6-K 1 a51751623.htm SONY CORPORATION 6-K

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934

For the month of February 2018
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:  February 2, 2018

List of materials

Documents attached hereto:
 
i) Press release Announcement _______________________________________________________

 
 

 
 
 
 
 
 
 
 


Quarterly Financial Statements
for the Third Quarter Ended December 31, 2017
And
Outlook for the Fiscal Year Ending March 31, 2018


February 2, 2018
Sony Corporation


Quarterly Financial Statements (Unaudited)
F-1
   
Consolidated Balance Sheets
F-1
Consolidated Statements of Income (Three months ended December 31)
F-2
Consolidated Statements of Comprehensive Income (Three months ended December 31)
F-2
Consolidated Statements of Income (Nine months ended December 31)
F-3
Consolidated Statements of Comprehensive Income (Nine months ended December 31)
F-3
Consolidated Statements of Cash Flows (Nine months ended December 31)
F-4
Notes to Consolidated Financial Statements
F-5
-Business Segment Information
F-5
-Going Concern Assumption
F-12
-Significant Changes in Shareholders' Equity
 
F-12
-Accounting Policies and Other Information
F-12
   
Outlook for the Fiscal Year Ending March 31, 2018
  1
   
Outlook for the Fiscal Year Ending March 31, 2018
  1
   
Cautionary Statement
  4



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".

 

 
(Unaudited)
Consolidated Financial Statements
Consolidated Balance Sheets
 
 
    
 
   
(Millions of yen)
       
    
March 31
   
December 31
   
Change from
 
ASSETS
 
2017
   
2017
   
March 31, 2017
 
Current assets:
                 
Cash and cash equivalents
 
¥
960,142
   
¥
1,328,925
   
¥
+368,783
 
Marketable securities
   
1,051,441
     
1,221,687
     
+170,246
 
Notes and accounts receivable, trade
   
1,006,961
     
1,535,912
     
+528,951
 
Allowance for doubtful accounts and sales returns
   
(53,150
)
   
(62,135
)
   
-8,985
 
Inventories
   
640,835
     
753,658
     
+112,823
 
Other receivables
   
223,632
     
234,002
     
+10,370
 
Prepaid expenses and other current assets
   
525,861
     
548,742
     
+22,881
 
Total current assets
   
4,355,722
     
5,560,791
     
+1,205,069
 
                         
Film costs
   
336,928
     
365,783
     
+28,855
 
                         
Investments and advances:
                       
Affiliated companies
   
149,371
     
155,303
     
+5,932
 
Securities investments and other
   
9,962,422
     
10,401,319
     
+438,897
 
     
10,111,793
     
10,556,622
     
+444,829
 
                         
Property, plant and equipment:
                       
Land
   
117,293
     
114,967
     
-2,326
 
Buildings
   
666,381
     
685,576
     
+19,195
 
Machinery and equipment
   
1,842,852
     
1,855,459
     
+12,607
 
Construction in progress
   
28,779
     
45,041
     
+16,262
 
     
2,655,305
     
2,701,043
     
+45,738
 
Less-Accumulated depreciation
   
1,897,106
     
1,909,436
     
+12,330
 
     
758,199
     
791,607
     
+33,408
 
                         
Other assets:
                       
Intangibles, net
   
584,185
     
571,027
     
-13,158
 
Goodwill
   
522,538
     
552,336
     
+29,798
 
Deferred insurance acquisition costs
   
568,837
     
595,180
     
+26,343
 
Deferred income taxes
   
98,958
     
91,452
     
-7,506
 
Other
   
323,396
     
335,878
     
+12,482
 
     
2,097,914
     
2,145,873
     
+47,959
 
                         
Total assets
 
¥
17,660,556
   
¥
19,420,676
   
¥
+1,760,120
 
                         
                         
LIABILITIES AND EQUITY
                       
Current liabilities:
                       
