	¥	(43,525	)		–	%	$	(363	)
Game & Network Services		26,109			43,379			+66.1			361
Imaging Products & Solutions		37,507			47,125			+25.6			393
Home Entertainment & Sound		17,899			26,686			+49.1			222
Devices		39,835			63,032			+58.2			525
Pictures		6,790			(34,153	)		–			(285	)
Music		23,797			46,340			+94.7			386
Financial Services		91,458			87,147			-4.7			726
All Other		(39,735	)		(4,504	)		–			(36	)
Total		31,463			231,527			+635.9			1,929

Corporate and elimination		(47,237	)		(46,602	)		–			(388	)
Consolidated total	¥	(15,774	)	¥	184,925			–	%	$	1,541

The 2014 segment disclosure above has been reclassified to reflect the change in the business segment classification discussed in Note 5.

Operating income (loss) is sales and operating revenue less costs and expenses, and includes equity in net income (loss) of affiliated companies.

Within the HE&S segment, the operating income of Televisions, which primarily consists of LCD televisions, for the six months ended September 30, 2014 and 2015 was 12,838 million yen and 16,708 million yen, respectively. The operating income of Televisions excludes restructuring charges which are included in the overall segment results and are not allocated to product categories.

F-7

Sales to Customers by Product Category
	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Sales and operating revenue (to external customers)	2014		2015		Change			2015

Mobile Communications	¥	329,212	¥	278,279		-15.5	%	$	2,319

Game & Network Services
Hardware		160,689		168,434		+4.8			1,404
Network		71,123		111,534		+56.8			929
Other		53,942		61,114		+13.3			509
Total		285,754		341,082		+19.4			2,842

Imaging Products & Solutions
Digital Imaging Products		109,565		112,844		+3.0			940
Professional Solutions		64,822		67,411		+4.0			562
Other		2,765		2,901		+4.9			24
Total		177,152		183,156		+3.4			1,526

Home Entertainment & Sound
Televisions		199,742		203,008		+1.6			1,692
Audio and Video		89,023		85,162		-4.3			710
Other		99		31		-68.7		–
Total		288,864		288,201		-0.2			2,402

Devices
Semiconductors		118,095		149,510		+26.6			1,246
Components		54,287		52,216		-3.8			435
Other		1,464		2,255		+54.0			19
Total		173,846		203,981		+17.3			1,700

Pictures
Motion Pictures		97,339		91,152		-6.4			760
Television Productions		44,259		42,333		-4.4			353
Media Networks		40,309		50,101		+24.3			417
Total		181,907		183,586		+0.9			1,530

Music
Recorded Music		80,429		90,567		+12.6			755
Music Publishing		16,366		17,698		+8.1			148
Visual Media and Platform		19,921		26,814		+34.6			223
Total		116,716		135,079		+15.7			1,126

Financial Services		268,192		209,035		-22.1			1,742
All Other		64,872		63,967		-1.4			533
Corporate		14,996		6,374		-57.5			53
Consolidated total	¥	1,901,511	¥	1,892,740		-0.5	%	$	15,773

The above table includes a breakdown of sales and operating revenue to external customers for certain segments shown in the Business Segment Information on page F-6. Sony management views each segment as a single operating segment. However, Sony believes that the breakdown of sales and operating revenue to external customers for the segments in this table is useful to investors in understanding sales by product category.

Sony has realigned its product category configuration from the first quarter of the fiscal year ending March 31, 2016. In connection with the realignment, all prior period sales amounts by product category in the table above have been reclassified to conform to the current presentation.

In the G&NS segment, Hardware includes home and portable game consoles; Network includes network services relating to game, video, and music content provided by Sony Network Entertainment International LLC; Other includes packaged software and peripheral devices. In the IP&S segment, Digital Imaging Products includes compact digital cameras, interchangeable single-lens cameras and video cameras; Professional Solutions includes broadcast- and professional-use products. In the HE&S segment, Televisions includes LCD televisions; Audio and Video includes Blu-ray disc players and recorders, home audio, headphones, and memory-based portable audio devices. In the Devices segment, Semiconductors includes image sensors; Components includes batteries and recording media. In the Pictures segment, Motion Pictures includes the production, acquisition and distribution of motion pictures; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks. In the Music segment, Recorded Music includes the distribution of physical and digital recorded music and revenue derived from artists’ live performances; Music Publishing includes the management and licensing of the words and music of songs; Visual Media and Platform includes various service offerings for music and visual products and the production and distribution of animation titles.

