索尼 (SONY) 2023 Q1 法說會逐字稿

Now it's time to start Sony Group Incorporated (sic) [Sony Group Corporation] consolidated announcement. My name is [Okada] from PR, and I'll be facilitator for this meeting.

現在是時候開始 Sony Group Incorporated (sic) [Sony Group Corporation] 合併公告了。我是 PR 的 [Okada]，我將擔任這次會議的主持人。

I'd like to first ask Mr. Totoki, Executive Deputy President and Chief Financial Officer, Senior Vice President, who'll be giving the presentation about our projections for the rest of the year and the result of first quarter of 2022. We are planning to finish this in about -- and with that, Totoki-san, we will...

我想先問問執行副總裁兼首席財務官、高級副總裁 Totoki 先生，他將介紹我們對今年剩餘時間的預測以及 2022 年第一季度的結果。我們是計劃在大約 - 之後完成這個，Totoki-san，我們將......

Thank you very much. I would -- now, I'll start with discussing business environment around our company.

非常感謝。我會 - 現在，我將從討論我們公司周圍的商業環境開始。

The forecast announced in May was based on growth outlook of the global economy as of January as well as major risks at the time of forecasting such as direct impact from the situation in Ukraine and the impact of COVID-19 in China. Business environment had changed significantly since then, and there are concerns about more slowdown of global economy primarily due to rapid inflation as well as responding monetary policy by different countries.

5 月宣布的預測基於截至 1 月的全球經濟增長前景以及預測時的主要風險，例如烏克蘭局勢的直接影響和 COVID-19 對中國的影響。自那時以來，商業環境發生了顯著變化，人們擔心全球經濟進一步放緩主要是由於快速通脹以及各國應對貨幣政策的影響。

We are working to assess the impact from those environmental changes and will take prompt actions to address them as a top priority in managing our business. And the forecast we disclosed today incorporates those impact to a reasonable degree based on current circumstances.

我們正在努力評估這些環境變化的影響，並將迅速採取行動將其作為管理業務的重中之重。我們今天披露的預測根據當前情況在合理程度上包含了這些影響。

ET&S and I&SS are highly sensitive to changes in macro environment, but we are also paying close attention to all other segments, including G&NS, Music, Picture and Financial Services, and we are taking a step to mitigate risks in managing our business.

ET&S 和 I&SS 對宏觀環境的變化高度敏感，但我們也密切關注所有其他領域，包括 G&NS、音樂、圖片和金融服務，我們正在採取措施降低管理業務的風險。

Now I will explain the following topics.

現在我將解釋以下主題。

FY '22 Q1 consolidated sales increased 2% year-on-year to JPY 2,311.5 billion, and consolidated operating income increased JPY 26.9 billion to JPY 307 billion, both of which were a record high for the first quarter. Income before tax increased JPY 8.2 billion year-on-year to JPY 291.4 billion, and net income attributable to Sony Corporation -- Sony Group Corporation shareholders increased JPY 6.4 billion to JPY 218.2 billion. Consolidated operating cash flow excluding the Financial Services saw an outflow of JPY 167.4 billion primarily driven by increase in working capital and the impact from currency adjustment due to a weaker Japanese yen.

FY '22 Q1 合併銷售額同比增長 2% 至 23,115 億日元，合併營業收入增長 269 億日元至 3,070 億日元，均為第一季度的歷史新高。稅前收入同比增加82億日元至2914億日元，歸屬於索尼公司-索尼集團股東的淨利潤增加64億日元至2182億日元。不包括金融服務的合併經營現金流流出 1,674 億日元，主要是由於營運資金增加和日元疲軟導致的貨幣調整的影響。

The slide show results by segment of FY '22 Q1. Now I will explain FY '22 consolidated results forecast.

按 FY '22 Q1 細分的幻燈片顯示結果。現在我將解釋 FY '22 綜合結果預測。

Consolidated sales are expected to be JPY 1,500 billion (sic) [JPY 11,500 billion], JPY 100 billion lower (sic) [higher] than the previous forecast. And operating income business is expected to be JPY 1,110 billion, JPY 50 billion lower than the forecast.

合併銷售額預計為 15000 億日元（原文如此）[115000 億日元]，比之前的預測低 1000 億日元（原文如此）[高]。而營業收入業務預計為11100億日元，比預期低500億日元。

Q1 operating profit was higher than the forecast, but in order to cover uncertainties in business environment from a second quarter and onward, we decided to maintain full year operating income forecast as announced in May for the 5 segment except G&NS, where we have revised our view for general gaming market.

第一季度營業利潤高於預期，但為了應對第二季度及以後商業環境的不確定性，我們決定維持 5 月份公佈的除 G&NS 以外的 5 分部的全年營業收入預測，我們已修改了我們的對一般遊戲市場的看法。

Consolidated operating cash flow excluding Financial Services is expected at JPY 820 billion, JPY 230 billion lower than the previous forecast to reflect actual result in Q1.

不包括金融服務的合併經營現金流預計為 8,200 億日元，比之前的預測低 2,300 億日元，以反映第一季度的實際結果。

The assumed foreign currency rates have been updated to approximately JPY 130 to the U.S. dollars and approximately JPY 130 (sic) [JPY 138] to euro.

假定的外幣匯率已更新為對美元約 130 日元和對歐元約 130 日元（原文如此）[JPY 138]。

This slide show our forecast by segment for FY '22. I'll now explain the situation in each of our business segments.

這張幻燈片顯示了我們對 22 財年的細分預測。我現在將解釋我們每個業務部門的情況。

First one is G&NS segment. FY '22 Q1 sales decreased 2% year-on-year to JPY 604.1 billion primarily due to a decrease in software sales, including add-on content, partially offset by favorable impact from foreign exchange rates.

第一個是 G&NS 部分。 22 財年第一季度銷售額同比下降 2% 至 6,041 億日元，主要是由於軟件銷售額（包括附加內容）的減少，部分被外匯匯率的有利影響所抵消。

Operating income decreased significantly by JPY 30.5 billion year-on-year to JPY 52.8 billion primarily driven by decrease in software sales and increase in gaming software development costs.

營業收入同比大幅下降 305 億日元至 528 億日元，主要是由於軟件銷售減少和遊戲軟件開發成本增加所致。

Despite an upside of bigger sales due to currency, FY '22 sales are expected to decrease by JPY 40 billion from previous forecast to JPY 3,620 billion primarily due to revised forecast of software sales for the year, reflecting the result of Q1.

儘管由於貨幣的原因銷售額增加，但 22 財年的銷售額預計將從之前的預測減少 400 億日元至 36,200 億日元，這主要是由於對今年軟件銷售額的預測進行了修訂，這反映了第一季度的結果。

Because of the factors such as decrease in software sales and negative impact of foreign exchange rates, together with the earlier-than-expected closure of Bungie acquisition resulted in JPY 13 billion additional for transaction for the year, FY '22 operating income is expected to decrease by JPY 50 billion from our previous forecast at JPY 255 billion.

由於軟件銷售下降和匯率的負面影響等因素，加上Bungie收購的提前結束導致本年度交易增加130億日元，預計22財年營業收入將比我們之前預測的 2,550 億日元減少 500 億日元。

PlayStation users' total gameplay time declined 15% year-on-year in quarter 1. Gameplay time in June improved 3% compared with May and was down only 10% versus June 2021. But this is a much lower engagement level than we anticipated in our previous forecast.

PlayStation 用戶的總遊戲時間在第一季度同比下降了 15%。6 月份的遊戲時間與 5 月相比增加了 3%，與 2021 年 6 月相比僅下降了 10%。但這比我們在我們之前的預測。

We believe the main reason for this is that the growth of the overall game market has recently decelerated as opportunities have increased -- have -- opportunities have increased for users to get out of home as COVID-19 infections have subsided in key markets.

我們認為，主要原因是整體遊戲市場的增長最近放緩，因為隨著關鍵市場 COVID-19 感染的消退，用戶出門在外的機會增加了。

With this in mind, we intend to take action to increase user engagement in the second half of the fiscal year, during which major titles, including first-party software, are scheduled to be released primarily by increasing the supply of PlayStation 5 hardware and promoting the new PlayStation Plus services. For now, we have made no change to our 18 million unit sales forecast for PS5 hardware in FY '22. But since we are seeing a recovery from the impact of the lockdown in Shanghai and a significant improvement in the component supply, we are working to bring forward more supply in the end (sic) [year-end] holiday selling season.

考慮到這一點，我們打算在本財年下半年採取行動提高用戶參與度，在此期間主要通過增加 PlayStation 5 硬件的供應和推廣包括第一方軟件在內的主要遊戲計劃發布新的 PlayStation Plus 服務。目前，我們對 22 財年 PS5 硬件的 1800 萬台銷量預測沒有任何變化。但是，由於我們看到上海封鎖的影響正在復蘇，並且零部件供應有了顯著改善，我們正在努力在年底（原文如此）[年終]假日銷售季節增加供應。

Sony Interactive Entertainment completed its acquisition of Bungie on July 15 of this year, and the collaboration between the 2 companies have begun. In addition, the acquisition of Haven Entertainment Studios announced in March was completed in June 27. In addition to the content development capability enhancement at our existing studios, we are working to strengthen our first-party software by creating new IP and accelerating the rollout of the live game services and multi-platform titles through synergies with the studios we've acquired.