Short-term borrowings
 
¥
464,655
   
¥
537,443
   
¥
+72,788
 
Current portion of long-term debt
   
53,424
     
245,646
     
+192,222
 
Notes and accounts payable, trade
   
539,900
     
658,250
     
+118,350
 
Accounts payable, other and accrued expenses
   
1,394,758
     
1,621,542
     
+226,784
 
Accrued income and other taxes
   
106,037
     
213,874
     
+107,837
 
Deposits from customers in the banking business
   
2,071,091
     
2,159,747
     
+88,656
 
Other
   
591,874
     
585,348
     
-6,526
 
Total current liabilities
   
5,221,739
     
6,021,850
     
+800,111
 
                         
Long-term debt
   
681,462
     
594,195
     
-87,267
 
Accrued pension and severance costs
   
396,715
     
403,663
     
+6,948
 
Deferred income taxes
   
432,824
     
428,147
     
-4,677
 
Future insurance policy benefits and other
   
4,834,492
     
5,104,322
     
+269,830
 
Policyholders' account in the life insurance business
   
2,631,073
     
2,854,660
     
+223,587
 
Other
   
314,771
     
284,283
     
-30,488
 
Total liabilities
   
14,513,076
     
15,691,120
     
+1,178,044
 
                         
Redeemable noncontrolling interest
   
12,058
     
14,609
     
+2,551
 
                         
Equity:
                       
Sony Corporation's stockholders' equity:
                       
Common stock
   
860,645
     
864,078
     
+3,433
 
Additional paid-in capital
   
1,275,337
     
1,279,422
     
+4,085
 
Retained earnings
   
984,368
     
1,476,194
     
+491,826
 
Accumulated other comprehensive income
   
(618,769
)
   
(575,320
)
   
+43,449
 
Treasury stock, at cost
   
(4,335
)
   
(4,481
)
   
-146
 
     
2,497,246
     
3,039,893
     
+542,647
 
                         
Noncontrolling interests
   
638,176
     
675,054
     
+36,878
 
  Total equity
   
3,135,422
     
3,714,947
     
+579,525
 
  Total liabilities and equity
 
¥
17,660,556
   
¥
19,420,676
   
¥
+1,760,120
 
 
F - 1

 
Consolidated Statements of Income
 
    
(Millions of yen, except per share amounts)
 
    
Three months ended December 31
 
   
2016
   
2017
   
Change
 
Sales and operating revenue:
                 
Net sales
 
¥
2,059,578
   
¥
2,279,714
   
¥
+220,136
 
Financial services revenue
   
317,342
     
371,498
     
+54,156
 
Other operating revenue
   
20,579
     
21,105
     
+526
 
     
2,397,499
     
2,672,317
     
+274,818
 
                         
Costs and expenses:
                       
Cost of sales
   
1,495,036
     
1,607,962
     
+112,926
 
Selling, general and administrative
   
411,652
     
415,532
     
+3,880
 
Financial services expenses
   
286,740
     
315,404
     
+28,664
 
Other operating (income) expense, net
   
113,013
     
(13,119
)
   
-126,132
 
     
2,306,441
     
2,325,779
     
+19,338
 
                         
Equity in net income of affiliated companies
   
1,314
     
4,299
     
+2,985
 
                         
Operating income
   
92,372
     
350,837
     
+258,465
 
                         
Other income:
                       
Interest and dividends
   
2,502
     
3,519
     
+1,017
 
Gain on sale of securities investments, net
   
92
     
833
     
+741
 
Other
   
189
     
1,531
     
+1,342
 
     
2,783
     
5,883
     
+3,100
 
                         
Other expenses:
                       
Interest
   
3,749
     
3,536
     
-213
 
Loss on devaluation of securities investments
   
4,810
     
1,324
     
-3,486
 
Foreign exchange loss, net
   
18,420
     
5,888
     
-12,532
 
Other
   
1,949
     
2,853
     
+904
 
     
28,928
     
13,601
     
-15,327
 
                         
Income before income taxes
   
66,227
     
343,119
     
+276,892
 
                         
Income taxes
   
36,956
     
28,234
     
-8,722
 
                         
Net income
   
29,271
     
314,885
     
+285,614
 
                         
Less - Net income attributable to noncontrolling interests
   
9,640
     
18,988
     
+9,348
 
                         
Net income attributable to Sony Corporation's
                       
   stockholders
 
¥
19,631
   
¥
295,897
   
¥
+276,266
 
                         
                         
