Thank you very much for taking time to join us today. We will now begin the Sony Group Corporation's Corporate Strategy and Earnings Announcement Presentation. I am Ishii from Corporate Communications. I'll be serving as MC. First, Hiroki Totoki, President and CEO of Sony Group Corporation, will explain our corporate strategy. This will be followed by Lin Tao, who will present the FY 2025 financial results and the full-year forecast for FY 2026. Please note that to ensure our international participants can hear from the speakers directly, the English version of the presentations will be delivered via a pre-recorded video. We will move on to the Q&A session. The total duration is scheduled to be approximately 100 minutes. Totoki-san, please. Hello, thank you for joining us. Today, I'd like to share a brief update on Sony's business, our corporate priorities and direction as we enter the final year of our current Mid-Range Plan. It has been a truly exceptional year for Sony since our last corporate strategy presentation, a year marked by strong performance and record result across many of our key businesses as we continue to focus and build on our creative entertainment vision. We continue to evolve our business portfolio as we seek new opportunities for growth and meet new challenges in a rapidly changing market. Two years ago, we kicked off the current Mid-Range Plan, highlighting the evolution of our business direction in entertainment, IP, content creation, and real-time creation technology. We launched our creative entertainment vision, our long-term vision, which seeks to leverage the power of technology to empower creators, deliver new experiences across both physical and digital space, and maximize the value of IPs. Sony's purpose to fill the world with emotion through creativity and technology is at the heart of our creative entertainment vision and is driving success and potential growth opportunities across our Sony Group businesses, including our G&NS segment, whose PlayStation platform now hosts over 125 million active users around the world who enjoy their favorite titles wherever they are and connect with their friend through gameplay. Sony's music businesses, which have enjoyed tremendous success and growth through their efforts to nurture and build strong relationships with a growing roster of outstanding talent, digital streaming platforms, and global audiences. Our pictures business, which continue to produce and distribute strong film and TV content and serve as an important hub for cross-company collaborations, such as many PlayStation Productions film and TV adaptations of game IP. Our ET&S segment is expanding its sports business by advancing officiating technologies and fan engagement initiatives and investing in athlete performance tracking solutions while inspiring creators by enabling high-quality, innovative content production. Underpinning that creativity at its very core is the evolution of image sensors in our I&SS segment. We also have anime, which cuts across several our businesses and remains an important growth sector for Sony and a key part of our creative entertainment vision. Sony's strengths come from the synergies and collaborations effort that exist across Sony Group companies and with our strategic partners spanning production, fan engagement, marketing, and global distribution to deliver anime at scale to worldwide audiences. The explosive worldwide growth of anime is demonstrated by last year's massive global hit film, Demon Slayer: Kimetsu no Yaiba – Infinity Castle, which was produced by Aniplex and our partners and is a rapid growth of Crunchyroll. Crunchyroll now serves more than 21 million paid subscribers globally as an anime distribution platform with a library of more than 50,000 episodes, including many of the most popular and current series from Japan, subtitled and dubbed in 13 languages. In addition, we enabled expanding global fan participation in voting through MyAnimeList for the first time for the upcoming Crunchyroll Anime Awards through our partnership with Gaudiy. This fall, Crunchyroll will host its first-year Crunchyroll Anime Future Forum in New York, bringing together leaders across anime, gaming, music, film, and emerging technology to strengthen relationships with Japanese publishers and creators globally. During this Mid-Range Plan period, we also continued to shape our world portfolio. Last fall, we completed the partial spin-off of the financial service business. In March, Sony Corporation entered into definitive agreement with TCL, forming a strategic partnership for BRAVIA TVs, B2B flat panel displays, home theater, and home audio components, strengthening the resilience of each of those businesses. All the while, we have continued to invest and lean into areas where we see ongoing growth and competitive advantage. Building on the strategic partnerships announced with Bandai Namco Holdings last summer, we are further strengthening our position in anime, an important growth sector for us in addition to other areas. Our recent agreement with WildBrain to acquire their stake in Peanuts Holdings increased Sony's ownership stake to 80% to expand its beloved and globally recognized brand. An ongoing investment in music following major deals to acquire the Pink Floyd and Queen catalogs, Sony Music Group recently announced a partnership with GIC, the Singapore Sovereign Wealth Fund, to further build our music IP investments. Together, these strategic decisions reflect the ongoing evolution of Sony Group's business direction towards entertainment, IP, and creation technology, which now represents 67% of Sony's consolidated sales. Overall, it was a very strong year in terms of performance. We will change direction on a few strategic initiatives, pivoting better position us moving forward. We decided to wind down our Pixomondo visual effect business and focus on new technologies. We downwardly revised our projections and recorded an impairment loss against a long-lived asset at Bungie. Due to Honda's reassessment of its EV strategy, we discontinued the development and production of Sony Honda Mobility's AFEELA models. These strategic shifts were made on the back of strong FY 2025 performance to position the company for future growth. You'll hear more details on each of these moves as well as our financial results from our CFO, Lin Tao, shortly. Now I would like to turn to the topic of AI. When we think about further growth at Sony Group, AI is one of the most important themes for us to consider, especially the potential it holds for us across Sony Group businesses to unlock new value creation and capture new opportunities for growth across our entertainment businesses. Let me start by stating a core principle that guides our thinking about AI. Human creativity must remain at the center. AI is a powerful tool, but it's not a replacement for artists or creators. It is an amplifier of human imagination and catalyst for new possibilities. Great content comes from deep personal experiences, unique perspectives, and a strong inner motivation to express something meaningful. Fans are drawn to such stories, characters, and worlds that offer deep emotional connection. We believe the most memorable experiences will always be created by humans and enjoyed by people. AI can assist in that process, but it will not replace human imagination, creativity, and emotions. AI brings new opportunities to the world of entertainment, not only in terms of