索尼互動娛樂於今年 7 月 15 日完成了對 Bungie 的收購，兩家公司之間的合作已經開始。此外，3 月份宣布的對 Haven Entertainment Studios 的收購已於 6 月 27 日完成。除了增強我們現有工作室的內容開發能力外，我們正在努力通過創建新 IP 和加速推出來加強我們的第一方軟件。通過與我們收購的工作室的協同作用，提供現場遊戲服務和多平台遊戲。

Next is the Music segment. Q1 sales increased a significant 21% year-on-year to JPY 308.1 billion primarily due to the ForEx rate impact and the streaming revenue increase.

接下來是音樂部分。第一季度銷售額同比大幅增長 21% 至 3081 億日元，這主要是由於外匯匯率的影響和流媒體收入的增加。

Operating income increased JPY 5.6 billion year-on-year to JPY 61.0 billion primarily due to the positive impact from exchange rate. The contribution to operating income from digital media (sic) [Visual Media] and Platform accounted for slightly more than 10% of the segment operating income for the quarter.

營業收入同比增長 56 億日元至 610 億日元，主要是由於匯率的積極影響。數字媒體（原文如此）[視覺媒體]和平台對營業收入的貢獻佔該季度分部營業收入的10%以上。

FY '22 sales are expected to increase JPY 40 billion from our previous focus to JPY 1,220 billion (sic) [JPY 1,280 billion] mainly due to the ForEx impact.

22 財年的銷售額預計將從我們之前的重點增加 400 億日元至 12,200 億日元（原文如此）[12,800 億日元]，這主要是由於外匯影響。

The operating income forecast is unchanged from our previous forecast.

營業收入預測與我們之前的預測相同。

Q1 streaming revenue continued to grow with revenue -- Recorded Music growing 27% and Music Publishing growing 42% year-on-year; 8% and 20%, respectively, on a U.S. dollar basis.

Q1 流媒體收入持續增長——Recorded Music 同比增長 27%，Music Publishing 同比增長 42%；按美元計算分別為 8% 和 20%。

We are monitoring the impact of the global economic slowdown on streaming services. But we have not changed our view that the global music market, including both Recorded Music and Music Publishing, will grow steadily over the next several years at a growth rate in the high single digit.

我們正在監測全球經濟放緩對流媒體服務的影響。但我們並沒有改變我們的觀點，即包括唱片音樂和音樂出版在內的全球音樂市場將在未來幾年以高個位數的增長率穩步增長。

In Recorded Music, we are producing many hits such as Harry Styles' album, Harry's House, which has become a huge hit worldwide. As a result, we averaged 47 songs in Spotify's weekly global top 100 songs for the quarter, a significant increase from the average 36 songs we recorded last fiscal year.

在 Recorded Music 中，我們製作了許多熱門歌曲，例如 Harry Styles 的專輯《Harry's House》，該專輯已在全球範圍內大獲成功。因此，我們在本季度 Spotify 每周全球前 100 首歌曲中平均有 47 首歌曲，比上一財年我們錄製的平均 36 首歌曲有顯著增加。

In addition to strengthening our ability to continue to generate hits, we are working to expand and diversify our profitability foundation by enhancing artist services through The Orchard and AWAL, expanding our business in emerging markets and collaborating with business partners in new areas such as social and gaming.

除了加強我們繼續創造熱門歌曲的能力外，我們還通過 The Orchard 和 AWAL 加強藝人服務，擴大我們在新興市場的業務，並在社交和賭博。

Next is the Pictures segment. FY '22 Q1 sales increased a significant 67% year-on-year to JPY 341.4 billion primarily due to the foreign exchange rate impact, an increase in the delivery in Television Productions and a revenue increase from films released in the previous fiscal year in Motion Pictures.

接下來是圖片部分。 22 財年第一季度銷售額同比大幅增長 67% 至 3414 億日元，這主要是由於匯率影響、電視製作的交付增加以及上一財年 Motion 發行的電影收入增加圖片。

Operating income increased a significant JPY 25.3 billion year-on-year to JPY 50.7 billion due to increase in the overall sales of the segment.

由於該部門的整體銷售額增加，營業收入同比大幅增加 253 億日元至 507 億日元。

FY '22 sales are expected to increase JPY 50 billion compared to our previous forecast to JPY 1,380 billion primarily due to foreign exchange rate. The forecast for operating income is unchanged from the previous forecast.

與我們之前的預測相比，22 財年的銷售額預計將增加 500 億日元，達到 13,800 億日元，這主要是由於匯率影響。營業收入的預測與之前的預測相同。

Theatrical revenue in the U.S. appears to be -- to recover -- to be recovering with box office revenue in some weeks exceeding 2019 levels, thanks not only to the large-scale films aimed at young audiences but also hits in the family genre, where it was believed COVID-19 would make it difficult to attract audience. We are looking forward to the movie Bullet Train, starring Brad Pitt, to be released in August in the U.S.

美國的影院收入似乎正在復蘇，票房收入將在幾週內超過 2019 年的水平，這不僅要歸功於針對年輕觀眾的大型電影，而且還有家庭類型的熱門電影，其中人們認為 COVID-19 會使吸引觀眾變得困難。我們期待著布拉德皮特主演的電影《子彈列車》將於 8 月在美國上映。

Demand for premium content continued to be strong due to increased competition between -- amongst the video distribution services. As an independent major studio that provides product to a variety of partners, we see this as an opportunity.

由於視頻分發服務之間的競爭加劇，對優質內容的需求持續強勁。作為一家為各種合作夥伴提供產品的獨立大型工作室，我們認為這是一個機會。

In addition to Media Networks, the service integration between Crunchyroll and animation distribution business Funimation is proceeding smoothly, and the number of paying subscribers and business financial performance are growing at a pace that exceeds our expectation.

除了 Media Networks，Crunchyroll 與動漫發行業務 Funimation 的服務整合進展順利，付費用戶數量和業務財務表現都以超出我們預期的速度增長。

Next is the Entertainment, Technology & Services segment. FY '22 Q1 sales decreased 4% year-on-year to JPY 552.3 billion mainly due to a decrease in television unit sales resulting from the impact of lockdown in Shanghai and worsening market conditions, partially offset the favorable ForEx impact.

接下來是娛樂、技術和服務部門。 22 財年第一季度銷售額同比下降 4% 至 5,523 億日元，主要是由於上海封鎖和市場狀況惡化導致電視單位銷售額下降，部分抵消了有利的外匯影響。

Operating income decreased JPY 18.2 billion year-on-year to JPY 53.6 billion mainly due to the impact of the decrease in television sales.

營業收入同比減少 182 億日元至 536 億日元，主要是由於電視銷售額下降的影響。

FY '22 sales are expected to increase JPY 50 billion from our previous forecast to JPY 2,450 billion mainly due to the ForEx impact, partially offset by our incorporating the risk of market deceleration into our forecast for the second half of the fiscal year. The operating income forecast is unchanged from our previous forecast.

22 財年的銷售額預計將從我們之前的預測增加 500 億日元至 24,500 億日元，主要是由於外匯影響，部分被我們將市場減速的風險納入我們對本財年下半年的預測所抵消。營業收入預測與我們之前的預測相同。

Due to a faster-than-expected improvement in the utilization of our manufacturing facility following the Shanghai lockdown and a faster-than-expected improvement in supply constraints for components centered on semiconductors mainly for digital cameras, Q1 operating income significantly exceeded our previous forecast. On the other hand, new risks such as global economic slowdown, especially in Europe, and the adverse effects of the strong dollar on our financial results have recently become apparent. We plan to apply the upside to profit we enjoyed in Q1 to these risks and implement additional measures such as improvements in product mix and cost controls in anticipation of even more risks.

由於上海封城後我們的製造設施利用率的改善快於預期，以及以數碼相機為中心的以半導體為中心的零部件供應限制的改善快於預期，第一季度的營業收入大大超過了我們之前的預測。另一方面，全球尤其是歐洲經濟放緩、美元走強對我們財務業績的不利影響等新風險近期顯現。我們計劃將我們在第一季度享受的利潤的上行空間應用於這些風險，並實施額外的措施，例如改進產品組合和成本控制，以應對更多風險。

The inventory level at the end of June is a little high even when we exclude the increase in valuation of the inventory due to the yen depreciation and the strategic stockpile of parts that we are concerned about procuring. And we plan to adjust that level in preparation for the expected softening of demand in the product market going forward. Moreover, we are steadily promoting the transfer of production across multiple facilities, decentralizing the production of key components and digitalizing and further optimizing our operations. We will continue to strive to maintain and improve our profitability by responding swiftly to market changes.