                         
Per share data:
                       
Net income attributable to Sony Corporation's
                       
   stockholders
                       
   — Basic
 
¥
15.55
   
¥
234.08
   
¥
+218.53
 
   — Diluted
   
15.24
     
228.91
     
+213.67
 
 
 
Consolidated Statements of Comprehensive Income
                 
    
 
   
(Millions of yen)
       
    
Three months ended December 31
 
   
2016
   
2017
   
Change
 
                   
Net income
 
¥
29,271
   
¥
314,885
   
¥
+285,614
 
                         
Other comprehensive income, net of tax –
                       
Unrealized gains (losses) on securities
   
(8,314
)
   
11,688
     
+20,002
 
Unrealized gains (losses) on derivative instruments
   
3,430
     
(79
)
   
-3,509
 
Pension liability adjustment
   
3,250
     
2,365
     
-885
 
Foreign currency translation adjustments
   
112,440
     
3,655
     
-108,785
 
                         
Total comprehensive income
   
140,077
     
332,514
     
+192,437
 
                         
Less - Comprehensive income attributable
                       
   to noncontrolling interests
   
2,152
     
21,603
     
+19,451
 
                         
Comprehensive income attributable
                       
   to Sony Corporation's stockholders
 
¥
137,925
   
¥
310,911
   
¥
+172,986
 
 
F - 2

Consolidated Statements of Income
               
 
(Millions of yen, except per share amounts)
 
 
Nine months ended December 31
 
 
2016
   
2017
   
Change
 
Sales and operating revenue:
               
Net sales
 
¥
4,834,013
   
¥
5,573,273
   
¥
+739,260
 
Financial services revenue
   
806,954
     
950,292
     
+143,338
 
Other operating revenue
   
58,679
     
69,396
     
+10,717
 
     
5,699,646
     
6,592,961
     
+893,315
 
                         
Costs and expenses:
                       
Cost of sales
   
3,559,927
     
3,957,700
     
+397,773
 
Selling, general and administrative
   
1,088,096
     
1,159,190
     
+71,094
 
Financial services expenses
   
693,537
     
810,967
     
+117,430
 
Other operating (income) expense, net
   
165,454
     
(40,131
)
   
-205,585
 
     
5,507,014
     
5,887,726
     
+380,712
 
                         
Equity in net income of affiliated companies
   
1,679
     
7,441
     
+5,762
 
                         
Operating income
   
194,311
     
712,676
     
+518,365
 
                         
Other income:
                       
Interest and dividends
   
7,859
     
16,556
     
+8,697
 
Gain on sale of securities investments, net
   
155
     
1,479
     
+1,324
 
Other
   
1,906
     
2,529
     
+623
 
     
9,920
     
20,564
     
+10,644
 
                         
Other expenses:
                       
Interest
   
11,902
     
10,782
     
-1,120
 
Loss on devaluation of securities investments
   
4,860
     
1,803
     
-3,057
 
Foreign exchange loss, net
   
19,230
     
25,154
     
+5,924
 
Other
   
4,476
     
4,923
     
+447
 
     
40,468
     
42,662
     
+2,194
 
                         
Income before income taxes
   
163,763
     
690,578
     
+526,815
 
                         
Income taxes
   
80,931
     
138,481
     
+57,550
 
                         
Net income
   
82,832
     
552,097
     
+469,265
 
                         
Less - Net income attributable to noncontrolling interests
   
37,193
     
44,477
     
+7,284
 
                         
Net income attributable to Sony Corporation’s
                       
   stockholders
   
45,639
     
507,620
     
+461,981
 
                         
                         
                         
Per share data:
                       
Net income attributable to Sony Corporation’s
                       
   stockholders
                       
   — Basic
 
¥
36.17
   
¥
401.76
   
¥
+365.59
 
   — Diluted
   
35.43
     
393.05
     
+357.62
 
                         
                         