efficiency, but in empowering creators to expand their creativity. Additionally, we believe AI will make it easier to take on more innovative and ambitious projects that were previously difficult to pursue due to constraints of cost and time. For example, this shift represents a significant opportunity for PlayStation as a platform. As more diverse and innovative content is created and overall game industry continues to evolve, PlayStation can connect more fans with more games, further strengthening its value. At Sony Pictures, we are scaling AI and other advanced technology across workflows to accelerate production timelines and increase output and have invested more than $50 million to date in AI capabilities across production planning, content protection, enterprise productivity, data analytics, innovation, and 3D conversion. Sony Music is encouraged by the increased number of companies who agree that intellectual property rights need to be respected and therefore want to negotiate licenses for new products with them. These partnerships will lead to business expansion that will also benefit consumers and creators. To drive such efforts, Sony Music is actively pursuing an industry-wide standard to label AI content for further transparency with consumers. Alongside our own efforts, we are currently engaged in a collaborative pilot initiative with Bandai Namco Holdings to explore how generative AI and the latest technologies can most effectively contribute to realizing a creator's vision in the realm of video production. Through these explorations, we have identified massive gains in speed and productivity per person, as well as how to concretely address the shortcomings of generative AI based on the understanding of the strengths and weaknesses of the models. One example of the weaknesses is the lack of consistency and controllability, which is demanded by creators and those involved in production. We have accumulated know-how to resolve such issues by utilizing various AI models as well as fine-tuning models with technology and proprietary data to consistently generate output of intended style with accuracy and cost that will be necessary for deployment. On the other hand, we have also identified opportunities where AI can produce highly sophisticated and realistic outputs, which were not feasible before due to production time constraints. We hope to contribute to the overall growth of the industry through such collaborations and by combining Sony's expertise in audio, video processing, spatial, and CG technology with generative AI to create a creator-first production environment that is safe and secure to use while maximizing their artistic sensitivity and output. Now, I would like to introduce Hideaki Nishino, President and CEO of Sony Interactive Entertainment, to say a few words about how we see AI strengthening our efforts in one of our most important growth areas, games. At PlayStation, our goal is always to be the best place to play and the best place to publish. We see AI as a powerful tool to help us in this mission. For our players, this will mean gaming experience like never before. More immersion, more adventures, and fresh ways to enjoy their favorite characters. For our publishers, this will mean a more efficient production environment and a better discovery to ensure their games reach the right audience. AI is lowering the barriers to creation, accelerating the development cycles, and enabling more creators to enter the market. As a result, we expect to see a meaningful increase in the volume and diversity of the content available to the players. Our platform's role will be critical in ensuring players find the right content in an increasingly crowded landscape. Our studios and their IP will also continue to be a key differentiator. When players have more choice, they will gravitate towards trusted franchises they know will deliver the high-quality experiences. Within our studios, game developers are automating repetitive workloads, improving software engineering productivity, and accelerating areas like quality assurance, 3D modeling, and animations through new AI-powered tools. For example, our teams created a tool we call Mockingbird that quickly animates 3D facial model based on the performance capture. Importantly, we are not replacing human performers, but rather optimizing how we process the data from these live captures. With Mockingbird, animation work that would have taken hours can now be completed in a fraction of a second. We have already seen the teams at Naughty Dog, San Diego Studio, and other adopt the tool, including in released titles like Horizon Zero Dawn Remastered. Another example is a tool we built for animating hair. This is often a labor-intensive process given the volume of strands that must be created. Our teams have accelerated this process by taking videos of real hairstyles and having an AI tool output a 3D model with hundreds of strand models. These practical applications allow our teams to spend less time on manual, high-effort task, and to instead reinvest their time into building richer worlds and gameplay for our players. AI tools in the hands of our teams will enable not only efficiency, but also new types of experiences for fans. For example, Gran Turismo's AI-powered racing agent, Sophy, has added a level of competitive gameplay for even our most seasoned drivers. Taking this further, our world-class creatives have already shown the ability to create amazing prototypes where NPCs with their own personalities can create a living, dynamic world for the players to explore. As AI capabilities evolve, the role of our creators will remain unchanged. The vision, the design, and the emotional impact of our games will always come from the talent of our studios and performers. AI is meant to augment their capabilities, not to replace them. AI is also already a part of our platform business. To take one example, over the last three years, AI-powered tools ensure the transactions were routed efficiently over the payment networks, generating over JPY 700 million of incremental revenue. We are building on this success with ongoing projects that will use machine learning to provide the best value possible to our customers. As AI brings more choices to players than ever, the value of our platform will lie in its ability to recommend and personalize at scale. We've already seen how AI models can outperform manual curation, and this will continue to improve. Our AI capabilities will evolve into a consumer-centric experience that not only suggests the next game a player might enjoy, but also the next gameplay moment, subscription, accessory, or merchandise that best reflects their passion. Beyond the store, our recently updated PlayStation Spectral Super Resolution, available on the PS5 Pro, uses machine learning to enhance image clarity, delivering 4K visuals at high frame rates. With PSSR, games like SAROS and Ghost of Yōtei have never looked sharper. Through our investments in AI and machine learning, we will continue to push the fidelity frontier forward. We believe AI will unleash the creativity of our studios, power a more curated platform, and enhance the PlayStation experience for both players and creators. With our global player base, deep library of IP, and integrated ecosystem, AI is a powerful tool for us to deliver a truly cutting-edge entertainment experience. Thank you, Nishino-san. I would like to now turn to our Imaging & Sensing