F-8

Sales to Customers by Product Category
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Sales and operating revenue (to external customers)	2014		2015		Change			2015

Mobile Communications	¥	663,954	¥	557,815		-16.0	%	$	4,648

Game & Network Services
Hardware		297,562		297,899		+0.1			2,482
Network		140,376		217,335		+54.8			1,811
Other		79,184		91,746		+15.9			765
Total		517,122		606,980		+17.4			5,058

Imaging Products & Solutions
Digital Imaging Products		215,700		220,000		+2.0			1,833
Professional Solutions		120,538		124,531		+3.3			1,038
Other		5,050		6,882		+36.3			57
Total		341,288		351,413		+3.0			2,928

Home Entertainment & Sound
Televisions		404,731		371,928		-8.1			3,099
Audio and Video		176,437		166,473		-5.6			1,387
Other		745		2,287		+207.0			20
Total		581,913		540,688		-7.1			4,506

Devices
Semiconductors		203,043		289,925		+42.8			2,416
Components		104,326		102,371		-1.9			853
Other		3,212		4,690		+46.0			39
Total		310,581		396,986		+27.8			3,308

Pictures
Motion Pictures		201,965		149,327		-26.1			1,244
Television Productions		86,621		93,308		+7.7			778
Media Networks		87,987		112,371		+27.7			936
Total		376,573		355,006		-5.7			2,958

Music
Recorded Music		159,824		179,895		+12.6			1,499
Music Publishing		32,654		35,542		+8.8			296
Visual Media and Platform		39,099		46,622		+19.2			389
Total		231,577		262,059		+13.2			2,184

Financial Services		513,942		486,724		-5.3			4,056
All Other		147,694		124,442		-15.7			1,037
Corporate		26,775		18,686		-30.2			157
Consolidated total	¥	3,711,419	¥	3,700,799		-0.3	%	$	30,840

The above table includes a breakdown of sales and operating revenue to external customers for certain segments shown in the Business Segment Information on page F-7. Sony management views each segment as a single operating segment. However, Sony believes that the breakdown of sales and operating revenue to external customers for the segments in this table is useful to investors in understanding sales by product category.

F-9

Other Items
	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Depreciation and amortization	2014		2015		Change			2015

Mobile Communications	¥	4,951	¥	6,011		+21.4	%	$	50
Game & Network Services		4,426		4,507		+1.8			38
Imaging Products & Solutions		8,293		6,795		-18.1			57
Home Entertainment & Sound		6,138		5,806		-5.4			48
Devices		21,588		26,935		+24.8			224
Pictures		4,691		5,471		+16.6			46
Music		3,669		4,624		+26.0			39
Financial Services, including deferred insurance acquisition costs		13,602		24,044		+76.8			200
All Other		2,461		1,883		-23.5			15
Total		69,819		86,076		+23.3			717

Corporate		12,630		10,958		-13.2			92
Consolidated total	¥	82,449	¥	97,034		+17.7	%	$	809

	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30, 2014
Restructuring charges and associated depreciation	Total net restructuring charges		Depreciation associated with restructured assets		Total

Mobile Communications	¥	44	¥	–	¥	44
Game & Network Services	–		–		–
Imaging Products & Solutions		71	–			71
Home Entertainment & Sound		37	–			37
Devices		2,819		4		2,823
Pictures		16	–			16
Music		35	–			35
Financial Services	–		–		–
All Other and Corporate		6,398	–			6,398
Consolidated total	¥	9,420	¥	4	¥	9,424

	Three months ended September 30, 2015
Restructuring charges and associated depreciation	Total net restructuring charges		Depreciation associated with restructured assets		Total

Mobile Communications	¥	4,033	¥	225	¥	4,258
Game & Network Services	–		–		–
Imaging Products & Solutions		16	–			16
Home Entertainment & Sound		5	–			5
Devices		34	–			34
Pictures		121	–			121
Music		258	–			258
Financial Services	–		–		–
All Other and Corporate		774		139		913
Consolidated total	¥	5,241	¥	364	¥	5,605

Depreciation associated with restructured assets as used in the context of the disclosures regarding restructuring activities refers to the increase in depreciation expense caused by revising the useful life and the salvage value of depreciable fixed assets to coincide with the earlier end of production under an approved restructuring plan. Any impairment of the assets is recognized immediately in the period it is identified.