Consolidated Statements of Comprehensive Income
                       
 
(Millions of yen)
 
 
Nine months ended December 31
 
             
Change 
         
                         
Net income
 
¥
82,832
   
¥
552,097
   
¥
+469,265
 
                         
Other comprehensive income, net of tax –
                       
Unrealized gains (losses) on securities
   
(25,645
)
   
7,030
     
+32,675
 
Unrealized gains on derivative instruments
   
3,690
     
150
     
-3,540
 
Pension liability adjustment
   
9,297
     
7,009
     
-2,288
 
Foreign currency translation adjustments
   
5,377
     
33,742
     
+28,365
 
                         
Total comprehensive income
   
75,551
     
600,028
     
+524,477
 
                         
Less - Comprehensive income attributable to noncontrolling interests
   
21,307
     
48,959
     
+27,652
 
                         
Comprehensive income attributable
                       
   to Sony Corporation’s stockholders
 
¥
54,244
   
¥
551,069
   
¥
+496,825
 
                         
F - 3

 
Consolidated Statements of Cash Flows
           
   
(Millions of yen)
 
   
Nine months ended December 31
 
 
 
2016
   
2017
 
Cash flows from operating activities:
           
Net income
 
¥
82,832
   
¥
552,097
 
Adjustments to reconcile net income to net cash
               
provided by operating activities:
               
Depreciation and amortization, including amortization of deferred
               
    insurance acquisition costs
   
259,554
     
258,187
 
Amortization of film costs
   
190,539
     
259,709
 
Accrual for pension and severance costs, less payments
   
7,270
     
3,948
 
Other operating (income) expense, net
   
165,454
     
(40,131
)
Loss on sale or devaluation of securities investments, net
   
4,706
     
324
 
Gain on revaluation of marketable securities held in the financial
               
    services business for trading purposes, net
   
(42,727
)
   
(109,888
)
Loss on revaluation or impairment of securities investments held
               
    in the financial services business, net
   
29
     
213
 
Deferred income taxes
   
4,450
     
(4,551
)
Equity in net (income) loss of affiliated companies, net of dividends
   
5,770
     
(2,125
)
Changes in assets and liabilities:
               
   Increase in notes and accounts receivable, trade
   
(372,978
)
   
(488,285
)
   Increase in inventories
   
(18,622
)
   
(88,954
)
   Increase in film costs
   
(242,875
)
   
(279,082
)
   Increase in notes and accounts payable, trade
   
87,698
     
90,484
 
   Increase in accrued income and other taxes
   
65,951
     
70,983
 
   Increase in future insurance policy benefits and other
   
336,157
     
424,084
 
   Increase in deferred insurance acquisition costs
   
(70,070
)
   
(65,248
)
   Increase in marketable securities held in the financial services
               
        business for trading purposes
   
(60,868
)
   
(64,727
)
   Increase in other current assets
   
(46,705
)
   
(25,633
)
   Increase in other current liabilities
   
55,453
     
189,524
 
Other
   
(97,766
)
   
(20,600
)
        Net cash provided by operating activities
   
313,252
     
660,329
 
                 
Cash flows from investing activities:
               
Payments for purchases of fixed assets
   
(260,457
)
   
(189,780
)
Proceeds from sales of fixed assets
   
9,134
     
15,095
 
Payments for investments and advances by financial services business
   
(943,712
)
   
(671,982
)
Payments for investments and advances
               
    (other than financial services business)
   
(7,487
)
   
(16,526
)
Proceeds from sales or return of investments and collections of advances
         
   by financial services business
   
212,624
     
256,652
 
Proceeds from sales or return of investments and collections of advances
         
   (other than financial services business)
   
13,837
     
5,404
 
Proceeds from sales of businesses
   
3,262
     
44,624
 
Other
   
(8,715
)
   
(10,400
)
        Net cash used in investing activities
   
(981,514
)
   
(566,913
)
                 
Cash flows from financing activities:
               
Proceeds from issuance of long-term debt
   
255,416
     
92,833
 
Payments of long-term debt
   
(182,670
)
   