Solutions, I&SS business. Sony's image sensor have evolved as electronic eyes that accurately capture the real world, driven by our relentless pursuit of fundamental advancement that go beyond competing on specifications alone. Our number one priority is to deliver the best possible imaging experience for our customers. To do so, we scrutinize and optimize every aspect of the sensor from the pixel structure, stacking and layering technologies through to the circuitry processes and final packaging. Sony possesses deep expertise cultivated over many years in the analog domain, spanning design, development, and manufacturing, together with our comprehensive ability to integrate and refine these elements as a whole. This is our competitive strength, and it's not something that can be easily replicated. Starting from our core mobile applications, we are developing higher density by advancing process technologies with enhanced fabrication precision together with stacking technologies to further improve performance. At last year's Corporate Strategy presentation, I discussed our direction for pursuing growth in the I&SS business and improving profitability with a strong focus on financial discipline. As part of that effort, today we announced the signing of a non-binding memorandum of understanding with TSMC to form a strategic partnership for the development and manufacturing of next-generation image sensors. Under the proposed partnership, we intend to establish a joint venture with Sony being the majority and controlling shareholder to set up development and production lines in Sony's newly constructed fab in Kōshi City, Kumamoto. As part of our partnership, we intended to explore emerging new opportunities in physical AI applications, such as automotive and robotics, paving the way for future growth innovations and expanding technological advancement. I would like to close today by addressing the technological and geopolitical disruptions which together have greatly impacted international supply chains and drastically upended traditional ways of doing business around the world. One such technological disruption is the current memory shortage, which is being driven by surging AI infrastructure demand and is impacting entire industries, including gaming, smartphones, laptops, memory cards, and other products. Our businesses are managing this issue very carefully. SIE will be able to contain the negative impact of increased memory cost in the current fiscal year and is engaged in ongoing negotiation with suppliers to meet the demand beyond the current fiscal year. In our I&SS business, while the volume-driven, low-end smartphone market is impacted by the rising cost of memory, our main customer base and demand in the high-end segment remains strong. We will continue to monitor and proactively manage the situation, and you will hear more about this in our upcoming earnings presentation. Looking ahead, we are optimistic about the environment in which we are operating and the strengths and diversity of our businesses and employees in driving continued success for Sony. At the same time, we are very aware of the seismic changes taking place in the world in which we all live and work. With ongoing unrest in the Middle East and unpredictable shifting tariff pressures, we are navigating a period of geopolitical complexity that present us with new challenges and uncertainty across market, partnerships, and supply chains. In this environment, adaptability will be crucially important. We cannot rely on assumptions that have supported us in the past, and we remain ready to pursue innovative ways of finding growth in the future. Thank you. I will now hand the meeting over to Lin Tao. Hello, everyone. Today, I will explain the content shown here. Sales of continuing operation in FY 2025 increased 4% compared to the previous fiscal year to JPY 12,479.6 billion. Operating income increased 13% to JPY 1,447.5 billion, both record highs. Net income decreased 3% to JPY 1,030.9 billion, primarily due to the absence of a decrease in tax expense from the dissolution of a subsidiary recorded in the previous fiscal year. The financial results by segment are shown here. When you look at the factors causing the change from our February forecast for operating income, you can see that we recorded approximately JPY 190 billion in items not included in our previous forecast, including impairment losses on assets at Bungie and Pixomondo, as well as losses related to the downsizing of the business of Sony Honda Mobility. Excluding these items, operating income significantly exceeded our forecast overall, primarily due to an increased profit in G&NS and I&SS segment. Our consolidated results forecast for FY 2026 is sales of JPY 12,300 billion, operating income of JPY 1,600 billion, and net income of JPY 1,160 billion. We expect operating cash flow to be JPY 1, 500 billion. The results forecast for each segment is shown here. Now, I will turn to an overview to each business. First is the G&NS segment. In FY 2025, sales were essentially flat year-on-year at JPY 4,685.7 billion, as the decline in PS5 hardware sales was offset mainly by foreign exchange rates and higher revenue from network services and third-party software. Operating income increased 12% year-on-year to JPY 463.3 billion and reached a record high for the segment, primarily due to a higher sales and the positive impact of foreign exchange rates despite the impairment of assets at Bungie. Excluding the JPY 138.4 billion in one-time items, operating income increased 45% year-on-year. For FY 2026, we forecast sales of JPY 4,420 billion and operating income of JPY 600 billion. Compared to the result of FY 2025, excluding one-time items, this operating income forecast is essentially flat year-on-year. That is because we have incorporated an increase in investments of the next generation platform in the FY 2026 forecast. Excluding these factors, we expect steady double-digit growth in the profit generated by our current business. The number of monthly active users across the PS platform in March increased 1% compared to last March to 125 million accounts, a record high. Total playtime in the fourth quarter, ended March 31st, 2026, increased 1% compared to the same quarter of the previous fiscal year with user engagement remaining solid. Cumulative PS5 unit sales as of the end of March exceeded 93 million. This expanded install base contribute to stable profits from software and network services. We plan to base our PS5 hardware sales in FY 2026 on the volume of memory we can procure at reasonable prices. We expect hardware profitability to be essentially the same as FY 2025. If circumstances change going forward, we plan to manage the impact on profitability by flexibly adjusting, among other things, unit sales and promotional plans. In our Studio Business, earnings from Bungie's title portfolio did not reach our expectations, so we downwardly revised our business plan and impaired the full amount of the fixed assets related to Bungie except for goodwill. Player receptions to Marathon is strong, with the game receiving a Metacritic score of 82 and more than 90% of the player reviews on Steam being positive. Engagement metrics such as retention also remain at a high level. Going forward, we aim to improve the performance of the game by working to retain highly engaged core users through the introduction of additional content, further improvements in the gameplay experience, and