	Three months ended September 30, 2015
Restructuring charges and associated depreciation	Total net restructuring charges		Depreciation associated with restructured assets		Total

Mobile Communications	$	35	$	2	$	37
Game & Network Services	–		–		–
Imaging Products & Solutions		1	–			1
Home Entertainment & Sound	–		–		–
Devices	–		–		–
Pictures		1	–			1
Music		2	–			2
Financial Services	–		–		–
All Other and Corporate		6		1		7
Consolidated total	$	45	$	3	$	48

F-10

Other Items
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Depreciation and amortization	2014			2015		Change			2015

Mobile Communications	¥	11,900		¥	12,207		+2.6	%	$	102
Game & Network Services		8,426			9,147		+8.6			76
Imaging Products & Solutions		15,260			13,807		-9.5			115
Home Entertainment & Sound		12,243			11,387		-7.0			95
Devices		42,602			51,070		+19.9			426
Pictures		9,256			10,723		+15.8			89
Music		7,263			8,805		+21.2			73
Financial Services, including deferred insurance acquisition costs		29,221			40,565		+38.8			338
All Other		5,175			3,583		-30.8			30
Total		141,346			161,294		+14.1			1,344

Corporate		25,401			22,761		-10.4			190
Consolidated total	¥	166,747		¥	184,055		+10.4	%	$	1,534

	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30, 2014
Restructuring charges and associated depreciation	Total net restructuring charges			Depreciation associated with restructured assets		Total

Mobile Communications	¥	57		¥	–	¥	57
Game & Network Services		64		–			64
Imaging Products & Solutions		200		–			200
Home Entertainment & Sound		577		–			577
Devices		3,361			4		3,365
Pictures		16		–			16
Music		60		–			60
Financial Services	–			–		–
All Other and Corporate		19,678			669		20,347
Consolidated total	¥	24,013		¥	673	¥	24,686

	Six months ended September 30, 2015
Restructuring charges and associated depreciation	Total net restructuring charges			Depreciation associated with restructured assets		Total

Mobile Communications	¥	11,770		¥	540	¥	12,310
Game & Network Services		15		–			15
Imaging Products & Solutions		60		–			60
Home Entertainment & Sound		(52	)	–			(52	)
Devices		4		–			4
Pictures		170		–			170
Music		335		–			335
Financial Services	–			–		–
All Other and Corporate		2,352			542		2,894
Consolidated total	¥	14,654		¥	1,082	¥	15,736

Depreciation associated with restructured assets as used in the context of the disclosures regarding restructuring activities refers to the increase in depreciation expense caused by revising the useful life and the salvage value of depreciable fixed assets to coincide with the earlier end of production under an approved restructuring plan. Any impairment of the assets is recognized immediately in the period it is identified.

	Six months ended September 30, 2015
Restructuring charges and associated depreciation	Total net restructuring charges			Depreciation associated with restructured assets		Total

Mobile Communications	$	98		$	5	$	103
Game & Network Services	－			－		－
Imaging Products & Solutions		1		－			1
Home Entertainment & Sound	－			－		－
Devices	－			－		－
Pictures		1		－			1
Music		3		－			3
Financial Services	－			－		－
All Other and Corporate		19			4		23
Consolidated total	$	122		$	9	$	131

F-11

Geographic Information
	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Sales and operating revenue (to external customers)	2014		2015		Change			2015

Japan	¥	499,545	¥	495,531		-0.8	%	$	4,129
United States		327,838		393,618		+20.1			3,280
Europe		461,395		435,179		-5.7			3,626
China		144,540		150,595		+4.2			1,255
Asia-Pacific		259,396		237,662		-8.4			1,981
Other Areas		208,797		180,155		-13.7			1,502
Total	¥	1,901,511	¥	1,892,740		-0.5	%	$	15,773

	Six months ended September 30
Sales and operating revenue (to external customers)	2014		2015		Change			2015

Japan	¥	1,010,924	¥	1,057,112		+4.6	%	$	8,809
United States		633,124		746,011		+17.8			6,217
Europe		853,591		802,884		-5.9			6,691
China		277,581		281,296		+1.3			2,344
Asia-Pacific		504,269		476,609		-5.5			3,972
Other Areas		431,930		336,887		-22.0			2,807
Total	¥	3,711,419	¥	3,700,799		-0.3	%	$	30,840