即使我們排除因日元貶值和我們擔心採購的零件的戰略庫存而導致的庫存估值增加，6 月底的庫存水平還是有點高。我們計劃調整該水平，為未來產品市場預期的需求疲軟做準備。此外，我們正在穩步推進多設施生產轉移，分散關鍵零部件的生產和數字化，進一步優化我們的運營。我們將繼續努力通過迅速響應市場變化來維持和提高我們的盈利能力。

Next is the Imaging & Sensing Solutions segment. Sales for the quarter increased 9% year-on-year to JPY 237.8 billion mainly due to the ForEx impact.

接下來是成像和傳感解決方案部分。本季度銷售額同比增長 9% 至 2,378 億日元，主要受外匯影響。

Operating income decreased JPY 8.8 billion year-on-year to JPY 21.7 billion mainly due to an increase in R&D and depreciation expenses despite the positive ForEx impact.

營業收入同比減少 88 億日元至 217 億日元，這主要是由於研發和折舊費用的增加，儘管受到了積極的外匯影響。

FY '22 sales are expected to decrease JPY 30 billion from the previous forecast to JPY 1,440 billion. The operating income forecast is unchanged from our previous forecast.

22 財年的銷售額預計將從之前的預測減少 300 億日元至 14,400 億日元。營業收入預測與我們之前的預測相同。

Our forecast this time assumes that we cannot expect a recovery in the Chinese smartphone market this fiscal year after considering the trends seen in the Chinese market during Q1, and we have incorporated deceleration of the middle and low-end finished product market as well as lower sales of the mobile imaging sensors -- image sensors to reflect this deceleration.

我們這次的預測假設在考慮到第一季度中國市場的趨勢後，我們不能指望本財年中國智能手機市場出現復甦，並且我們已經將中低端成品市場的減速以及低端市場納入其中。移動成像傳感器——圖像傳感器的銷售反映了這種減速。

On the other hand, in response to growing needs for video recording, the introduction of smartphone manufacturers of our larger die-size, high-resolution image sensors in their high-end lineup is steadily progressing. We believe that this trend towards higher-resolution quality and improved functionality of cameras has become even more apparent.

另一方面，為了應對日益增長的視頻錄製需求，智能手機製造商的高端產品陣容中我們的更大芯片尺寸、高分辨率圖像傳感器的引入正在穩步推進。我們相信，這種向更高分辨率質量和改進相機功能的趨勢變得更加明顯。

From the second quarter onward, we anticipate that the larger die-size sensor adoption of -- by customers will accelerate further and drive sales growth for mobile image sensors. In addition, due to an easing supply and demand equilibrium for logic semiconductors, it has become possible to gradually increase the production of high value-add image sensors, the production of which was previously restricted due to supply constraints. Therefore, we expect that the product mix will gradually improve from the latter half of the fiscal year.

從第二季度開始，我們預計客戶對更大芯片尺寸傳感器的採用將進一步加速，並推動移動圖像傳感器的銷售增長。此外，由於邏輯半導體供需平衡的緩和，可以逐步增加高附加值圖像傳感器的產量，而此前由於供應限制，其產量受到限制。因此，我們預計產品結構將從本財年下半年開始逐步改善。

Moreover, when it comes to automotive image sensors in (sic) [and] our AITRIOS and other solution businesses that are expected to grow significantly over the mid to long term, we will continue to proactively invest in the development of technology and expansion of business themselves.

此外，對於（原文如此）[和]我們的 AITIOS 和其他解決方案業務中預計將在中長期顯著增長的汽車圖像傳感器，我們將繼續積極投資於技術開發和業務擴展他們自己。

Last is the Financial Services segment. FY '22 Q1 Financial Services revenue decreased a significant 28% to JPY 297.8 billion mainly due to a decrease in net gains on investment in the separate accounts at Sony Life Insurance Limited (sic) [Sony Life Insurance Co., Ltd].

最後是金融服務部門。 22 財年第一季度金融服務收入大幅下降 28% 至 2,978 億日元，主要是由於索尼人壽保險有限公司 (sic) [索尼人壽保險有限公司] 的獨立賬戶投資淨收益減少。

Operating income decreased -- increased a significant JPY 57.3 billion year-on-year to JPY 81.3 billion mainly due to the recording of a gain on the sales of real estate completed in April and the absence of a loss recorded in the same quarter of the previous fiscal year from the unauthorized withdrawal of funds both at Sony Life. As Sony Life previously announced, the judicial procedures to recover the funds from the unauthorized withdrawal were completed in July.

營業收入減少——同比大幅增加 573 億日元至 813 億日元，主要是由於 4 月份完成的房地產銷售錄得收益，並且沒有錄得 2019 年同期的虧損索尼人壽未經授權提取資金的上一財年。正如索尼人壽此前宣布的，從未經授權的提款中收回資金的司法程序已於 7 月完成。

The FY '22 Financial Services revenue and operating income forecasts are unchanged from our previous forecasts.

22 財年金融服務收入和營業收入預測與我們之前的預測保持不變。

With the large-scale and rapid changes in the business environment this fiscal year, the risks and issues that need to be addressed are wide-ranging and diverse. In each business, we aim to thoroughly grasp the situation accurately and respond promptly to changes in the business environment. And we plan to continue to operate the business with highest level of caution. At the same time, we will steadily continue our efforts to achieve long-term growth.

隨著本財年營商環境的大規模快速變化，需要應對的風險和問題是廣泛而多樣的。在每項業務中，我們都力求準確把握形勢，及時應對業務環境的變化。我們計劃繼續以最高級別的謹慎經營業務。同時，我們將穩步繼續努力，以實現長期增長。

This concludes my remarks.

我的發言到此結束。

So that was the presentation from Mr. Totoki. It will be followed by this. So we will have a media Q&A from 16:20 and a Q&A for investor and analysts from 16:45. We are scheduled to be covering about 20 minutes for questions. (Operator Instructions)

這就是時時先生的介紹。緊隨其後的是這個。所以我們將從16:20開始進行媒體問答，從16:45開始為投資者和分析師進行問答。我們計劃用大約 20 分鐘的時間來回答問題。 （操作員說明）

Now we'll be starting the Q&A session for media people, so please wait a few more seconds. Thank you.

現在我們將開始媒體人的問答環節，請再等幾秒鐘。謝謝你。

Thank you for waiting. And we now like to start the Q&A session with the media representatives. And to respond to your questions, we have Mr. Hiroki Totoki, Executive Deputy President and CFO; and also Ms. Naomi Matsuoka, Senior Vice President in charge of Corporate Planning and Control, Support for Financial (sic) [Finance] Business and Entertainment Area; and also Mr. Hayakawa, Senior VP in charge of Finance and IR. And we will start the Q&A session. (Operator Instructions)

謝謝你的等待。我們現在想開始與媒體代表的問答環節。為了回答您的問題，我們請來了常務副總裁兼首席財務官 Hiroki Totoki 先生；以及負責企業計劃和控制、支持金融（原文如此）[金融]商業和娛樂領域的高級副總裁 Naomi Matsuoka 女士；以及負責財務和 IR 的高級副總裁 Hayakawa 先生。我們將開始問答環節。 （操作員說明）

We have Mr. [Tetsumi] of Nikkei BP.

我們有Nikkei BP的[Tetsumi]先生。

This is [Tetsumi] from Nikkei newspaper. Can you hear me?

我是日經報紙的[Tetsumi]。你能聽到我嗎？

Yes, we hear you.

是的，我們聽到了。

I would like to understand the gaming business situation. If we look at the materials, the software sales was at about 25% decrease, and this is also the reason why you have reduced the forecast for the year. And maybe the reopening of the markets is the reason. And the growth of the gaming world, maybe, as the -- for the industry as a whole, it's slowing down. So in the midterm, do you think it has already peaked out? So that is my first question.

我想了解遊戲業務的情況。從資料來看，軟件銷售額下降了25%左右，這也是你們下調今年預測的原因。也許市場的重新開放就是原因。遊戲世界的增長，也許，對於整個行業來說，它正在放緩。那麼在中期，你認為它已經見頂了嗎？這是我的第一個問題。

My second question, this is more about the future. When it comes to gaming and semiconductors recently, mainly in the Western markets, there's inflation. And there's also -- there's concerns about recessions. So what is related to your company is the consumer's lifestyle. When it comes to gaming, PS5 and software, there might be impact to the demand. And for the semiconductors, the image sensors. Including the high-end consumers, maybe there's an impact in the market. So I'd like to understand if there's any impacts that you're feeling. And how -- what is the level of the risks that you're feeling for the future? Can you explain those situations to me?

我的第二個問題，這更多是關於未來。最近談到遊戲和半導體，主要是在西方市場，有通貨膨脹。還有 - 對經濟衰退的擔憂。因此，與您的公司相關的是消費者的生活方式。在遊戲、PS5 和軟件方面，需求可能會受到影響。對於半導體，圖像傳感器。包括高端消費者在內，或許會對市場產生影響。所以我想了解您是否感受到任何影響。以及如何 - 您對未來的風險程度如何？你能給我解釋一下這些情況嗎？

Thank you very much for the question. I think you asked me two questions, regarding gaming network services, what's the situation now. And also in the Western markets mainly, there's this concern of a recession, the gaming network services and what is the impact on I&SS as well. So I would like to answer both questions.