expansion of the user base. We have many appealing first-party titles scheduled in FY 2026, including SAROS, released in April, and Marvel's Wolverine, slated for release in September. We expect the contribution to earning of first-party titles to exceed FY 2025. Next is the Music Segment. In FY 2025, sales increased 15% year on year to JPY 2,120.1 billion. Operating income increased 25% year on year to JPY 447 billion, primarily due to the impact of the higher sales and the revaluation gain recorded in connection with the acquisition of an additional equity interest in Peanuts Holdings. Even when excluding these one-time items, operating income reached a record high. For FY 2026, we forecast sales of JPY 2,140 billion and operating income of JPY 400 billion. Excluding one-time items, we expect the amount of operating income to be at the same level as the previous fiscal year, primarily because growth in streaming revenue is expected to be offset primarily by the absence of the prior fiscal year hit title, Demon Slayer: Kimetsu no Yaiba – The Movie: Infinity Castle. In FY 2025, US dollar-basis streaming revenue increased 9% year-on-year in recorded music and 14% in music publishing. We expect the mid to long-term average growth rate of the music market to be in the mid to high single digits, and we intend to continue to invest in high-quality music catalogs going forward with the aim of growing stable earnings. Due to the release of Michael, a biopic about Michael Jackson, sales at SMG have increased due to a significant increase in streams of music by Michael Jackson, whose music catalog SMG jointly owns. We expect that streams in other countries will also increase as the film is released theatrically around the world, including in Japan. Next is the picture segment. In FY 2025, sales were essentially flat year-on-year at JPY 1,499.3 billion because lower revenue from theatrical release films was offset primarily by increased Crunchyroll revenue resulting from higher paid subscribers and the hit Demon Slayer. Operating income increased approximately 13% year-on-year, excluding the impairment losses on the asset of Pixomondo, which operates VFX and virtual production business and related shutdown costs. Including these factors, operating income decreased 11% year-on-year to JPY 104.9 billion. For FY 2026, we forecast sales of JPY 1,630 billion and operating income of JPY 145 billion. At SPE, we are continuing to work to create and strengthen franchises by adapting appealing fan-supported IP into films. Recently, SPE and PlayStation Productions announced the film adaptation of Bloodborne game IP owned by SIE and preparation of the film adaptation of Helldivers have begun. We plan to release Spider-Man: Brand New Day in July 2026 and Jumanji: Open World in December 2026. The trailer for Spider-Man released in March surpassed 1 billion views in the first four days after its release, a record high in the film industry, reflecting exceptionally strong anticipation from fans worldwide. Next is the ET&S segment. In FY 2025, sales decreased 6% year-over-year to JPY 2,260.5 billion, and operating income decreased 17% to JPY 158.6 billion, mainly due to the impact of lower sales. For FY 2026, we forecast sales of JPY 2,250 billion and operating income of JPY 150 billion. Market conditions in Q4 trended essentially in line with our February forecast despite geopolitical risk in various regions and concerns about a macroeconomic slowdown. The financial results for the segment and our inventory level were also essentially in line with our forecast. In this segment, we expect to contain at approximately JPY 30 billion the impact of the increasing memory prices on our FY 2026 forecast through procurement, design, and sales actions in various regions. If memory prices deviate from our current assumptions going forward, we aim to maintain profitability by flexibly adjusting our sales strategy within the eye on foreign exchange rates and the competitive environment. At the end of March, Sony entered into definitive agreement with TCL regarding a strategic partnership in the home entertainment field. Based on the memorandum of understanding we signed in January, the definitive agreements codified, among other things, an outline of a new JV that will operate the business, the business domain covered by the JV, the enterprise value of the business in question, and the consideration to be paid for the transfer. The JV is scheduled to commence operation in April 2027, and we have incorporated approximately JPY 20 billion of expenses in the FY 2026 operating income forecast, including project implementation costs necessary to execute the partnership, system migration costs, and personnel-related costs. Excluding the impact of these expenses and the impact of memory market conditions I mentioned earlier, we expect FY 2026 operating income to improve across our business led by the imaging business. Last is the I&SS segment. FY 2025 sales increased 20% year-over-year to JPY 2,151.5 billion, mainly due to higher average selling prices and higher unit sales of mobile sensors. Operating income increased 37% year-over-year to JPY 357.3 billion and reached a record high, primarily due to the impact of the higher sales despite the recording of one-time restructuring costs, including losses on the sales of our equity interest in an overseas subsidiary and asset impairments. In FY 2026, we forecast the sales of JPY 2,070 billion and operating income of JPY 400 billion. In Q4, the impact of memory market conditions gradually became more apparent in the smartphone market, especially in the low end. Our mobile sensor sales exceeded our forecast, primarily due to strong shipments to our major customer. In FY 2026, we're taking a cautious view of the growth of the sensor market due to our view that the trend towards larger-sized sensors for smartphones will moderate, and the uncertainty regarding the impact of memory market conditions will remain. As a result, we have incorporated into our FY 2026 forecast a slight year-over-year decrease in the overall sales of mobile sensors. Given this operating environment, we plan to emphasize efficiency when managing our business in FY 2026, including through fixed cost control and yield improvements. In FY 2025 Q4, we increased our effort to address low profitability business compared to our initial plan, and we have reflected the benefit of those efforts in our FY 2026 operating income forecast, which is essentially flat compared to the previous fiscal year if restructuring costs are excluded. In our next Mid-Range Plan period, we expect sales of this segment to return to growth, driven by a renewed acceleration towards larger-sized sensors. During FY 2026, we intend to establish the infrastructure necessary to support this growth, and we plan to make thorough preparations. As explained earlier by Mr. Totoki in the corporate strategy part, Sony and TSMC have today entered into a memorandum of understanding to pursue a strategic partnership for the development and manufacturing of next-generation image sensors. This partnership aims to significantly enhance the future technological competitiveness of image sensors, including through increased density by combining the advanced design expertise of Sony, a leader in the image sensor industry, and the process and manufacturing technologies of TSMC, which boasts the world's largest semiconductor production scale. From a financial perspective, we