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This summary is based on the second quarter fiscal 2007 earnings call conducted by Sony Corp. (SNE) on October 25, 2007.

Management:

Senior Vice President of Investor Relations: San Levenson
CEO, EVP and CFO: Nobuyuki Oneda
Group Executive, Corporate Development and M&A: Robert Wiesenthal

Key Investors Issues

- Revenue was up 12% to ¥2.1 trillion, while income rose ¥73.9 billion.
- The European Commission reaffirmed its 2004 decision that the merger of the Sony and Bertelsmann''s recorded music businesses does not pose a threat to competition in America.
- An interim dividend of ¥12.5 per share was declared.

Year-to-date Highlights:]

- Sales increased by 12.4% from ¥3.6 trillion in 2006 to ¥4.1 trillion.
- Net income rose by 300% to ¥140 billion or ¥133.22 a share.
- Cash and cash equivalents strengthened from ¥555 billion in 2006 to ¥627 billion.

Second Quarter Highlights

Consolidated sales rose 12%, from ¥1.85 trillion in the prior year, to ¥2.1 trillion, driven by strong sales gains across all segments except financial services.

- Electronic segment sales increased 20.7%, to ¥1.7 trillion on strong sales from products such as Bravia LCD televisions, VAIO PC’s and Cybershot Digital cameras, despite declines in sales for LCD rear projection televisions.
- In the Game segment, sales were up 42.9% to ¥243 billion, driven by Playstation 3, which was released during the period.
- In the Pictures segment, there was a 6.4% increase in sales from ¥178.2 billion in 2006 to ¥189.6 billion as a result of higher sales of theatrically released and made for television movies.
- Revenues in the Financial Sevices segment were down 6.3% due to a deterioration in net gains from investments in the separate account and in net valuation gains from convertible bonds in the general account at Sony Life.

Operating income of was ¥90.5 billion compared to a loss of ¥20.8 billion in 2006 due to increase losses in the games segment.

- Restructuring charges, which are recorded as operating expenses, amounted to ¥18.5 billion, up from ¥5.3 billion in 2006.
- A ¥60.7 billion gain on the sale of the site of the former headquarters is included in the operating income
- In the Electronics segment, operating income increased due to a ¥51.2 billion provision recorded in 2006 for charges related to recalls by certain notebook computer makers and the subsequent global replacement program.
- Non-operating income improved ¥2.7 billion to a ¥2.5 billion loss due to the recording of the foreign exchange gain, compared to a foreign exchange loss in the prior year, despite an increase and loss on devaluation of securities investments.
- Equity and net income of affiliated companies increased 7% year-on-year to ¥21.1 billion, with Sony Ericsson contributing ¥21.1 billion, down ¥700 million from the prior-year period.

S-LCD, the joint venture with Samsung, contributed a loss of ¥500 million, over ¥3.4 billion lower than last year due to its investment in 8th generation equipment.

- SONY BMG, the joint venture with Bertelsmann, also contributed a loss of ¥500 million, which is an improvement of ¥1.8 billion from 2006.
- As a result, net income improved from ¥1.7 billion or ¥1.60 a share in 2006 to ¥73.7 billion or ¥70.09 a share.
- An interim dividend of ¥12.5 a share was declared and is payable on 3 December 2007.

Performance of Segments:

- In Electronics there was a decrease in the sales of LCD rear-projection televisions due to a shrinking market, though intersegment sales increased as a result of sales of PS3 semiconductors.
- Operating income in electronics was rose 13 times from ¥8 billion in 2006 to ¥107 billion, as a result of provisions, the global replacement program, increase in sales and positive impact from the depreciation of the yen against the dollar.
- The largest profit generating products were, in order of magnitude, digital cameras, video cameras, system LSI, PCs and broadcasting professional equipment.
- In the TV and semiconductor categories, overall sales were ¥307 billion, an increase of 20% from the prior year.

Operating losses amounted to ¥21 billion, ¥11 billion lower than last year due to impairment losses against certain assets.

- LCD TVs continue to be impacted by price, however, the firm introduced new large screen and full HT models in Europe, Japan and Asia.
- In semiconductors, overall sales were ¥225 billion, up 59% from the prior year, resulting in operating income of ¥24 billion due to the sale of chips for the PS3.
- Sony Ericsson''s sales increased 7% to EUR3.108 million, as unit sales rose by 31% to 25.9 million, following robust performance from Walkman and Cyber-shot phones.
- Sony Ericsson gained a percentage point of market share over the past year and finished the quarter at over 9% share.

- In the game segment sales increased 43% from ¥170.3 billion in 2006 to ¥243.4 billion, with the bulk of sales coming from hardware and accessories, while the rest came from software.
- Hardware sales increased due to an increase in unit sales, though PS3 contribution to sales was below original expectation.
- The company launched a new lighter, slimmer PSP model in Japan, in the U.S. and Europe in September and penetration is gaining speed with September unit sales in Japan reaching a record high.

Towards the holiday selling season, the firm will accelerate the expansion of the PS3 platform through enhancement of the software line-up, and proactive measures aimed at expanding sales