非常感謝您的提問。我想你問了我兩個問題，關於遊戲網絡服務，現在情況如何。而且主要在西方市場，也存在對經濟衰退、遊戲網絡服務以及對 I&SS 的影響的擔憂。所以我想回答這兩個問題。

Regarding the gaming market, like you said, the software sales has gone down 25%. There were two factors to this. One is the reopening, apparently. And secondly, I showed you earlier the PlayStation users' gaming time. I talked about the trend. If you look at that, I think it's apparent. And also, compared to the previous fiscal year, the major titles' sales has decreased. The number of titles have gone down. So I believe those are the two major reasons.

關於遊戲市場，就像你說的，軟件銷售額下降了 25%。這有兩個因素。一個是重新開放，顯然。其次，我早些時候向您展示了 PlayStation 用戶的遊戲時間。我談到了趨勢。如果你看這個，我認為它很明顯。而且，與上一財年相比，主要遊戲的銷售額有所下降。標題數量減少了。所以我相信這是兩個主要原因。

The engagement itself for some time for the downwards trend in June, that stopped. And for July, we saw a slight recovery. That's my understanding. So we need to carefully observe the situation around this.

訂婚本身因 6 月份的下降趨勢而停止了一段時間。而對於 7 月，我們看到了輕微的複蘇。這是我的理解。所以我們需要仔細觀察這周圍的情況。

Therefore, the changes in the trend is something that we need to incorporate into our future expectations. And for the mid to long-term growth and trends, for now we don't have any serious concerns and for the game network services and I&SS impact from the economic situation point of view.

因此，趨勢的變化是我們需要納入未來預期的東西。而對於中長期的增長和趨勢，目前我們沒有任何嚴重的擔憂，從經濟形勢的角度來看，對於遊戲網絡服務和 I&SS 的影響。

For PS5 demand, the supply has not been sufficient. So for this, the demand has not gone down. And first of all, we need to really meet the demand. I think that is the important thing to do.

對於 PS5 的需求，供應一直不夠充足。因此，對此，需求並沒有下降。首先，我們需要真正滿足需求。我認為這是最重要的事情。

And also, regarding the image sensors, especially for smartphones and for the high-end smartphones, we would have to see what the sales situation is going to be. In China, the demand is going down. And I don't think in this term, we will be able to see a recovery, and I said that in my presentation. So the mid to low-end products, demand slowdown is actually significant. So for the high-end products from a global perspective, the demand for our image sensors as of now has not gone down. And for now, the demand is quite robust. However, obviously, this depends on the economic trends. But especially in the second half, we would have to look at the global smartphone demand very closely. That's all.

此外，關於圖像傳感器，尤其是智能手機和高端智能手機，我們必須看看銷售情況如何。在中國，需求正在下降。我不認為在這個學期，我們將能夠看到復蘇，我在我的演講中說過。所以中低端產品的需求放緩其實很明顯。所以從全球的角度來看，高端產品對我們的圖像傳感器的需求目前並沒有下降。目前，需求相當強勁。然而，顯然，這取決於經濟趨勢。但尤其是下半年，我們將不得不非常密切地關注全球智能手機的需求。就這樣。

Now I would like to take you to the next question. [Sasaki-san] from [Toyoke] side, please. Hello, [Sasaki-san?]

現在我想帶你回答下一個問題。請[Toyoke]那邊的[Sasaki-san]。你好，【佐佐木同學？】

Hello? Can you hear me?

你好？你能聽到我嗎？

Yes, we hear you.

是的，我們聽到了。

Okay. Very good. I'm [Sasaki] from [Toyoke] side. I have two questions.

好的。很好。我是[Toyoke]那邊的[Sasaki]。我有兩個問題。

First question is again about gaming. Now in first quarter, software sales has decreased, as I understood. And -- but like you said, externality was main driver. But is there any other reasons -- whether from competitors or maybe internally, is there any reasons that dragged down the sales performance of software -- gaming software?

第一個問題又是關於遊戲的。據我了解，現在在第一季度，軟件銷售額有所下降。而且——但就像你說的，外部性是主要驅動力。但是否還有其他原因——無論是來自競爭對手還是內部，是否有任何原因拖累了軟件——遊戲軟件的銷售業績？

The other thing is the progress that you've made, particularly for semiconductors. In the midterm perspective, you have there some concerns about that. And for Pictures, there are certain drivers that can influence on that. Semiconductors also, do you expect some -- like a turnaround and upsides coming in the midterm perspective in semiconductor?

另一件事是你取得的進展，特別是在半導體方面。從中期的角度來看，你對此有一些擔憂。對於圖片而言，某些驅動因素會對其產生影響。半導體也是，你是否期望一些——比如半導體的中期前景出現轉機和上漲？

Thank you for your question.

謝謝你的問題。

First question was on gaming. Is there any other factors that drove down -- slowed down of sales performance in gaming software except externality? That was your first.

第一個問題是關於遊戲的。除了外部性之外，還有其他因素導致遊戲軟件銷售業績放緩嗎？那是你的第一個。

Second question was -- your question was about first quarter progress we made in light with the full year performance, particularly on the (inaudible) or on semiconductor business, as I understood.

第二個問題是 - 你的問題是關於我們根據全年業績取得的第一季度進展，特別是在（聽不清）或半導體業務方面，據我所知。

First question, the factors outside of externality, it goes back to my earlier presentation. Last year, we had big titles, big content being launched. In this financial year, particularly in the first quarter, there's nothing similar. In terms of the magnitude of the size of the content, we are kind of -- we had not as many big titles like before.

第一個問題，外部性之外的因素，這可以追溯到我之前的介紹。去年，我們推出了大標題、大內容。在本財政年度，尤其是第一季度，沒有什麼類似的。就內容的大小而言，我們有點——我們沒有像以前那樣多的大標題。

Now progress for Q1 for I&SS, first quarter -- actual in the first quarter was performing better than our expectation. Because our sales and profit plans were focusing more growth coming from second quarter and afterwards because of customers' trend, the product life cycles of customers. These are the inputs that we took. In that sense, the progress that we made for this first quarter in this financial, I&SS business actually performed quite well in the first quarter.

現在第一季度 I&SS 第一季度的進展——第一季度的實際表現好於我們的預期。因為我們的銷售和利潤計劃關注更多來自第二季度和之後的增長，因為客戶的趨勢，客戶的產品生命週期。這些是我們採用的輸入。從這個意義上說，我們在第一季度在財務、I&SS 業務中取得的進展實際上在第一季度表現得相當不錯。

Let's move to the next question. [Nakasuji-san] from TV Tokyo.

讓我們轉到下一個問題。來自東京電視台的[Nakasuji-san]。

Okay. And once again, my name is [Nakasuji] of TV Tokyo.

好的。再說一遍，我的名字是東京電視台的[Nakasuji]。

Most recently, the depreciation of yen was taking place. All of a sudden today, yen went up. And how -- what's your view on this rapid changes up and down? And also, what's your prospect for this exchange rate?

最近，日元貶值。今天突然間，日元上漲了。以及如何 - 您對這種上下快速變化的看法是什麼？另外，你對這個匯率的前景如何？

And too, most recently, exchange -- ForEx market is changing rapidly. And our response to that is since we also do have some management measures, Hayakawa-san will respond.

最近，交易所——外匯市場也在迅速變化。我們對此的回應是，由於我們也有一些管理措施，早川先生會做出回應。

The impact of exchange rate at the start of the fiscal year for the consolidated operating income other than the Financial Services, gaming and ET&S and I&SS, in these three segments, our sensitivity, the JPY 1 down is JPY 1 billion. And for euro, that's JPY 7 billion difference. As Totoki-san has pointed out, it's moving practically up and down. But the -- to mitigate the risks, we want to make sure we get enough margins. And also, the impact of the ForEx rate is very different depending on the segment. I want to make sure that here we have a robust cost structure. So that's how we try to respond in our operation. That's it.

財政年度開始時匯率對除金融服務、博彩以及 ET&S 和 I&SS 以外的合併營業收入的影響，在這三個領域中，我們的敏感性，下降 1 日元為 10 億日元。而對於歐元來說，相差 70 億日元。正如 Totoki 先生所指出的，它實際上是上下移動的。但是——為了降低風險，我們希望確保我們獲得足夠的利潤。此外，外匯匯率的影響因細分市場而異。我想確保我們有一個穩健的成本結構。因此，這就是我們嘗試在操作中做出響應的方式。而已。

Let us move on to the next question. [Abe-san] from Nikkan Kogyo newspaper.

讓我們繼續下一個問題。 [Abe-san] 來自 Nikkan Kogyo 報紙。

My name is [Abe] from Nikkan Kogyo Newspaper. Can you hear me?

我的名字是日刊工業報的[Abe]。你能聽到我嗎？

Yes, we hear you.

是的，我們聽到了。

I have one question regarding the operating income. You have revised it downwards for the year. Why is that? So game and network service is the main reason why you have done that. Out of that, in this area, what is the biggest factor for this revision? Is it the reduced sale in software titles?