believe that this partnership will improve the cash flow of the I&SS business, reduce invested capital, and improve profitability by lowering investment in production facilities and mitigating equipment procurement costs. Furthermore, we anticipate that this partnership will increase the flexibility of our capital allocation across the Sony Group. Now, I will explain the impact on our consolidated results of the discontinuation of the launch of Sony Honda Mobility's EV model and the downsizing of the business, which we announced in March. As a result of the discontinuation Sony Honda Mobility expects to record additional losses in FY 2025 and FY 2026 resulting from items such as asset impairments and compensation payments to business partners. We account for Sony Honda Mobility under the equity method, and we recorded an additional JPY 44.9 billion loss in all others in Q4 based on our share of the business. We have incorporated JPY 30 billion of additional losses in our FY 2026 results forecast, but a portion of that amount is expected to be offset by a decrease in running costs due to the downsizing of Sony Honda Mobility's business. In FY 2025, the G&NS Music and I&SS segments, the profit growth driver of Sony Group, achieved record high profits and business momentum remained strong. In FY 2026, we expect the profit-generating capability of each of our business to further improve compared to the previous fiscal year, despite the uncertain business environment. We think that we have been able to demonstrate the high level of resilience of our business portfolio. Finally, I will explain the progress of our fifth Mid-Range Plan. The group-wide financial targets under the current Mid-Range Plan are an average annual consolidated operating income growth rate of 10% or more and a three-year cumulative operating income margin of 10% or more. Based on the FY 2026 operating income forecast presented today, we expect the average annual operating income growth rate to be 16% and the three-year cumulative operating income margin to be 11.7%, both exceeding our targets. Regarding capital allocation for this Mid-Range Plan period, we revised our forecast for three-year cumulative operating cash flow, our primary source of funds, from JPY 4.8 trillion- JPY 5.7 trillion, considering the previous fiscal year results. In the Mid-Range Plan, strengthening shareholder return is one of our key initiatives. We plan to allocate the additional capital primarily to higher shareholder returns. For FY 2026, we have established a share repurchase facility of JPY 500 billion. We also intend to accelerate the pace of dividend increase, raising the annual dividend amount JPY 10 from the previous fiscal year to JPY 35. This concludes my remarks. That was a presentation from Totoki, Nishino, and Tao. The media QA session will begin at 4:55 P.M., and the investors and analysts QA will begin at 5:15 P.M. Each Q&A session is scheduled to last approximately 20 minutes. For those who have registered to submit questions in advance, please click the Join Webinar link and wait for a while. Please review the invitation letter sent in advance for details on how to ask questions and points to be noted. We ask for your indulgence while we wait for the session to begin. Thank you for waiting. We'll be starting the media Q&A shortly. Please wait moment. We will start momentarily. Thank you for waiting. We would now like to begin the Q&A session. Those on stage are Hiroki Totoki, President and CEO. Lin Tao, CFO, Corporate Executive Officer. Hirotoshi Korenaga, Senior Vice President in charge of accounting. Naoya Horii, Senior Vice President in charge of Corporate Planning and Control. We will take questions from the media. Those who have questions, please click the WebEx Raise Hand button. Please limit your questions to two. Please begin. Nihon Keizai newspaper, Yoshida-san, please ask your question. Yoshida-san, do you hear me? Yes, I am Yoshida from Nikkei. Do you hear me? Yes, we do. I have two questions. The first question about the establishment of the joint venture with TSMC, which was just announced. In the equity market, the low synergy with the entertainment area, the possibility of spin out has been pointed out. Sony, this MOU agreement is based on Sony being the major or controlling shareholders. I would like to hear the background. I would like to hear from Totoki-san about the stock prices. With the surge of the semiconductor memory prices, and not seen as an AI title, the stock prices have been going down these few days, and the stock prices has not really made a rebound. Based on what you have just explained, do you think you now have a good explanation to the market? Thank you for the questions. About the joint venture establishment with TSMC, our I&SS business, the possibility of spinning that out, we have never talked about that openly, though that was a speculative story. What we have been saying about I&SS is this burden of CapEx. To reduce the burden of CapEx and increase profitability at the same time need ingenuity, and I have been saying that a number of times. Last fiscal year, I talked about the fab-lite strategy, which we want to pursue. The JV with TSMC is the first step towards this fab-lite strategy. Up till now, we have been an IDM, doing the, from the development and research of image sensors to the fabrication. In the future, we want to work with partners in the manufacturing or fabrication. That's why we have signed this MOU with TSMC. What we announced today is in alignment with what we have been saying until last year. The second question about the share prices. Rather than being unique to Sony, I think this really pertains to the entire sector. First is the shortage of memories. That's why growth is really might be inhibited, and also, there might be a deterioration in the cost structure. That is the first point. With the advancement of AI, generally speaking, the entertainment industry Content production become easier with AI, leading to an increased number of content in the market. We will be taking competing over the user's time. There might be anxiety that the entertainment business cannot grow as before. What we have explained today, explained our stance towards the situation and what we are working on and what we have achieved so far. We have given the direction. Having said that, AI itself will continue to grow very quickly, and I think new business models will also come up. We need to be able to respond flexibly to the all developments. The market perspective is not something that we can change by ourselves. As we have been doing up till now, we will try to give a highly high resolution and high quality information. Thank you. All right, we will take the next question. From NHK, Tamura-san, please. Tamura-san, can you hear us? Yes. Can you hear me? Yes, we can hear you. Thank you. From myself, I'd like to ask about the business you have in the U.S. You had alluded to about the adaptability from the CEO, Totoki-san. In the U.S., there has been the tariffs. 