Question · Q2 2026
Katsura from SMBC Nikko asked about the sustainability of the GNNS segment's high Q2 operating income (15.3% excluding impairment) without major titles, and the contributing factors. Katsura also inquired about the potential negative impact of increasing NAND flash prices on PS5 hardware profitability for the remainder of the year and next fiscal year. For the INSS segment, Katsura asked about balancing business expansion with investment efficiency and updates on midterm plans regarding geopolitical risks and U.S. production.
Answer
Lin Tao, CFO, Corporate Executive Officer, attributed GNNS's Q2 profitability to Forex, Network Service, and reduced M&A expenses, stating sustainability depends on strong network service and first-party software performance. For memory prices, Lin Tao confirmed parts for this fiscal year are secured, but future price increases could impact hardware profit, with a focus on monetizing the existing 18 million PS5 install base next year. Naoya Horii, Senior Vice President in Charge of Corporate Planning and Control, Disc Manufacturing Business, and Storage Media Business, addressed INSS, noting good management of expenses for sales growth and continuous exploration of options like joint investments to address U.S. production and geopolitical risks.
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