Geographic Information shows sales and operating revenue recognized by location of customers.
Major countries and areas in each geographic segment excluding Japan, United States and China are as follows:

	(1) Europe:	United Kingdom, France, Germany, Russia, Spain and Sweden
	(2) Asia-Pacific:	India, South Korea and Oceania
	(3) Other Areas:	The Middle East/Africa, Brazil, Mexico and Canada

F-12

Condensed Financial Services Financial Statements

The results of the Financial Services segment are included in Sony’s consolidated financial statements. The following schedules show unaudited condensed financial statements for the Financial Services segment and all other segments excluding Financial Services. These presentations are not in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which is used by Sony to prepare its consolidated financial statements. However, because the Financial Services segment is different in nature from Sony’s other segments, Sony believes that a comparative presentation may be useful in understanding and analyzing Sony’s consolidated financial statements. Transactions between the Financial Services segment and Sony without the Financial Services segment, including noncontrolling interests, are included in those respective presentations, then eliminated in the consolidated figures shown below.


Condensed Balance Sheets
	(Millions of yen, millions of U.S. dollars)
Financial Services	March 31		September 30
	2015		2015		2015
ASSETS
Current assets:
Cash and cash equivalents	¥	207,527	¥	257,897	$	2,149
Marketable securities		933,424		886,371		7,386
Other		147,663		149,549		1,247
		1,288,614		1,293,817		10,782

Investments and advances		8,217,715		8,590,475		71,587
Property, plant and equipment		17,305		18,353		153
Other assets:
Deferred insurance acquisition costs		520,571		530,231		4,419
Other		45,645		52,282		435
		566,216		582,513		4,854
Total assets	¥	10,089,850	¥	10,485,158	$	87,376

LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings	¥	6,351	¥	194,247	$	1,619
Deposits from customers in the banking business		1,872,965		1,790,920		14,924
Other		199,098		207,219		1,727
		2,078,414		2,192,386		18,270

Long-term debt		44,460		54,542		455
Future insurance policy benefits and other		4,122,372		4,316,443		35,970
Policyholders’ account in the life insurance business		2,259,514		2,308,890		19,241
Other		335,964		332,557		2,770
Total liabilities		8,840,724		9,204,818		76,706

Equity:
Stockholders’ equity of Financial Services		1,247,840		1,279,036		10,659
Noncontrolling interests		1,286		1,304		11
Total equity		1,249,126		1,280,340		10,670
Total liabilities and equity	¥	10,089,850	¥	10,485,158	$	87,376

F-13

	(Millions of yen, millions of U.S. dollars)
Sony without Financial Services	March 31		September 30
	2015		2015		2015
ASSETS
Current assets:
Cash and cash equivalents	¥	741,886	¥	752,223	$	6,269
Marketable securities		3,307		3,252		28
Notes and accounts receivable, trade		893,847		1,001,500		8,346
Other		1,272,562		1,660,491		13,836
		2,911,602		3,417,466		28,479

Film costs		305,232		384,676		3,206
Investments and advances		395,189		299,590		2,497
Investments in Financial Services, at cost		111,476		111,476		929
Property, plant and equipment		720,694		795,933		6,633
Other assets		1,497,805		1,533,433		12,777
Total assets	¥	5,941,998	¥	6,542,574	$	54,521

LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings	¥	215,175	¥	228,340	$	1,903
Notes and accounts payable, trade		622,215		881,130		7,343
Other		1,832,085		1,818,399		15,153
		2,669,475		2,927,869		24,399

Long-term debt		671,104		715,596		5,963
Accrued pension and severance costs		274,220		271,882		2,266
Other		478,704		470,187		3,918
Total liabilities		4,093,503		4,385,534		36,546

Redeemable noncontrolling interest		5,248		7,475		62

Equity:
Stockholders’ equity of Sony without Financial Services		1,733,233		2,041,784		17,015
Noncontrolling interests		110,014		107,781		898
Total equity		1,843,247		2,149,565		17,913
Total liabilities and equity	¥	5,941,998	¥	6,542,574	$	54,521

	(Millions of yen, millions of U.S. dollars)
Consolidated	March 31		September 30
	2015		2015		2015
ASSETS
Current assets:
Cash and cash equivalents	¥	949,413	¥	1,010,120	$	8,418
Marketable securities		936,731		889,623		7,414
Notes and accounts receivable, trade		899,902		1,008,684		8,405
Other		1,411,855		1,800,767		15,006
		4,197,901		4,709,194		39,243