我有一個關於營業收入的問題。你已經向下修訂了這一年。這是為什麼？所以遊戲和網絡服務是你這樣做的主要原因。其中，在這方面，這次修訂的最大因素是什麼？是軟件標題的銷售減少嗎？

Thank you very much for the question.

非常感謝您的提問。

As you have said, for the full year, the downward revision of -- downward revision is because of the G&NS. At the beginning, we made a forecast for software sales. Especially for the first quarter, we were quite confident. But we believe there was this gap in the results. We thought that the reopening would much -- would be much more stronger. But that -- based on the results for the Q2 onwards sales, we have updated the information, and we have made the best estimation for now. That's all.

正如您所說，對於全年而言，向下修正是因為 G&NS。一開始，我們對軟件銷售做了預測。尤其是第一季度，我們很有信心。但我們認為結果中存在這種差距。我們認為重新開放會更加強大。但是——根據第二季度以後的銷售結果，我們已經更新了信息，我們目前已經做出了最好的估計。就這樣。

We'll take it to the next question. [Judikar-san] from Bloomberg, you're next.

我們將把它帶到下一個問題。來自彭博社的 [Judikar-san]，你是下一個。

Yes. I'm [Judikar] from Bloomberg. I can -- I hope you can hear me.

是的。我是來自彭博社的 [Judikar]。我可以——我希望你能聽到我的聲音。

Yes, I can hear you.

是的，我能聽到你的聲音。

Okay. Now a question -- two questions about gaming business.

好的。現在有一個問題——關於遊戲業務的兩個問題。

Software sales have been -- was decreased. You explained about it a few times. But hardware, the PS5 hardware, shipment was not catching with the demand. Do you think that's the reason for lower software demand?

軟件銷售已經——下降了。你解釋了幾次。但硬件、PS5 硬件的出貨量並沒有跟上需求。您認為這是軟件需求下降的原因嗎？

The other thing is about consumer products. Whether the cameras and other, products are getting hit from raw material cost increase, supply chain. And there are currencies. There are a lot of headwinds that are coming. Do you think PS5 also needs to increase its price point? Do you think it needs to be considered?

另一件事是關於消費品。無論是相機還是其他產品，都受到原材料成本增加、供應鏈的衝擊。還有貨幣。有很多逆風即將到來。你認為 PS5 也需要提高價格點嗎？你覺得有必要考慮嗎？

Well, thank you very much for the questions, both of which were about game and network services with regard to your question.

嗯，非常感謝你的問題，關於你的問題，這兩個問題都是關於遊戲和網絡服務的。

So software sales. The -- is -- the PS5, the hardware itself, was not being supplied enough for distribution. Is that the reason? Now hardware supply, we're not meeting expectation of customer. We're not shipping enough volume to cover the demand. We acknowledge that as the fact. We want to address that and improve as soon as possible.

所以軟件銷售。 - 是 - PS5，硬件本身，沒有足夠的供應來分發。是這個原因嗎？現在硬件供應，我們沒有達到客戶的期望。我們的出貨量不足以滿足需求。我們承認這是事實。我們希望盡快解決並改進。

As I hate to repeat myself, there were two big constraints that we are imposed with. One is parts and components availability. The other one is supply chain. The logistical parts and components availability saw for a lot of improvements. Sure, we are very hopeful that this is quite optimistic about that.

我不想重複自己，我們被施加了兩個很大的限制。一是零部件的可用性。另一個是供應鏈。後勤零件和組件的可用性得到了很多改進。當然，我們非常希望這是相當樂觀的。

For supply chain disruption, we actually got quite a hit from first quarter. In the first quarter, hardware volume for sales were quite smaller than what we expected at the beginning of the year. So supply chain disruption is something that we hope to get or completely be addressed. In any case, we would like to take our product a day -- earlier is better. We want to deliver as much as soon as possible. 8 million meant the -- as a target has not been changed, but we are trying to produce them as soon as possible in ready for our holiday season this year.

對於供應鏈中斷，我們實際上從第一季度就受到了很大的打擊。第一季度，硬件銷售量遠低於我們年初的預期。因此，供應鏈中斷是我們希望得到或完全解決的問題。無論如何，我們希望我們的產品一天服用——越早越好。我們希望盡快交付。 800 萬意味著——目標沒有改變，但我們正努力盡快生產它們，為今年的假期做好準備。

Second question was about a potential price increase for PlayStation 5. At this point in time, there is nothing I can tell you, share you anything specific about prices. So please take it as my answer to your question.

第二個問題是關於 PlayStation 5 的潛在價格上漲。目前，我無法告訴你任何關於價格的具體信息。所以請把它作為我對你問題的回答。

Okay. We have limited time, so we'll make the next person the last person to ask question. (Operator Instructions)

好的。我們的時間有限，所以我們會讓下一個人成為最後一個提問的人。 （操作員說明）

Hearing none, I would like to conclude the Q&A session with the media representatives. And the Q&A session for investors and analysts, we will start at 4:41.

沒有聽到，我想結束與媒體代表的問答環節。投資者和分析師的問答環節，我們將在 4:41 開始。

(Break)

（休息）

We will be starting the Q&A session for investors and analysts. There will be a few more seconds.

我們將開始投資者和分析師的問答環節。還有幾秒鐘。

(Break)

（休息）

Thank you very much for your patience. And now we'd like to start the Q&A session for investors and analysts.

非常感謝您的耐心等待。現在我們想開始投資者和分析師的問答環節。

My name is [Shinchi]. I belong to the Financial Department/ IR Group. And on behalf of the Sony holdings group, we have these people responding to your questions. (Operator Instructions). Now we'd like to start the Q&A session. (Operator Instructions)

我的名字是[Shinchi]。我屬於財務部/ IR Group。我們代表索尼控股集團，請這些人回答您的問題。 （操作員說明）。現在我們要開始問答環節。 （操作員說明）

The first, Mr. Ono-san of Morgan Stanley [MEFT], please.

第一位，請摩根士丹利 [MEFT] 的小野先生。

Yes. I am Ono from Morgan Stanley, I have two question. One is about games. The other question is about I&SS.

是的。我是摩根士丹利的小野，我有兩個問題。一是關於遊戲。另一個問題是關於 I&SS。

So first question on gaming is now, PS5 shipment has been -- well, the components parts situation has improved, as you said. But it's -- the supply, it's been slow more so than launch. And the third-party software has been postponed by third-party content creators. But do you think -- and Totoki-san, you earlier talked about how -- you said the volume expectation was maybe too optimistic at the beginning. But do you think software has got the impact because of the supply shortage? Or what about user engagement, too, with the PS? There were a lot of excited users who wants to play with PS5. They got, for the lack of better word, get frustrated and maybe had, if you like, shifted its behavior. So can you talk about your perspective of how consumers are behaving based on that -- for those fact?

所以現在關於遊戲的第一個問題是，PS5 的出貨量已經——嗯，正如你所說，組件的情況有所改善。但它 - 供應，它比發布更慢。而第三方軟件已經被第三方內容創作者推遲了。但是您是否認為 - Totoki 先生，您之前談到瞭如何 - 您說一開始的交易量預期可能過於樂觀。但是您認為軟件是否因為供應短缺而受到影響？或者，PS 的用戶參與度如何？有很多興奮的用戶想要玩 PS5。他們得到了，因為缺乏更好的詞，感到沮喪，如果你願意，他們可能改變了它的行為。那麼，您能否談談您對消費者行為的看法——基於這些事實？

The other thing is about I&SS, especially for the mobile customers. How do you see the risks and the inventory availability for that? You said mid to low end for Chinese market versus the inventory. Like you said there was a concern for the inventory, but you are confident about high end. But I think you talked about a lot of inventories, which are commodity items. So can you talk about risk associated with those -- that situation?

另一件事是關於 I&SS，尤其是對於移動客戶。您如何看待風險和庫存可用性？你說中國市場的中低端與庫存相比。就像您說的那樣，庫存存在問題，但您對高端充滿信心。但我認為你談到了很多庫存，它們是商品。那麼你能談談與那些——那種情況相關的風險嗎？

Well, thank you for the question, -- two question. First question is on games; second question on I&SS.

嗯，謝謝你的問題，-- 兩個問題。第一個問題是關於遊戲的；關於 I&SS 的第二個問題。

Now first question. The supply of PS5 is the slower supply to demand. Is that the reason why users decided to stay away, therefore slowed down the sales of software and -- as a hypothesis. And, well, how do I see it?

現在第一個問題。 PS5的供給是供需較慢的。這就是用戶決定遠離的原因，因此減緩了軟件的銷售，並且——作為一種假設。而且，好吧，我怎麼看？

Well, this is a very difficult question. But for us, the supply of hardware will for sure increase user engagement for sure. Because yes, actually, that's been proven from the data that we are paying attention to. So somebody who are playing with PS5 tends to have very high engagement, which is a very positive sign by itself. But from that perspective, PlayStation 5, if the supply -- more people use the hardware, then positive impact -- well, may expect the positive impact to come quickly. So in that sense, in the second half, the volume of PS5 are going to significantly increase.