(20,570
)
Increase in short-term borrowings, net
   
275,084
     
72,913
 
Increase in deposits from customers in the financial services business, net
   
254,279
     
154,374
 
Dividends paid
   
(25,308
)
   
(27,750
)
Payment for purchase of Sony/ATV shares from noncontrolling interests
   
(76,565
)
 
 
Other
   
(32,385
)
   
(6,612
)
        Net cash provided by financing activities
   
467,851
     
265,188
 
                 
Effect of exchange rate changes on cash and cash equivalents
   
(11,525
)
   
10,179
 
                 
Net increase (decrease) in cash and cash equivalents
   
(211,936
)
   
368,783
 
Cash and cash equivalents at beginning of the fiscal year
   
983,612
     
960,142
 
                 
Cash and cash equivalents at end of the period
 
¥
771,676
   
¥
1,328,925
 
 
F - 4

Notes to Consolidated Financial Statements
               
Business Segment Information
               
(Business Segments)
               
 
(Millions of yen)
       
 
Three months ended December 31
       
Sales and operating revenue
2016
   
2017
   
Change
 
Game & Network Services
               
Customers
 
¥
596,997
   
¥
681,649
   
¥
+84,652
 
Intersegment
   
20,702
     
36,317
     
+15,615
 
Total
   
617,699
     
717,966
     
+100,267
 
                         
Music
                       
Customers
   
173,218
     
214,267
     
+41,049
 
Intersegment
   
5,289
     
4,162
     
-1,127
 
Total
   
178,507
     
218,429
     
+39,922
 
                         
Pictures
                       
Customers
   
224,771
     
260,050
     
+35,279
 
Intersegment
   
385
     
267
     
-118
 
Total
   
225,156
     
260,317
     
+35,161
 
                         
Home Entertainment & Sound
                       
Customers
   
351,983
     
429,604
     
+77,621
 
Intersegment
   
1,442
     
243
     
-1,199
 
Total
   
353,425
     
429,847
     
+76,422
 
                         
Imaging Products & Solutions
                       
Customers
   
165,260
     
179,112
     
+13,852
 
Intersegment
   
1,859
     
1,990
     
+131
 
Total
   
167,119
     
181,102
     
+13,983
 
                         
Mobile Communications
                       
Customers
   
247,173
     
215,141
     
-32,032
 
Intersegment
   
1,424
     
2,402
     
+978
 
Total
   
248,597
     
217,543
     
-31,054
 
                         
Semiconductors
                       
Customers
   
205,021
     
218,303
     
+13,282
 
Intersegment
   
28,847
     
32,627
     
+3,780
 
Total
   
233,868
     
250,930
     
+17,062
 
                         
Financial Services
                       
Customers
   
317,342
     
371,498
     
+54,156
 
Intersegment
   
1,800
     
1,773
     
-27
 
Total
   
319,142
     
373,271
     
+54,129
 
                         
All Other
                       
Customers
   
109,933
     
96,611
     
-13,322
 
Intersegment
   
21,713
     
11,971
     
-9,742
 
Total
   
131,646
     
108,582
     
-23,064
 
                         
Corporate and elimination
   
(77,660
)
   
(85,670
)
   
-8,010
 
Consolidated total
 
¥
2,397,499
   
¥
2,672,317
   
¥
+274,818
 
                         
Game & Network Services (“G&NS”) intersegment amounts primarily consist of transactions with All Other.
Semiconductors 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)
 
     
Three months ended December 31        
 
Operating income (loss)
    2016       2017    
Change
 
Game & Network Services
 
¥
50,028
   
¥
85,364
   
¥
+35,336
 
Music
   
27,982
     
39,342
     
+11,360
 
Pictures
   
(106,774
)
   
10,489
     
+117,263
 
Home Entertainment & Sound
   
25,934
     
46,213
     
+20,279
 
Imaging Products & Solutions
   
21,101
     
25,982
     
+4,881
 
Mobile Communications
   
21,218
     
15,801
     
-5,417
 
Semiconductors
   
27,166
     
60,558
     
+33,392
 
Financial Services
   
28,996
     
56,287
     
+27,291
 
All Other
   
(2,049
)
   
2,255
     
+4,304
 
Total
   
93,602
     
342,291
     
+248,689
 
                         
Corporate and elimination
   
(1,230
)
   
8,546
     
+9,776
 
Consolidated total
 
¥
92,372
   
¥
350,837
   
¥
+258,465
 
                         
The 2016 segment disclosure above has been reclassified to reflect the change in the business segment classification.
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 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.
 