Film costs		305,232		384,676		3,206
Investments and advances		8,531,353		8,809,247		73,410
Property, plant and equipment		739,285		815,572		6,796
Other assets:
Deferred insurance acquisition costs		520,571		530,231		4,419
Other		1,539,989		1,582,258		13,186
		2,060,560		2,112,489		17,605
Total assets	¥	15,834,331	¥	16,831,178	$	140,260

LIABILITIES AND EQUITY
Current liabilities:
Short-term borrowings	¥	221,525	¥	422,587	$	3,521
Notes and accounts payable, trade		622,215		881,130		7,343
Deposits from customers in the banking business		1,872,965		1,790,920		14,924
Other		2,028,885		2,023,533		16,863
		4,745,590		5,118,170		42,651

Long-term debt		712,087		766,675		6,389
Accrued pension and severance costs		298,753		297,205		2,477
Future insurance policy benefits and other		4,122,372		4,316,443		35,970
Policyholders’ account in the life insurance business		2,259,514		2,308,890		19,241
Other		762,298		750,318		6,253
Total liabilities		12,900,614		13,557,701		112,981

Redeemable noncontrolling interest		5,248		7,475		62

Equity:
Sony Corporation’s stockholders’ equity		2,317,077		2,644,347		22,036
Noncontrolling interests		611,392		621,655		5,181
Total equity		2,928,469		3,266,002		27,217
Total liabilities and equity	¥	15,834,331	¥	16,831,178	$	140,260

F-14

Condensed Statements of Income
	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Financial Services	2014			2015			Change			2015

Financial services revenue	¥	269,576		¥	210,732			-21.8	%	$	1,756
Financial services expenses		222,224			168,775			-24.1			1,406
Equity in net income (loss) of affiliated companies		334			(782	)		–			(7	)
Operating income		47,686			41,175			-13.7			343
Other income (expenses), net		–			–			–			–
Income before income taxes		47,686			41,175			-13.7			343
Income taxes and other		14,786			12,199			-17.5			102
Net income of Financial Services	¥	32,900		¥	28,976			-11.9	%	$	241



	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Sony without Financial Services	2014			2015			Change			2015

Net sales and operating revenue	¥	1,634,224		¥	1,685,275			+3.1	%	$	14,044
Costs and expenses		1,716,280			1,640,158			-4.4			13,669
Equity in net income of affiliated companies		295			1,725			+484.7			15
Operating income (loss)		(81,761	)		46,842			–			390
Other income (expenses), net		(4,366	)		(15,824	)		–			(132	)
Income (loss) before income taxes		(86,127	)		31,018			–			258
Income taxes and other		18,069			14,829			-17.9			123
Net income (loss) of Sony without Financial Services	¥	(104,196	)	¥	16,189			–	%	$	135



	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
Consolidated	2014			2015			Change			2015

Financial services revenue	¥	268,192		¥	209,035			-22.1	%	$	1,742
Net sales and operating revenue		1,633,319			1,683,705			+3.1			14,031
		1,901,511			1,892,740			-0.5			15,773
Costs and expenses		1,987,728			1,805,665			-9.2			15,048
Equity in net income of affiliated companies		629			943			+49.9			8
Operating income (loss)		(85,588	)		88,018			–			733
Other income (expenses), net		(4,367	)		(15,824	)		–			(131	)
Income (loss) before income taxes		(89,955	)		72,194			–			602
Income taxes and other		46,014			38,641			-16.0			322
Net income (loss) attributable to Sony Corporation's stockholders	¥	(135,969	)	¥	33,553			–	%	$	280

F-15

Condensed Statements of Income
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Financial Services	2014			2015			Change			2015

Financial services revenue	¥	516,543		¥	490,118			-5.1	%	$	4,084
Financial services expenses		425,141			402,511			-5.3			3,354
Equity in net income (loss) of affiliated companies		56			(460	)	–				(4	)
Operating income		91,458			87,147			-4.7			726
Other income (expenses), net	–			–			–			–
Income before income taxes		91,458			87,147			-4.7			726
Income taxes and other		28,637			26,059			-9.0			217
Net income of Financial Services	¥	62,821		¥	61,088			-2.8	%	$	509



	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Sony without Financial Services	2014			2015			Change			2015