10% tariffs, it has been decided that it is illegal, in the U.S. there is uncertainty regarding the direction of the tariffs. About the Trump administration's tariff business, how do you see it? Especially after this court judgment about the tariffs. Thank you for the question. As you have alluded to, this reciprocal tariffs, yes. The stance for that and how do we see into the future is quite difficult to say, and the uncertainty has increased. From our side, we can say that our external activities about the intelligence, we will do as early as possible to get the accurate as possible information, so that we can have the foresight, insight into the future. We'll take quick action, we repeat such response. Having said that, even if we foresee, the assumption is that is only for the short term, and it changes quite rapidly. That is the geopolitical situation that we are in now. As much as possible we will not be too much decided by what we think is right now, but we'll be quite flexible in getting to this issue. Next question, please. Nikkei Business. Iwata-san, please. Thank you. Can you hear me? two questions. About the joint venture with TSMC. I think that the logic will be TSMC and others, and Sony will be doing the images, and Sony will be finishing up. The pixel part, I think that your capability, differentiating capability would be the image capability. I think that you have been constantly talking about the difficulty of having very precise images and fabrication precision. With joint venture, I think, is there not such concern that this will be a challenge? What is your expectation towards this joint venture? Is it financial expectation or others? That's my first question. The second question, about AI and the increase in contents, and it will be a race against others in terms of capturing the user's time. LBE, another entertainment experience. I think that this in itself is also important in terms of capturing the user's time. It's not just LBE, but other new entertainment experience. What is your take on this currently? Thank you. Well, about the joint venture with TSMC. Well, up until now, we have been doing the pixels and TSMC was doing the logic. Well, about the pixels too, I think that this requires development capability and process technology. These are two separate things. Well, like IDM, we have tried to integrate this horizontally, vertically. With this TSMC joint venture, what will be strengthened is that we'll have a world top-class semiconductor process technology. Because of TSMC's capability, I think this will be a major evolution on our part. Another thing is that as a result, there'll be a greater scalability towards the future. Well, image sensors, in order to supply image sensors in the past, we had to rely on the supply capability of our fab, so this was a limiter. In addition to mobile image sensors, physical AI, and the sensors will be playing a major role in physical AI too. Considering this future demand, we have to prepare ourselves, and therefore, this joint venture will have great significance on this front. Of course, TSMC also has this expectations towards future demand and capturing future demand through this joint venture. The financial impact is there, on the one hand, with TSMC, we want to secure a solid position as a number one sensor supplier. Please understand that this is what we're aiming towards. Another, about the competition of trying to capture the user's time with the increase in entertainment contents. LBE is a new entertainment experience engagement. Fun engagement will be deepened as a result of LBE. The technology needed for this, and the business model required is being promoted right now, and we are doing experiments, a POC on this front. Other, we are entering into partnership with different companies to promote this business model. That is the current status. Thank you. We would like to move on to the next question. Nishida-san, Freelance Journalist. Do you hear me? Yes. I have two questions. The first question, about Sony and Honda. This is depreciation, based on the equity method. This business will be changing due to Honda's. Do you intend to ask Honda to bear more burden? About, next is about memory shortage. There will be a big impact on gaming consoles and, for the entire industry, I think there might be a problem with supply, because the game consoles prices are going up. Maybe the PS5 will be fine, but looking at the coming 1- 3 years, the gaming console prices, how would that be impacted? Would you give us a breakdown on that? Thank you. Thank you for the question. About the first question about the joint venture of Sony/Honda. Of course, the revision of Honda's strategy was one big cause for this. However, the electric vehicles, the environment surrounding the EVs, have changed, especially in North America, and we fully understand that. The three companies discussed on who will be burdening what, so we made this comprehensive decision. SHM will not be claiming for any more damages to Honda. The numbers that we have told you today are definitive, more or less definitive. About your second question about the memory shortage, of course, the memory prices going up would increase the cost of the BOM, so the cost of manufacturing will go up. If that leads to passing on price, cost to prices, there would be a big impact on the gaming console prices. As we explained earlier, for calendar year 2026, the necessary volume has been secured. Another point, we have to a certain extent, agreed on the price itself. The console prices and promotion profitability. We would like to strike a balance on our promotion with our promotion budget, and that cost is already factored in. About the upcoming generation, future generations gaming consoles, we have not yet decided on at what timing we will launch the new console, at what prices. We would like to really observe and follow the situation. The memory prices, looking at the current circumstances, the memory prices, is expected to be very high, also in FY 2027, because there will still be a shortage in supply. Under that assumption, what can We will like to think carefully what we can do. How can we reduce the other costs of the hardware other than the semiconductor? Also, we might think of new ways of selling the product. we would like to think about, we will do various simulations, including changing business models to come up with the best solution and strategy. Having said that, even under this situation, we have 125 million active, monthly active users enjoying games on our platform. That itself is growing. It's not that the demand has gone down. I think we can think of ways to get through this. Thank you. Yes. Due to a limited amount of time, the next person would be the last question. From TV Tokyo, Sudo-san. Excuse me, Goto-san from TV Tokyo. Yes. My name is Goto from TV Tokyo. I'd like to ask Totoki-san, the CEO. That the price increase-- The PlayStation 5, you said that it is fine that you're not going to have the price increase. That's the first question. And the second question is about the expected business results. There is uncertainty in the geopolitical situation, but you would have the record high net profit. How do you assess the risk in the background? What kind of assumption do you have in order to make that record high net profit? Thank you for the question. About PS5, as we have said, we had just had the price increase so that for the next price increase, we don't have that in plan. We would keep this current price so that we would manage the business based on this current price. About the expected business, the uncertainty about that in geopolitical sense, yes, in a geopolitical sense. We have several factors that are uncertain, but we have the best estimation so that we would manage risk so that we would keep the forecast that we intend to make and in various ways so that we evaluate risk and we have policies