 
F - 5

 
(Business Segments)
                 
   
(Millions of yen)  
 
   
Nine months ended December 31
 
Sales and operating revenue
 
2016
   
2017
   
Change
 
Game & Network Services
                 
Customers
 
¥
1,212,613
   
¥
1,418,955
   
¥
+206,342
 
Intersegment
   
55,345
     
80,277
     
+24,932
 
Total
   
1,267,958
     
1,499,232
     
+231,274
 
                         
Music
                       
Customers
   
458,256
     
582,180
     
+123,924
 
Intersegment
   
12,366
     
11,387
     
-979
 
Total
   
470,622
     
593,567
     
+122,945
 
                         
Pictures
                       
Customers
   
599,920
     
709,458
     
+109,538
 
Intersegment
   
665
     
673
     
+8
 
Total
   
600,585
     
710,131
     
+109,546
 
                         
Home Entertainment & Sound
                       
Customers
   
820,799
     
986,839
     
+166,040
 
Intersegment
   
3,422
     
808
     
-2,614
 
Total
   
824,221
     
987,647
     
+163,426
 
                         
Imaging Products & Solutions
                       
Customers
   
419,662
     
488,399
     
+68,737
 
Intersegment
   
5,055
     
5,058
     
+3
 
Total
   
424,717
     
493,457
     
+68,740
 
                         
Mobile Communications
                       
Customers
   
598,855
     
564,025
     
-34,830
 
Intersegment
   
4,435
     
6,746
     
+2,311
 
Total
   
603,290
     
570,771
     
-32,519
 
                         
Semiconductors
                       
Customers
   
484,332
     
584,389
     
+100,057
 
Intersegment
   
87,714
     
99,165
     
+11,451
 
Total
   
572,046
     
683,554
     
+111,508
 
                         
Financial Services
                       
Customers
   
806,954
     
950,292
     
+143,338
 
Intersegment
   
5,417
     
5,363
     
-54
 
Total
   
812,371
     
955,655
     
+143,284
 
                         
All Other
                       
Customers
   
276,660
     
286,307
     
+9,647
 
Intersegment
   
57,113
     
44,335
     
-12,778
 
Total
   
333,773
     
330,642
     
-3,131
 
                         
Corporate and elimination
   
(209,937
)
   
(231,695
)
   
-21,758
 
Consolidated total
 
¥
5,699,646
   
¥
6,592,961
   
¥
+893,315
 
                         
G&NS intersegment amounts primarily consist of transactions with All Other.
Semiconductors 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)
 
   
Nine months ended December 31
 
Operating income (loss)
    2016        2017     
Change
 
Game & Network Services
 
¥
113,051
   
¥
157,847
   
¥
+44,796
 
Music
   
60,373
     
96,878
     
+36,505
 
Pictures
   
(114,207
)
   
8,688
     
+122,895
 
Home Entertainment & Sound
   
63,731
     
93,183
     
+29,452
 
Imaging Products & Solutions
   
43,467
     
68,056
     
+24,589
 
Mobile Communications
   
25,331
     
16,964
     
-8,367
 
Semiconductors
   
(20,567
)
   
165,370
     
+185,937
 
Financial Services
   
111,106
     
139,109
     
+28,003
 
All Other
   
(41,604
)
   
(6,004
)
   
+35,600
 
Total
   
240,681
     
740,091
     
+499,410
 
                         
Corporate and elimination
   
(46,370
)
   
(27,415
)
   
+18,955
 
Consolidated total
 
¥
194,311
   
¥
712,676
   
¥
+518,365
 
                         
The 2016 segment disclosure above has been reclassified to reflect the change in the business segment classification.
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 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.
 