Net sales and operating revenue	¥	3,199,509		¥	3,216,252			+0.5	%	$	26,802
Costs and expenses		3,259,003			3,120,306			-4.3			26,002
Equity in net income of affiliated companies		3,774			1,826			-51.6			15
Operating income (loss)		(55,720	)		97,772		–				815
Other income (expenses), net		2,027			36,424			+1,696.9			303
Income (loss) before income taxes		(53,693	)		134,196		–				1,118
Income taxes and other		33,817			44,415			+31.3			370
Net income (loss) of Sony without Financial Services	¥	(87,510	)	¥	89,781		–		%	$	748



	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Consolidated	2014			2015			Change			2015

Financial services revenue	¥	513,942		¥	486,724			-5.3	%	$	4,056
Net sales and operating revenue		3,197,477			3,214,075			+0.5			26,784
		3,711,419			3,700,799			-0.3			30,840
Costs and expenses		3,731,023			3,517,240			-5.7			29,310
Equity in net income of affiliated companies		3,830			1,366			-64.3			11
Operating income (loss)		(15,774	)		184,925		–				1,541
Other income (expenses), net		(5,804	)		25,979		–				217
Income (loss) before income taxes		(21,578	)		210,904		–				1,758
Income taxes and other		87,583			94,910			+8.4			791
Net income (loss) attributable to Sony Corporation’s stockholders	¥	(109,161	)	¥	115,994		–		%	$	967

F-16

Condensed Statements of Cash Flows
	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Financial Services	2014			2015			2015

Net cash provided by operating activities	¥	222,115		¥	247,888		$	2,066
Net cash used in investing activities		(282,765	)		(363,535	)		(3,029	)
Net cash provided by (used in) financing activities		(25,488	)		166,017			1,383
Net increase (decrease) in cash and cash equivalents		(86,138	)		50,370			420
Cash and cash equivalents at beginning of the fiscal year		240,332			207,527			1,729
Cash and cash equivalents at end of the period	¥	154,194		¥	257,897		$	2,149


	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Sony without Financial Services	2014			2015			2015

Net cash used in operating activities	¥	(110,210	)	¥	(211,895	)	$	(1,766	)
Net cash used in investing activities		(94	)		(93,536	)		(779	)
Net cash provided by (used in) financing activities		(255,359	)		324,837			2,707
Effect of exchange rate changes on cash and cash equivalents		15,844			(9,069	)		(76	)
Net increase (decrease) in cash and cash equivalents		(349,819	)		10,337			86
Cash and cash equivalents at beginning of the fiscal year		806,134			741,886			6,183
Cash and cash equivalents at end of the period	¥	456,315		¥	752,223		$	6,269


	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
Consolidated	2014			2015			2015

Net cash provided by operating activities	¥	104,075		¥	25,541		$	213
Net cash used in investing activities		(282,859	)		(457,072	)		(3,809	)
Net cash provided by (used in) financing activities		(273,017	)		501,307			4,178
Effect of exchange rate changes on cash and cash equivalents		15,844			(9,069	)		(76	)
Net increase (decrease) in cash and cash equivalents		(435,957	)		60,707			506
Cash and cash equivalents at beginning of the fiscal year		1,046,466			949,413			7,912
Cash and cash equivalents at end of the period	¥	610,509		¥	1,010,120		$	8,418

F-17

(Notes)

1.	U.S. dollar amounts have been translated from yen, for convenience only, at the rate of ¥120 = U.S. $1, the approximate Tokyo foreign exchange market rate as of September 30, 2015.

2.	As of September 30, 2015, Sony had 1,292 consolidated subsidiaries (including variable interest entities) and 104 affiliated companies accounted for under the equity method.

3.	The weighted-average number of outstanding shares used for the computation of earnings per share of common stock is as follows:

Weighted-average number of outstanding shares	(Thousands of shares)
	Three months ended September 30
Net income (loss) attributable to Sony Corporation’s stockholders	2014	2015
— Basic	1,093,725	1,259,567
— Diluted	1,093,725	1,285,541

Weighted-average number of outstanding shares	(Thousands of shares)
	Six months ended September 30
Net income (loss) attributable to Sony Corporation’s stockholders	2014	2015
— Basic	1,068,703	1,214,268
— Diluted	1,068,703	1,228,680

All potential shares were excluded as anti-dilutive for the three and six months ended September 30, 2014 due to Sony incurring a net loss attributable to Sony Corporation’s stockholders. The dilutive effect in the weighted-average number of outstanding shares for the three and six months ended September 30, 2015 primarily resulted from convertible bonds which were issued in July 2015.