against risk so that for the next year and this year also, that we have the record high profit. Keep on having the record high profit. Thank you. It's now time to end the Q&A for the media. For the investors and analysts, we would start at 5:15 P.M. 5:15 P.M. We'll be starting the investor analyst QA shortly. We ask for your indulgence. Thank you for waiting. We'd now like to begin the investor analyst QA session. I am Shinji from IR. I'll be emceeing this session. Those on stage remain unchanged. We'll begin the Q&A. Please click the Webex Raise Hand button when asking questions. Please limit yourself to two questions. BofA Securities, Hirakawa-san, please. Thank you. Hirakawa from BofA Securities. Two questions. The first about AI. Second is about mobility. First, AI. As you've explained, we've come to understand that platform will become more important in AI, and I think that this will appeal to people's emotion. For other areas like the piracy, might be piracy, but people who can enjoy to a certain extent with AI, such a market will exist. Disney, well, they dissolved this, but they tried to monetize with AI players. Sony, especially when it comes to AI, is it a possibility that you try to monetize by tying up with AIs? What is your position currently? That's my first question. May I continue? Yes. The second question about mobility business. In this mobility business, as Totoki-san has said, in the U.S., the environment surrounding EV vehicles has changed significantly, and from smartphone to mobility. I think that this is still effective. In the future, well, AFEELA might be discontinued, but I think there might be future opportunities. This Sony Honda Mobility, this experience, how can you leverage on this going forward? Thank you. About your first question, using AI, what kind of monetization can we do? We, on our part, have been undertaking different initiatives. On this front, we need to think about partners and it might be difficult There might be pushbacks for us to reveal everything that we're doing to our partners, and therefore, we have to be careful in addressing this issue. Therefore, for example, like Disney, tying up with AI players and monetizing. If you ask if we are not thinking of any such things, we understand that there are different options available, but it's not a specific player that we have in mind. Instead, we are thinking of different types of AIs that can provide service. We want to tie up with different types of AIs going forward. If we specify a specific player to work with, it might be appealing to a certain extent, but on the other hand, this might confine our action. We want to have a good balance. That is our current thinking. About mobility, as you say, our biggest challenge is SDV, Software-Defined Vehicle. The way of producing cars has changed significantly, and what can we do in this context was the motivation to start this joint venture. Autonomous driving will become possible in the future. The indoor of the vehicle will have a value as an entertainment space. We wanted to do different experiments to this end. The knowledge we acquired here is valid. Well, the way of making cars, well, it's not the distant future, but I think will change significantly, and the users' demands will also change. The people who've acquired this experience between Honda and Sony, they will return to their co-companies, and we want to leverage this talent and think about how we can use this asset that we have with us. I think that the people who have gone through this experience should be actively leveraged within our group. I want them to play an important role within our group. In the future, in various ways, we want to engage with mobility. That is all. Thank you. Thank you. We would like to now move on to the next question. JP Morgan Securities, Ayada-san, please. This is Ayada from JP Morgan Securities. I also have two questions. The first question is about Game & Network Services. What is the long-term growth upside, what is Totoki-san's view on the growth upside of Game & Network Services? Profit is going up, but maybe the MAU is struggling to grow, and also, the first-party is also fluctuating year by year. If the profitability is to increase in the long term, what are the factors supporting that? Do you think MAU will still grow in emerging countries? As you said in the presentation, if the platform engagement goes up with AI, maybe that would increase the ARPU. Are there other things you can do in the first party game area? Please tell me about the upside of gaming. Next is about catalog investment on music business. Compared to other major players, you have been very active in investing in music catalogs. In the catalog investment market, AI, there's a risk of AI-generated music. This trading market, the valuation of the catalog in this market, what would be the impact on that? If you have any take on that, please share with us. Is the valuation going up or down, or is there no impact here? Based on this, you also told us that you will be actively investing in catalog going forward. Would AI, spread of AI, give an impact on your stance on this investment? Thank you for the questions. About the first point, the long-term future upside of G&NS, Game & Network Services. That was a long-term question, I would like to explain from the long-term perspective. Myself, I believe we need an evolution in the gaming content. Maybe, I think there's a high possibility that AI will bring about this evolution. Why I think so? The gaming industry is becoming very mature, and the large portion of the market share is really relying on large franchises of major publishers. Before COVID, Fortnite came into the market. It was a large-scale live service game. That was a very innovative event in the industry. For the entire gaming industry, Fortnite was surely a tailwind. For the entertainment market, novelty is extremely important. When we talk about large franchises, they are spending like JPY 50 billion on AI, and they will be developing games, and this will take 5-6 years, the number of titles will be limited. It will be very risk, it's very difficult to take risk. However, if the bar goes down, there will be more possibility of new games coming up, that would lead to the industry becoming more active. Of course, there's a flip side. There might be some disruption, that might be a concern too. This new wave and innovation, I think, will lead to the further expansion of the market. This is what I believe. How can we grasp this opportunity, and what kind of business model should we develop to respond to that? Really grasping this opportunity is something that we need to do, the most important thing. About your second question, about the music catalog. The Gen AI. AI-generated titles have come into the hit chart. The percentage, overall percentage, of AI-generated music is still very low. When we talk about catalogs, for evergreen catalogs, we don't think the prices of evergreen catalog titles are going down, so they are still very popular as investment targets. The pieces, music pieces generated, composed by AI, would they compete against evergreen catalogs? I don't think that is really conceivable. The reason being, the evergreen catalogs are based on individuals' experience. They are really listened to for a long period of time, and these listeners go to live music performances, and that is something which AI cannot offer by itself. However, AI's advancement is extremely fast, so