嗯，這是一個非常困難的問題。但對我們來說，硬件供應肯定會增加用戶參與度。因為是的，實際上，我們正在關注的數據已經證明了這一點。所以玩 PS5 的人往往有很高的參與度，這本身就是一個非常積極的信號。但從這個角度來看，PlayStation 5，如果供應——更多的人使用硬件，那麼就會產生積極影響——好吧，可以預期積極影響會很快到來。所以從這個意義上說，在下半年，PS5的體積將會顯著增加。

So after the second half, we have our own title. Third-party contents are also being planned for their launches. So after the second quarter, after -- there's a momentum which we can build on to escalate that engagement.

所以下半場之後，我們就有了自己的冠軍頭銜。第三方內容也正在計劃推出。因此，在第二季度之後，我們可以利用這種勢頭來升級這種參與度。

So your question about inventories, let's say -- about this question, initially for image sensor for mobile -- so we are looking at production capacity and the demand forecast, and we are going to be acquiring like strategic inventories. And the inventory is going to be having a higher availability than last year. More recently, in the first quarter, the shipment has slowed down a bit. Inventory right now is trending higher than our expectation, but this is within a reasonable range, looking at the growth projection of -- on our forecast.

所以你關於庫存的問題，讓我們說 - 關於這個問題，最初是針對移動圖像傳感器的 - 所以我們正在研究產能和需求預測，我們將獲得戰略庫存。並且庫存將比去年具有更高的可用性。最近，在第一季度，出貨量有所放緩。目前的庫存趨勢高於我們的預期，但這在合理範圍內，看看我們預測的增長預測。

How do I see moving forward especially? So we are expecting to see -- starting to expand more sales in second quarter. So inventory level is going to lower down. It's going to be coming to the normal level. But for the strategic inventories, we are going to have -- deliberately have additional excessive inventory in 2024, 2023. So for the time being, we expect the inventory level to -- for that -- particular for strategic inventory components, to stay the same.

我如何看待向前發展？因此，我們預計會在第二季度開始擴大銷售額。所以庫存水平會下降。它將恢復到正常水平。但對於戰略庫存，我們將在 2024 年和 2023 年故意增加額外的過多庫存。因此，就目前而言，我們預計庫存水平將——為此——尤其是戰略庫存組件，保持在相同的。

Now I talked about many of the components are commodity parts. Generally speaking, I will stay with that statement. But when the demands change, I think you might be concerned that if the demand slowed down, too much of the inventory may turn around as a risk. But are going to be adjusting the capacity for FY '23. We will be able to flexibly not -- be able to control that based on the reaction from the marketplace.

現在我講的很多元件都是商品零件。一般來說，我會堅持這種說法。但是當需求發生變化時，我想你可能會擔心，如果需求放緩，過多的庫存可能會作為風險出現轉機。但將調整 23 財年的容量。我們將能夠靈活地不 - 能夠根據市場的反應來控制它。

Let us move on to the next question. Hirakawa-san from BofA Securities, please.

讓我們繼續下一個問題。請來自美國銀行證券的平川先生。

This is Hirakawa from BofA Securities. I have two questions.

這是美國銀行證券的平川。我有兩個問題。

First question. Regarding operating income plan, you have made a downward revision. The cash flow -- operating cash flow plan, the downward revision is a negative JPY 230 billion? So that's my first question.

第一個問題。關於營業收入計劃，您進行了向下修正。現金流——經營現金流計劃，向下修正為負2300億日元？所以這是我的第一個問題。

Secondly, for I&SS. In your explanation, you talked about smartphones mainly. On the other hand, when it comes to the operating income plan, due to ForEx impact, JPY 7 billion. So for 3 quarters or so, it's more -- the JPY 30 billion is the impact of ForEx. So the industrial equipment and security cameras, image sensors are things that were not included in your explanation. So those are having a significant position. So I would like to understand that situation.

其次，對於 I&SS。在您的解釋中，您主要談到了智能手機。另一方面，在營業收入計劃方面，由於外匯影響，為 70 億日元。因此，在 3 個季度左右的時間裡，它更多—— 300 億日元是 ForEx 的影響。所以工業設備和安全攝像頭，圖像傳感器是你解釋中沒有包括的東西。因此，它們具有重要地位。所以我想了解這種情況。

And from a housekeeping perspective, if you can give me any operating capacity factor information, that would be helpful.

從內務管理的角度來看，如果您能給我任何運營能力因素信息，那將很有幫助。

Thank you for the question.

感謝你的提問。

Regarding the first question, the downward revision of the operating income and also the cash flow situation, the working capital and the tax, those are the factors. But Hayakawa will be explaining the details.

關於第一個問題，營業收入的下調，還有現金流情況、營運資金和稅收，這些都是因素。但是早川會詳細說明。

Thank you very much for the question.

非常感謝您的提問。

As was explained in the speech, and the performance was also explained, the operating cash flow is a negative. This is also impacting the expectations. The working capital has gone down. And due to the depreciation of the yen, from a cash flow statement perspective, there was an adjustment made due to ForEx. So that is significant.

正如演講中解釋的那樣，也解釋了業績，經營現金流為負數。這也影響了預期。營運資金已經下降。並且由於日元貶值，從現金流量表的角度來看，由於外匯而進行了調整。所以這很重要。

And also, regarding the operating income, it has gone down by JPY 50 billion. And the operating cash flow is JPY 230 billion, and the gap between the two -- regarding the JPY 230 billion negative -- regarding the JPY 50 billion, this is the G&NS downward revision of profits.

此外，營業收入減少了500億日元。而經營現金流為2300億日元，兩者之間的差距——關於負2300億日元——關於500億日元，這就是G&NS利潤的向下修正。

And also for the working capital increase, for this, I&SS and also the increase in inventory for ET&S is significant. And regarding I&SS, as Totoki explained, after 2Q second quarter and ours, the sales is going to be significant especially in the fourth quarter. So the account receivables will increase and inventory will also increase as well. But for this, the operating cash flow will come back from the next fiscal year. So that is why the operating capital is involved.

對於營運資金的增加，I&SS 以及 ET&S 的庫存增加也很重要。至於 I&SS，正如 Totoki 解釋的那樣，在第二季度和我們的第二季度之後，銷售額將非常顯著，尤其是在第四季度。所以應收賬款會增加，庫存也會增加。但為此，經營現金流將從下一個財政年度恢復。因此，這就是涉及運營資本的原因。

For the ForEx calculation, this is quite significant for this fiscal year. The yen has depreciated, and so that is quite significant. And also, as of May -- compared to May, the cash tax payment has gone up. And for Pictures and Television Productions, it has also gone up.

對於外匯計算，這對於本財年來說非常重要。日元貶值了，所以這很重要。而且，截至 5 月 - 與 5 月相比，現金納稅有所增加。對於圖片和電視製作，它也有所上漲。

And also lastly, regarding the adjustments for the ForEx, the operating cash flow portion has gone to the negative side. If you look at the cash flow statement, I think it's clear. But for the so-called balance sheet, for the foreign currencies, it's also being included in the calculation, and we see an offset. For the first quarter results, you see that there's an offset. So from a capital allocation perspective, the operating cash flow looks like a negative. But from a balance sheet perspective, it has come back So I think for the ForEx adjustment, I think that could be said. Thank you.

最後，關於外彙的調整，經營現金流部分已經轉為負數。如果你看一下現金流量表，我認為它很清楚。但是對於所謂的資產負債表，對於外幣，它也被包括在計算中，我們看到了抵消。對於第一季度的結果，您會看到存在抵消。因此，從資本配置的角度來看，經營現金流看起來像是負數。但從資產負債表的角度來看，它已經回來了所以我認為對於外匯調整，我認為可以這麼說。謝謝你。

Thank you very much.

非常感謝。

And as for I&SS, the impact of -- positive impact of ForEx is offset by the profit in the industrial applications and the security cameras. And as I said, that the macroeconomic slowdown risk which I mentioned earlier is a concern that the large customers of ours in this area is in China. And so we are -- we anticipate the risk of a possible slowdown for industrial usage. But this may be somewhat of a conservative response we may have.

至於 I&SS，ForEx 的積極影響被工業應用和安全攝像頭的利潤所抵消。正如我所說，我之前提到的宏觀經濟放緩風險是我們在這一領域的大客戶在中國的擔憂。所以我們 - 我們預計工業使用可能放緩的風險。但這可能是我們可能有的保守反應。

And in terms of a sensors capacity and the actual input, and in the supplement material, there is some information we hope you'll refer to. At the end of this quarter, 142 -- 114,000 slices per month. And also, in terms of input, 124,000 slices per month.

在傳感器容量和實際輸入方面，以及在補充材料中，我們希望您參考一些信息。在本季度末，每月 142 - 114,000 片。而且，在輸入方面，每月 124,000 個切片。

Okay, let us move to Ayada-san of JPMorgan Securities.

好的，讓我們轉向摩根大通證券的綾田先生。

My name is Ayada from JPMorgan.