4.	Recently adopted accounting pronouncements:

Reporting discontinued operations and disclosures of disposals of components of an entity

In April 2014, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance that changes the requirements for reporting discontinued operations and requires additional disclosures about discontinued operations. Under the new guidance, only disposals representing a strategic shift in operations that has, or will have, a major effect on the entity’s operations and financial results should be presented as discontinued operations. Additionally, the revised guidance requires additional disclosures for discontinued operations as well as for disposals of significant components of an entity that do not qualify for discontinued operations presentation. This guidance was effective for Sony as of April 1, 2015. The adoption of this guidance did not have a material impact on Sony’s results of operations and financial position.

Repurchase-to-maturity transactions and repurchase financings

In June 2014, the FASB issued new accounting guidance for the accounting and disclosure of repurchase-to-maturity transactions and repurchase financings. The guidance requires that repurchase-to-maturity transactions be accounted for as secured borrowings, and requires that a transfer of a financial asset and a repurchase agreement executed contemporaneously be accounted for separately. The guidance also requires additional disclosures about certain transferred financial assets accounted for as sales and certain transactions accounted for as secured borrowings. Except for the disclosure for transactions accounted for as secured borrowings, the guidance was effective for Sony as of January 1, 2015. The guidance for disclosure for transactions accounted for as secured borrowings was effective for Sony as of April 1, 2015. The adoption of this guidance did not have a material impact on Sony’s result of operations and financial position.

Sony realigned its business segments for the first quarter of the fiscal year ending March 31, 2016 to reflect modifications to its organizational structure as of April 1, 2015, primarily repositioning certain operations, which were in All Other and the Devices segment. In connection with this realignment, the operations of Sony’s disc manufacturing business in Japan, which were included in All Other are now included in the Music segment and the operations of So-net Corporation and its subsidiaries, which were included in All Other are now included in the MC segment. Certain operations regarding pre-installed automotive audio products which were included in the Devices segment are now included in the HE&S segment. For further details of current segments and categories, see page F-8 and F-9. In connection with this realignment, the sales and operating revenue and operating income (loss) of each segment for the comparable period have been reclassified to conform to the current presentation.

F-18

Sony estimates the annual effective tax rate ("ETR") derived from a projected annual net income before taxes and calculates the interim period income tax provision based on the year-to-date income tax provision computed by applying the ETR to the year-to-date net income before taxes at the end of each interim period. The income tax provision based on the ETR reflects anticipated income tax credits and net operating loss carryforwards; however, it excludes the income tax provision related to significant unusual or extraordinary transactions. Such income tax provision is separately reported from the provision based on the ETR in the interim period in which it occurs.

7.	Certain reclassifications of the financial statements and accompanying footnotes for the three and six months ended September 30, 2014 have been made to conform to the presentation for the three and six months ended September 30, 2015.

Other Consolidated Financial Data

	(Millions of yen, millions of U.S. dollars)
	Three months ended September 30
	2014			2015			2015
Capital expenditures*	¥	57,393		¥	115,841		$	965
(Additions to property, plant and equipment)		(39,199	)		(98,580	)		(821	)
(Additions to intangible assets)		(18,194	)		(17,261	)		(144	)
Depreciation and amortization expenses**		82,449			97,034			809
(Depreciation expenses for property, plant and equipment)		(39,411	)		(44,455	)		(371	)
(Amortization expenses for intangible assets)		(43,038	)		(52,579	)		(438	)
Research and development expenses		115,080			114,269			952

	(Millions of yen, millions of U.S. dollars)
	Six months ended September 30
	2014			2015			2015
Capital expenditures*	¥	112,621		¥	209,602		$	1,747
(Additions to property, plant and equipment)		(76,326	)		(176,065	)		(1,467	)
(Additions to intangible assets)		(36,295	)		(33,537	)		(280	)
Depreciation and amortization expenses**		166,747			184,055			1,534
(Depreciation expenses for property, plant and equipment)		(77,985	)		(86,386	)		(720	)
(Amortization expenses for intangible assets)		(88,762	)		(97,669	)		(814	)
Research and development expenses		222,006			225,580			1,880

*	Excluding additions for tangible and intangible assets from business combinations.
**	Including amortization expenses for deferred insurance acquisition costs.

F-19