 
F - 6

(Sales to Customers by Product Category)
                 
   
(Millions of yen)
 
   
Three months ended December 31
 
 
  2016    
2017
   
Change
 
                   
Game & Network Services
                 
Hardware
 
¥
279,858
   
¥
270,653
   
¥
-9,205
 
Network
   
212,701
     
300,407
     
+87,706
 
Other
   
104,438
     
110,589
     
+6,151
 
Total
   
596,997
     
681,649
     
+84,652
 
                         
Music
                       
Recorded Music
   
114,833
     
128,239
     
+13,406
 
Music Publishing
   
15,549
     
18,334
     
+2,785
 
Visual Media and Platform
   
42,836
     
67,694
     
+24,858
 
Total
   
173,218
     
214,267
     
+41,049
 
                         
Pictures
                       
Motion Pictures
   
96,427
     
106,931
     
+10,504
 
Television Productions
   
73,044
     
82,227
     
+9,183
 
Media Networks
   
55,300
     
70,892
     
+15,592
 
Total
   
224,771
     
260,050
     
+35,279
 
                         
Home Entertainment & Sound
                       
Televisions
   
244,421
     
301,476
     
+57,055
 
Audio and Video
   
106,916
     
127,303
     
+20,387
 
Other
   
646
     
825
     
+179
 
Total
   
351,983
     
429,604
     
+77,621
 
                         
Imaging Products & Solutions
                       
Still and Video Cameras
   
110,962
     
121,156
     
+10,194
 
Other
   
54,298
     
57,956
     
+3,658
 
Total
   
165,260
     
179,112
     
+13,852
 
                         
Mobile Communications
   
247,173
     
215,141
     
-32,032
 
                         
Semiconductors
   
205,021
     
218,303
     
+13,282
 
                         
Financial Services
   
317,342
     
371,498
     
+54,156
 
                         
All Other
   
109,933
     
96,611
     
-13,322
 
                         
Corporate
   
5,801
     
6,082
     
+281
 
Consolidated total
 
¥
2,397,499
   
¥
2,672,317
   
¥
+274,818
 
                         
                         
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-5. 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.

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 Interactive Entertainment; Other includes packaged software and peripheral devices. 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 the production and distribution of animation titles, including game applications based on the animation titles, and various service offerings for music and visual products. In the Pictures segment, Motion Pictures includes the worldwide production, acquisition and distribution of motion pictures and direct-to-video content; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks worldwide. In the Home Entertainment & Sound (“HE&S”) segment, Televisions includes LCD and OLED televisions; Audio and Video includes Blu-ray disc players and recorders, home audio, headphones and memory-based portable audio devices. In the IP&S segment, Still and Video Cameras includes interchangeable lens cameras, compact digital cameras, consumer video cameras and video cameras for broadcast; Other includes display products such as projectors and medical equipment.
 
 
F - 7

                   
(Sales to Customers by Product Category)
                 
   
(Millions of yen)  
 
   
Nine months ended December 31
 
Sales and operating revenue (to external customers)
 