我是摩根大通的綾田。

I have two questions, general questions, both of which. And the first question is about operation, the cost approach about the operation. So because the demand has quite shifted, right, there was like a -- in your announcement, there were a lot of evidences that demand have shifted. And Totoki-san, you mentioned about very quick, agile response. But after first quarter being closed, is there anything that you want to change versus not change? In terms of operation, can you -- do you mind highlighting changes and not changing operations?

我有兩個問題，一般性問題，兩者都是。第一個問題是關於運營的，關於運營的成本方法。因此，因為需求已經發生了很大變化，對，在你的公告中，有很多證據表明需求已經發生了變化。還有 Totoki 先生，您提到了非常快速、敏捷的反應。但是在第一季度結束後，您有什麼想要改變而不是不改變的地方嗎？在操作方面，您是否介意突出更改而不是更改操作？

And speaking about changing operation, in the first quarter, you saw quite worse -- the cash flows got worse than before the -- so TV, the consumer products. Like would you want to manage the inventory level? And the sensors, there is a downward adjustment, and the production capacity, that was -- if they're not being made, the inventory level is going to quite go up at the end of the period. So again, based on those things, what are the things that you would change versus not change in terms of your operation?

談到改變運營，在第一季度，你看到了更糟糕的情況——現金流比以前更糟糕——所以電視，消費產品。您想管理庫存水平嗎？傳感器，有一個向下的調整，生產能力，也就是說 - 如果不生產，庫存水平將在期末大幅上升。再說一遍，基於這些事情，就您的運營而言，您會改變和不改變的事情是什麼？

Second question is about your -- it's about the full year plans. You have -- yes, I understand midterm adjustment. But just having said that, there are some uncertainties right now. What are the uncertainties, like potential risks. For example, (inaudible) game or the high-end products revenue or sales projections are not changing. Do you see any risks for those businesses at all? Yes. If -- and the unknown risks become materialized, do you have any buffer to be able to cushion that surprises? Is that also part of the numbers that's included in the full year?

第二個問題是關於你的——關於全年計劃。你有——是的，我理解中期調整。但話雖如此，現在還存在一些不確定性。有哪些不確定性，例如潛在風險。例如，（聽不清）遊戲或高端產品的收入或銷售預測沒有變化。您認為這些企業有任何風險嗎？是的。如果 - 並且未知風險成為現實，您是否有任何緩衝能夠緩衝這些意外？這也是全年數字的一部分嗎？

Well, thank you for your question.

嗯，謝謝你的提問。

First question was changes or shifts on demand in a quite substantial one. And your question was what are we going to change and what are we not going to change. Second question was about potential risks for rest of the year. So I will take these two questions.

第一個問題是相當大的需求變化或變化。你的問題是我們要改變什麼，我們不改變什麼。第二個問題是關於今年剩餘時間的潛在風險。所以我會回答這兩個問題。

So first, what are we changing or not changing? In that respect, what we are not changing is a building block for mid-to long-term strategic growth. The investment, therefore. Amount of investment may adjust, but what we are committed to do will not change. We will not change our stance and commit for our investment for the future.

那麼首先，我們改變或不改變什麼？在這方面，我們沒有改變的是中長期戰略增長的基石。因此，投資。投資金額可能會調整，但我們承諾做的事情不會改變。我們不會改變我們的立場，並承諾我們對未來的投資。

What we are changing for this financial year is mostly on how we are using expenses and the control of inventories, I would say.

我想說，本財政年度我們要改變的主要是我們如何使用費用和控制庫存。

Speaking first on expenses. For example, entertainment in overseas businesses. Entertainment industries are now becoming very conservative for recruitment. And so when there were headcount, who are open positions, we will try the -- not the traditional approach, but they will have taken more traditional, conservative approach than traditions. And marketing and sales expenses are also looked at, at not spending them. So operational teams are making sure that they are trying to make improvements with risks in their mind.

先說費用。例如，海外企業的娛樂。娛樂行業現在對招聘變得非常保守。因此，當有空缺職位的人數時，我們將嘗試——不是傳統的方法，但他們將採取比傳統更傳統、更保守的方法。營銷和銷售費用也被關注，而不是花費它們。因此，運營團隊正在確保他們在考慮風險的情況下嘗試進行改進。

Now for inventory control, so on all segments, a huge attention is being given to inventories. Well, gaming network is -- first of all, look, inventory is not a problem because supply is not being able to catch up demand.

現在對於庫存控制，所有細分市場都非常關注庫存。好吧，遊戲網絡是——首先，看，庫存不是問題，因為供應無法趕上需求。

But for ET&S and therefore I&SS, all the segments -- well, the inventory went up. There are three reasons for why the inventory went up. One is currency change, weaker Japanese yen. Therefore, it, on the surface level, looks like bigger inventories because of the value change in currency. And we had a quite a long month of supply shortages. We have to make sure that we have access to material. And also the -- in terms of inventory control, the bigger influence is -- actually comes from parts and components. So normalizing parts and components is something that we are focusing on right now.

但是對於 ET&S 和 I&SS，所有細分市場——嗯，庫存都增加了。庫存上升的三個原因。一是貨幣變化，日元走弱。因此，從表面上看，由於貨幣價值的變化，它看起來像是更大的庫存。我們有相當長的一個月供應短缺。我們必須確保我們可以訪問材料。而且 - 在庫存控制方面，更大的影響是 - 實際上來自零部件。所以標準化零件和組件是我們現在關注的事情。

Inventory for I&SS goes back to my earlier comment actually. In FY '23, we have a plans to capacity expansion. But the question is what timing in which we are going to turning that switch on. That would be a one control mechanism that we will use, right?

I&SS 的庫存實際上可以追溯到我之前的評論。在 23 財年，我們計劃擴大產能。但問題是我們將在什麼時間打開這個開關。那將是我們將使用的一種控制機制，對嗎？

And this next one is related to the second question. Is there any risk with the high-end smartphones? So high-end smartphone, if there is going to be risk and become reality for the high-end smartphone. And so we have these scenarios. If our scenario -- the reality becomes slower than our scenario. If that's the -- if that happens, the timing of the capacity expansion will be adjusted or postponed slightly later. That will be the way to control it.

下一個與第二個問題有關。高端智能手機有風險嗎？所以高端智能手機，如果有風險，高端智能手機成為現實。所以我們有這些場景。如果我們的場景——現實變得比我們的場景慢。如果是這樣——如果發生這種情況，產能擴張的時間將稍晚調整或推遲。這將是控制它的方法。

The other one, risk about holiday seasons, our gaming business. Well, the economy being slowed down, therefore, is having an impact on the gaming business sales performance. I don't think that will be our risk, not from the economic slowdown. And the reopen is probably the bigger reason. So after second quarter, the -- when the big content title comes out, we'll be able to test and see how this is going to perform, and that will be a good indicator for us to assess the holiday season. Thank you.

另一個，關於假期的風險，我們的遊戲業務。因此，經濟放緩正在影響遊戲業務的銷售業績。我不認為這將是我們的風險，而不是來自經濟放緩。重新開放可能是更大的原因。所以在第二季度之後，當大內容標題出現時，我們將能夠測試並看看它的表現如何，這將是我們評估假日季節的一個很好的指標。謝謝你。

Let us move on to the next question, from Mizuho Securities, Nakane-san, please.

讓我們繼續下一個問題，請來自瑞穗證券的中根先生。

Yes. I have two questions.

是的。我有兩個問題。

First of all, for Music and Pictures. Second, those 2 areas, the quarter progress -- performance was better than expected from Pictures and Music. I would like to understand the situation. And up to the second quarter compared to the budget, is it higher or lower? What is the range? And for now, it looks healthy, and there are some continuing factors. So I'd like to understand the situation.

首先，對於音樂和圖片。其次，這兩個領域，本季度的進展——圖片和音樂的表現好於預期。我想了解情況。而截至第二季度的預算與預算相比，是更高還是更低？範圍是多少？就目前而言，它看起來很健康，並且還有一些持續的因素。所以我想了解情況。

And regarding Bungie, you said that the acquisition has been completed and the cost changed from JPY 44 billion to JPY 57 billion. I would like to understand the situation regarding that from next year onwards. And I'd like to understand the business situation and the timing of the consolidation. Can you give us an update, please?

至於Bungie，你說收購已經完成，成本從440億日元變成了570億日元。我想從明年開始了解有關情況。我想了解業務情況和合併的時間。請給我們一個更新好嗎？

Thank you very much for the question.

非常感謝您的提問。

Regarding the situation regarding Music and Pictures. Regarding Music, in the first quarter, it was -- it did very well. And Spider-Man and other titles made a major contribution. For the entertainment area, the profit contribution was very high from that perspective, and dramas have been produced for TV. There were many deliveries made. So this quarter, it performed very well.

關於音樂和圖片的情況。關於音樂，在第一季度，它——它表現得非常好。而蜘蛛俠等遊戲也做出了重大貢獻。在娛樂領域，從這個角度來看，利潤貢獻是非常高的，並且已經製作了電視劇。有很多交付。所以這個季度，它表現得非常好。

And for -- are we seeing a decrease in -- from this point onwards? Are we going to Spider-Man-Verse -- major titles. The Spider-Verse has been postponed to the next term. We have already made that decision. So that would have a negative impact. So that's why it's flat.

