Sony Group Corp. will unveil the growth strategy for its financial services unit on Thursday, as the Japanese conglomerate prepares for a long-anticipated spin-off that has been welcomed by investors and analysts as part of the company’s broader transformation.
Once famed for its consumer electronics, Sony has steadily pivoted towards entertainment and technology. Entertainment now accounts for over 60% of the company’s total revenue, a shift that has earned widespread praise and boosted investor confidence.
The upcoming spin-off marks a new chapter in Sony’s evolution, coming just four years after it fully acquired Sony Financial Group in a $3.7 billion deal. The company plans to distribute more than 80% of its shares in the financial services unit—which includes banking and insurance—to existing shareholders through dividends in kind.
The move also marks Japan’s first partial spin-off to utilize a 2023 tax reform and will be the country’s first direct listing in over 20 years. Unlike traditional initial public offerings (IPOs), a direct listing allows a company to enter public markets without issuing new shares.
Sony said the separation would help clarify the differing capital strategies of its businesses: the financial arm, which grows by accumulating capital, and the rest of the company, which focuses on asset and capital efficiency. Executives argue the spin-off will enable a large-scale reorganization with relatively low risk.
“The partial spin-off has finally become tax-free, aligning with Western practices and giving an option for large Japanese companies to shrink their conglomerate discount,” said Hideki Somemiya, CFO of materials manufacturer Resonac, which is also planning a spin-off.
Sony will retain a stake of just under 20% in the financial business, which will continue using the Sony brand under license.
Beyond finance, Sony remains committed to expanding its entertainment footprint—spanning video games, film, music, and anime. It also plans to maintain its lead as the world’s top producer of image sensors used in smartphones.
CEO Hiroki Totoki has stressed the need for sustained investment in chip manufacturing. While Sony is considering building out its own capacity, it is also open to partnerships or a fab-light strategy. The company is currently working with Taiwan Semiconductor Manufacturing Co. (TSMC) on a chip plant in Japan.
“Outsourcing some production to TSMC would be the most natural choice to bring down the cost burden and improve efficiency,” said David Dai, an analyst at Bernstein.
Although Sony forecasts flat operating profit this year, it continues to invest heavily—allocating 1.7 trillion yen for capital spending and 1.8 trillion yen for strategic initiatives through fiscal 2026.
With its financial spin-off on the horizon and ambitions in content, semiconductors, and IP-driven growth, Sony appears firmly committed to reshaping itself for the next decade.
