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Sony Corporation (SNE)

Corporate Strategy Meeting Conference Call for Overseas Investors

April 12, 2012 9:00 AM ET


Edward Reid – IR

Kazuo Hirai – President and CEO

Masaru Kato – EVP and CFO


Daniel Ernst – Hudson Square Research

Takashi Watanabe – Goldman Sachs Japan Co.

Jeff Loff – Macquarie Capital Securities

Karl Hammond



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Good day, ladies and gentlemen, and welcome to the Sony Corporate Strategy Meeting Conference Call for Overseas Investors. At this time, all participants are in a listen-only mode. (Operator Instructions). As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the call over to Mr. Edward Reid from Investor Relations Department at Sony Corporation. You may proceed.

Edward Reid

Thank you very much for that introduction, Frances, and thank you all for joining us today, April 12, 2012 for the discussion of Sony’s corporate strategy meeting. We hope you enjoyed music from Adele’s 21 while you were on hold. I’m Edward Reid from the Investor Relations Department here in Tokyo and with me on the conference call tonight is Kazuo Hirai, Representative Corporate Executive Officer, President and CEO of Sony Corporation; Marx Kato, CFO of Sony Corporation; and Yoshinori Hashitani, the VP, Senior General Manager, Investor Relations Division of Sony. Thank you all very much for joining us. In just a few moments, Mr. Hirai will go over the main points of today’s announcement. Then we will be available to answer your questions.

Please be aware that statements made during the following remarks and Q&A session with respect to Sony’s current plans, estimates, strategies, press release and other statements that are not historical facts, are forward-looking statements about the future performance of Sony. These statements are based on management’s assumptions in light of the information currently available to it and therefore, you should not place undue reliance on them.

Sony cautions you that a number of important factors could cause actual results to differ materially from those discussed in the forward-looking statements. For additional information as to the risks and uncertainties, as well as other factors that could cause actual results to differ, please refer to today’s press release, which can be accessed by visiting

Let me remind you that a webcast replay of the meeting held earlier today, along with the slides presented at that meeting are available on our website for your access.

With that, I’m now going to turn to today’s announcement and hand you over to Mr. Hirai.

Kazuo Hirai

Good afternoon, good morning and good evening, everybody, depending on where you are. This is Kazuo Hirai. I’d like to just make several opening comments before we move on to taking your questions and hopefully, you have the opportunity to review the press release and the presentation materials or have had the opportunity to perhaps view the video already. But I just wanted to spend maybe five minutes or so just going through the highlights of what was discussed at the Corporate Strategy Meeting here in Tokyo earlier today.

First, I talked about the key initiatives, five key initiatives that we will be focusing on to transform and turn around the electronics business, and I’m not going to go into detail on each of these, but just to highlight them in bullet point form.

Number one is strengthening our core business, which we have defined as the area of digital imaging, which also includes the image sensor business that we have on the semiconductor side, as well as obviously all of our consumer digital imaging products as well as our professional digital imaging products. Number two is the games business, obviously the PlayStation business PS3, PlayStation beta launched earlier this year in the European and U.S. markets, late last year in Japan, and also continuing strong, especially in the emerging markets, is the PlayStation Portable. The other area of focus is the mobile space, which includes obviously the Sony Xperia smartphone business, the Sony Tablet business, also the VAIO PCs.

The second key initiative is something that I’m sure everybody is very focused on, including ourselves, obviously, is bringing the TV business back to profitability. And as I outlined back in November of last year, I believe, we have embarked on a two-year plan, which has us returning the TV business back to profitability by the end of fiscal year 2013.

The third key initiative is growth in the emerging markets, where we see a huge growth opportunity in these emerging markets, and we expect that about 60% of our fiscal 2013 audio-visual and IT sales will come from the emerging markets. And we want to make sure that we leverage the strength that we have, the knowledge base that we’ve acquired in doing business in the emerging markets. We have some great examples where we command number one market share in certain categories such as in the Indian market as well as the Mexican market, we certainly want to leverage that experience into other markets as well.

The fourth key initiative is creating new businesses and also accelerating innovation. In this space, we talked about our planned entry into the medical space and then as far as innovation is concerned, accelerating our innovation in the 4K space where as some of you probably know, this is a – allows for a new display or monitor that has about four times resolution of the currently available high-definition. And we believe that this is another area of growth and innovation for our television business.

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