從現在開始，我們是否看到了減少？我們要去蜘蛛俠詩篇——主要標題。蜘蛛詩已被推遲到下一學期。我們已經做出了這個決定。所以會產生負面影響。所以這就是為什麼它是平的。

Regarding Music, it's in line. The streaming market is doing very well. It's growing. And our share and margin are both also performing very well.

關於音樂，它是一致的。流媒體市場表現非常好。它正在增長。我們的份額和利潤率也都表現得很好。

And regarding games, so we'll have to look at the situation next year onwards. But regarding the cost for the acquisition, the expense for the FY '23 compared to this year, it will be an increase of about 20% -- by 20%. And also, the Bungie business having an impact on the whole both in terms of revenue and profit, I think it will be minimal.

而關於遊戲，我們將不得不從明年開始看情況。但就收購成本而言，23 財年的費用與今年相比，將增加約 20% - 20%。而且，Bungie 業務在收入和利潤方面對整體的影響，我認為這將是微乎其微的。

We're running out of time, so we will limit only one question from -- per person.

我們的時間不多了，所以我們將限制每個人的一個問題。

And so now, Katsura-san from SMBC Nikko Shoken.

那麼現在，來自 SMBC Nikko Shoken 的 Katsura 先生。

So since I can only ask one question, this is related with the previous question, but there is some -- this is a general question.

所以因為我只能問一個問題，這與上一個問題有關，但有一些——這是一個普遍的問題。

Now compared with year-on-year on the last -- the budget 1Q -- Q1 and full year, there are certain things that you have incorporated versus not incorporated. There were a lot of in and outs, so I'd like to kind of clearly understand them.

現在，與上一季度的上一季度預算 - 第一季度和全年的同比情況相比，有些事情你已經納入而不是沒有納入。有很多進出，所以我想清楚地理解它們。

First of all, Q1. So Shanghai locked down, about JPY 30 billion, right? ET&S is actually doing quite well. Picture's ahead of the plan. And games, no. I&SS is also -- have a slight change. And so there are a lot of changes for upsides. And the Financial services also looks like that. So -- but out of that, the actual like currency, so positive, negative. Also, there were a lot of in and outs, positive and negatives for currency. Can you just summarize like -- so how -- currency actual impact compared with last year?

首先，Q1。所以上海封城了，大概300億日元吧？ ET&S 實際上做得很好。圖片超出了計劃。和遊戲，沒有。 I&SS 也是——略有變化。所以有很多變化。金融服務也是如此。所以 - 但除此之外，實際的貨幣，如此積極，消極。此外，貨幣有很多進出，正面和負面。你能總結一下——那麼如何——與去年相比，貨幣的實際影響？

For the full year, so this is again gaming. Gaming is the only one you have made adjustment. But I&SS also have performed slower a bit. But there are -- if there are any other positives in other businesses, could you -- do you mind making some comments about that?

全年，所以這又是遊戲。遊戲是您唯一進行調整的一項。但 I&SS 的表現也有點慢。但是，如果其他業務有任何其他積極的方面，你能 - 你介意對此發表一些評論嗎？

Okay. So year-on-year and versus last year, there were a lot of things that we have incorporated, not incorporated. And so currency versus last year, let me pick that up as the first discussion point, at the beginning of the year, this financial year, in terms of currency, when we started this planning process, the currency -- ForEx impact were -- we actually incorporate certain changes that could happen. So in Q1, about JPY 30 billion in positive. Positive, so I'm talking about impact for the bottom line. And that's, in the overall -- at high level, that's about the impact that we gained from currency change.

好的。因此，與去年相比，我們已經合併了很多東西，而不是合併。所以貨幣與去年相比，讓我把它作為第一個討論點，在今年年初，這個財政年度，就貨幣而言，當我們開始這個計劃過程時，貨幣——外匯影響是——我們實際上納入了某些可能發生的變化。因此，在第一季度，大約有 300 億日元的正面收益。積極的，所以我說的是對底線的影響。總體而言，這就是我們從貨幣變化中獲得的影響。

The other thing -- so there are changes on the upside and downside. It's kind of complicated to describe. The reason why I say that is what we announced at the beginning of financial year, right -- back then, lockdown in Shanghai was very clearly there. We could see that coming. And geopolitical impacts, we have actually incorporated those -- the geopolitical developments. But global economic slowdown, including China, is something that we didn't really anticipate, incorporate. And that's an environment change that we only saw afterwards. And we have updated them based on those new developments.

另一件事 - 所以有上行和下行的變化。描述起來有點複雜。我這麼說的原因是我們在財政年初宣布的，對——當時，上海的封鎖非常明顯。我們可以預見到這一點。和地緣政治影響，我們實際上已經納入了這些——地緣政治的發展。但包括中國在內的全球經濟放緩是我們沒有真正預料到的。這是我們後來才看到的環境變化。我們已經根據這些新的發展對其進行了更新。

And what's being incorporated? What's not being operated? It's quite messy, if -- you feel like, well, partly because there was a positive from currency. But how much risks are we going to be incorporating? I guess that's what you're asking. But nature risks are very different from business to business, and the demand -- and how demand is going to go up or down.

什麼被納入？什麼沒有被操作？如果——你覺得，嗯，部分原因是貨幣有積極作用，那就太混亂了。但是我們要納入多少風險呢？我想這就是你要問的。但自然風險因企業和需求而異，以及需求將如何上升或下降。

And economic slowdown, the depth of and the length of economic slowdown, right? That is the very important factor in determining that, which is very difficult to predict. What we can do is get as clear as possible in terms of intelligence that we can gather right now. So positive impact from currency are not completely being reflected for risks. But as a matter of fact, in first quarter -- this is just first quarter. We have 3 more quarters to go. So in -- since that's -- yes, that's the only thing that I can say at least at high level.

經濟放緩，經濟放緩的深度和持續時間，對嗎？這是決定這一點的非常重要的因素，這很難預測。我們能做的就是盡可能清楚地了解我們現在可以收集的情報。因此，貨幣的積極影響並沒有完全反映在風險上。但事實上，在第一季度——這只是第一季度。我們還有 3 個季度要走。所以在 - 因為那是 - 是的，這是我唯一可以說的，至少在高級別。

Next person is the last question, is Nishimura-san with Crédit Suisse.

下一個人是最後一個問題，是瑞士信貸的西村先生。

And regarding gaming, and there has been the ForEx and also external factors. But is there a specific positive factor? For example, R&D and platform expansion? And also, there's -- I understand there's a launch for (inaudible) game. And if you could update us with those positive impact developments.

關於遊戲，有外彙和外部因素。但有沒有具體的積極因素？比如研發和平台拓展？而且，還有——我知道有一個（聽不清）遊戲的發布。如果您能向我們介紹這些積極影響的發展情況。

And from second quarter onward, positive factors you asked. PS5 hardware -- PlayStation 5 hardware production is now experiencing much less restrictions from component suppliers. That's, I believe, is one big factor. And we want to produce as many units as possible.

從第二季度開始，您提出的積極因素。 PS5 硬件——PlayStation 5 硬件生產現在受到組件供應商的限制要少得多。我相信，這是一大因素。我們希望生產盡可能多的單位。

In terms of production capacity, we have enough and -- because Shanghai lockdown is already been resolved. And as I mentioned over year that the logistics lead time is -- has not recovered to the level pre-COVID-19. So it will take a little bit longer. So even considering that, we want to produce more units as soon as possible.

就產能而言，我們有足夠的能力——因為上海的封鎖已經解決。正如我去年提到的那樣，物流交貨時間尚未恢復到 COVID-19 之前的水平。所以會花一點時間。所以即使考慮到這一點，我們也希望盡快生產更多的單位。

And in terms of a third-party and first-party from second quarter onward, as I mentioned earlier, major hit titles are expected, and that is going to be a positive factor, obviously.

正如我之前提到的，就第二季度以後的第三方和第一方而言，預計會有主要的熱門遊戲，這顯然是一個積極因素。

In terms of a platform expansion/extension, new PS5 has, on the positive side, that the -- as of the end of June, we were able to roll out, as was planned. And so customers are moving to the new platform. But how much of this is going to impact? And we -- too early to say because we just rolled it out in end of June. We need to collect more data to say anything conclusive. But I don't think -- I think we had a very good start. That's it.

在平台擴展/擴展方面，從積極的方面來說，新的 PS5 - 截至 6 月底，我們能夠按計劃推出。因此，客戶正在轉向新平台。但這會產生多大的影響？我們——現在說還為時過早，因為我們剛剛在 6 月底推出了它。我們需要收集更多數據才能說出任何結論。但我不認為——我認為我們有一個很好的開端。而已。

Okay. Now we have reached the scheduled ending time for Sony Group earnings announcement for Q1 FY '22. And thank you very much for your participation. Thank you.

好的。現在我們已經達到了索尼集團 22 財年第一季度收益公告的預定結束時間。非常感謝您的參與。謝謝你。

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

[本成績單上的英文陳述由現場通話中的一名口譯員說出。]