2016
   
2017
   
Change
 
                   
Game & Network Services
                 
Hardware
 
¥
505,409
   
¥
506,366
   
¥
+957
 
Network
   
504,868
     
718,695
     
+213,827
 
Other
   
202,336
     
193,894
     
-8,442
 
Total
   
1,212,613
     
1,418,955
     
+206,342
 
                         
Music
                       
Recorded Music
   
294,296
     
337,238
     
+42,942
 
Music Publishing
   
46,791
     
54,693
     
+7,902
 
Visual Media and Platform
   
117,169
     
190,249
     
+73,080
 
Total
   
458,256
     
582,180
     
+123,924
 
                         
Pictures
                       
Motion Pictures
   
265,701
     
302,005
     
+36,304
 
Television Productions
   
168,661
     
201,514
     
+32,853
 
Media Networks
   
165,558
     
205,939
     
+40,381
 
Total
   
599,920
     
709,458
     
+109,538
 
                         
Home Entertainment & Sound
                       
Televisions
   
579,811
     
700,403
     
+120,592
 
Audio and Video
   
239,770
     
284,664
     
+44,894
 
Other
   
1,218
     
1,772
     
+554
 
Total
   
820,799
     
986,839
     
+166,040
 
                         
Imaging Products & Solutions
                       
Still and Video Cameras
   
267,962
     
326,362
     
+58,400
 
Other
   
151,700
     
162,037
     
+10,337
 
Total
   
419,662
     
488,399
     
+68,737
 
                         
Mobile Communications
   
598,855
     
564,025
     
-34,830
 
                         
Semiconductors
   
484,332
     
584,389
     
+100,057
 
                         
Financial Services
   
806,954
     
950,292
     
+143,338
 
                         
All Other
   
276,660
     
286,307
     
+9,647
 
                         
Corporate
   
21,595
     
22,117
     
+522
 
Consolidated total
 
¥
5,699,646
   
¥
6,592,961
   
¥
+893,315
 
                         
                         
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.

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 Interactive Entertainment; Other includes packaged software and peripheral devices. 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 the production and distribution of animation titles, including game applications based on the animation titles, and various service offerings for music and visual products. In the Pictures segment, Motion Pictures includes the worldwide production, acquisition and distribution of motion pictures and direct-to-video content; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks worldwide. In the HE&S segment, Televisions includes LCD and OLED televisions; Audio and Video includes Blu-ray disc players and recorders, home audio, headphones and memory-based portable audio devices. In the IP&S segment, Still and Video Cameras includes interchangeable lens cameras, compact digital cameras, consumer video cameras and video cameras for broadcast; Other includes display products such as projectors and medical equipment.
 
 
F - 8

(Condensed Financial Services Financial Statements)
                                               
The following schedules show unaudited condensed financial statements for the Financial Services segment and all other segments excluding Financial Services. These presentations are not in accordance with 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)
         
 
Financial Services
 
Sony without
Financial Services
 
Consolidated
 
                         
 
March 31
 
December 31
 
March 31
 
December 31
 
March 31
 
December 31
 
 
2017   2017  
2017
  2017  
2017
  2017  
  ASSETS
                       
Current assets:
                       
Cash and cash equivalents
 
¥
268,382
   
¥
427,384
   
¥
691,760
   
¥
901,541
   
¥
960,142
   
¥
1,328,925
 
Marketable securities
   
1,051,441
     
1,221,687
 
 
     
1,051,441
     
1,221,687
 
Notes and accounts receivable, trade
   
10,931
     
14,896
     
947,602
     
1,463,359
     
953,811
     
1,473,777
 
Inventories
     
-
     
640,835
     
753,658
     
640,835
     
753,658
 
Other receivables
   
56,807
     
60,167
     
167,127
     
174,005
     
223,632
     
234,002
 
Prepaid expenses and other current assets
   
112,085
     
139,288
     
414,420
     
410,142
     
525,861
     
548,742
 
 Total current assets
   
1,499,646
     
1,863,422
     
2,861,744
     
3,702,705
     
4,355,722
     
5,560,791
 
                                                 
Film costs
 
     
336,928
     
365,783
     
336,928
     
365,783
 
                                                 
Investments and advances
   
9,904,576
     
10,343,208
     
285,965
     
291,155
     
10,111,793
     
10,556,622
 
                                                 
Investments in Financial Services, at cost
 
     
133,514
     
133,514
 
 
 
                                                 
Property, plant and equipment
   
21,323
     
29,106
     
735,590
     
761,215
     
758,199
     
791,607
 
                                                 
Other assets:
                                               
Intangibles, net
   
30,643
     
31,306
     
553,542
     
539,721
     
584,185
     
571,027
 
Goodwill
   
2,375
     
7,225
     
520,163
     
545,111
     
522,538
     
552,336
 
Deferred insurance acquisition costs
   
568,837
     
595,180
 
 
     
568,837
     
595,180
 
Deferred income taxes
   
1,868
     
1,093
     
97,090
     
90,359
     
98,958
     
91,452
 
Other
   
34,607
     
35,447
     
292,529
     
304,178