we need to be able to respond very flexibly to such changes. What kind of business model should we develop so that we can increase our resilience? Maybe you remember that at one time, there was strong focus on distribution and music DIY platform for distribution was really debated, very actively. Back then, the label service were seen to disappear. That seen as disintermediation. That has not happened. Back then, we acquired a DIY platform company while holding a label service. We were building such platform at the same time. The insight this offers is very important. What business model? Not only protecting the existing businesses, we need to really go and grasp the new opportunities. Thank you. That was all. Thank you. Next question from SMBC Nikko Securities. Katsura-san, please. This is Katsura from SMBC Nikko Securities. I have two questions about capital allocation and I&SS. The first, about the capital allocation. Well, the strategic investment in the two years' time, what has been the level of a strategic investment? In the environment, how do you see that in the entertainment business? The multiple is going down across the industry, but there is another view that there is opportunity. Your stock price is going down drastically, so that capital allocation is going up. But CFO Lin Tao has said that that is going to be given back to the shareholders. How do you think about that? That is the first question. For the Mid-Range Plan, this is the last year of the Mid-Range Plan. From yourself, can you tell about what you think for the next Mid-Range Plan? The second, I&SS and TSMC joint venture. From the METI announcement, JPY 80 billion investment subsidy. I think that was the number. For the semiconductors, the business surrounding the semiconductors is a national security kind of a challenge and against such background. How do you think about that? With the TSMC, you have the joint venture and I think it is a good combination for giving up the share, but the profitability. You have not gone past the past peaks. In the mid to long-term range, how do you think about it? That's the second question. Thank you very much for the question. About the capital allocation, CFO Lin Tao would answer, I would follow up with that. About the second question, I would be answering that. I'll ask our CFO Lin Tao to answer. About the strategic investment in the Mid-Range Plan, JPY 1.8 trillion frame has been set. As of now, they already decided about JPY 1 trillion, a little bit over JPY 1 trillion level we had already implemented. JPY 1.8 trillion, a strategic investment frame, we have not changed that. We are giving back to the shareholders so that the capital allocation. The operating cash flow capability is higher now than the past. We are having the strategic investment, but we can also give back to the shareholders. Return to the shareholders. I think we have that kind of a power now. About the next Mid-Range Plan, how do we think about it? The next Mid-Range Plan, well, we are now working on that, so I don't think we can say anything in a concise way. About the geopolitics, we had discussed, but those conditions change very rapidly, so that we cannot say anything certain now. One thing we can say is that until now, we had implemented various investments and how we had fared with that. Some went well, some did not go well. From this, results, we can have the lessons learned, and we would have the rational price. For those investments that we like to continue with. Based on that, if we can have free cash flow that generated, that is our mission, to generate more free cash flow, having invested in the strategic areas, and then to return to our shareholders. About the joint venture, and in the geopolitical situation about the national security and economic security. With TSMC, in Japan, TSMC is having the attractiveness to expand in this country, Japan. That's how I see it. From that kind of a perspective, also in the extension of that perspective, I think this joint venture had come about. As you have understood, TSMC is not a company that likes to have joint venture, and TSMC would like to control themselves. That has been their style up until now. In various ways, the joint venture that we have with us is giving us various opportunities. For TSMC as well, it's going to be a big challenge. That's how I see it. As Sony, we would like to take this opportunity to have a fruitful outcome. About the ROIC, it's good, but the profitability is not so good. Was that the question? The fixed cost or the variable cost, I think that's the difference. Well, I think, with the variable cost, then the margin go down. That is right, so as you have said. The risk would go down as well. In a sense, it's a trade-off. In this trade-off, to have the optimal answer, and as a total, we want to not squeeze the margin, but to get, lessen the burden of investment. That's the basic way of thinking from us. Thank you. Thank you, Katsura-san. We are running short of time. The next questioner will be the last. Please limit your questions to one. Nakane-san from Mizuho Securities, please. Thank you. Nakane from Mizuho Securities. I have one question. All right. Well, about your activities to improve operation. For example, about R&D. Last time it was JPY 760 billion versus JPY 700 billion this fiscal year. What is the change, and how are you trying to optimize? Can you explain? I think that in the different business segments, similar things are happening. For example, pictures, ROIC is low, and also game, where the demand environment is changing. I think operation optimization is being carried out. It's difficult to see from outside. It would be, the, SG&A or any improvements, that you're seeing and, what you would like to do going forward, and any typical examples that you can share with us, please. Thank you. About R&D expenditure. Well, that is the question that you've asked. We have to think about the R&D themes from a cyclical point of view. The environment is changing, our business direction is changing. In line with that, R&D needs to change to be aligned. I think over the past two years, we have focused on this and scrutinized what is being done. As a result, even if we take on a long-term perspective, this R&D, we saw that competitiveness could not be maintained, or we did not see an exit from this group. For such items, we try to review and based on that, we have put together next fiscal year's budget. Please take it as is. This is a result of scrutiny. Also, the different initiatives being taken for, at, the low ROIC business, what we're going to do about that. We do have discussions to that end, but within different businesses and industries, it's difficult to just compare based on ROIC. If you compare yourself to other companies, we could say that our ROIC or margin is inferior. If we see that that is the case, we understand we have to take measures. For example, structural reform. We have not made announcements, but in different business segments, we are constantly carrying out structural reform. We overall try to maintain our competitiveness and boost our profitability. As for KPIs, it's difficult to say, but as for ROIC, for each segment, we have the ROIC numbers. This has been disclosed. I hope that you refer to those numbers. That is all. Thank you. Thank you very much. It's time for us to end. We would like to thank you for taking part in our presentation today. Once again, thank you very much for your attendance.