The most revealing feature of Hiroki Totoki’s Sony is not what the company is adding. It is what the company has become prepared to stop.
During Totoki’s first full year as chief executive, Sony completed the partial separation of its financial-services arm, accepted deep impairments at Bungie, moved to wind down the Pixomondo visual-effects operation, abandoned plans to launch electric vehicles through Sony Honda Mobility and agreed to place its television and home-audio business into a strategic partnership with TCL. None of those decisions fits the old image of Sony as a corporation determined to preserve every activity carrying its name. Together, they describe a management culture becoming more selective about where the brand, the balance sheet and the attention of the chief executive should be deployed.
That selectivity matters because Sony no longer suffers from a shortage of attractive assets. It owns one of the world’s most consequential gaming platforms, a formidable recorded-music and publishing operation, a Hollywood studio, a global anime distributor, Japanese production houses, valuable character and catalogue rights, premium cameras and a leading image-sensor franchise. Its problem is more demanding: how to make those businesses reinforce one another without turning creative collaboration into corporate choreography.
Totoki, who became president and chief executive in April 2025, is the executive now responsible for solving that problem. He inherited a Sony rescued from its most dangerous years and repositioned around entertainment, intellectual property and technology. His predecessors did the heavy work of stabilisation and strategic redirection. His mandate is to turn the resulting collection into a system.
The CEO after the turnaround
There is a useful distinction between leading a recovery and leading after one. A recovery creates an obvious hierarchy of decisions: cut losses, repair cash flow, restore credibility, concentrate on businesses with defensible economics. The period after a recovery is less forgiving. Management must decide how much of the new confidence is structural, how much is cyclical and where success has begun to conceal complacency.
Sony entered Totoki’s tenure from a position of unusual strength. In the year ended March 2026, continuing operations generated sales of ¥12.48 trillion and operating income of ¥1.45 trillion, both supported by powerful contributions from games, music and image sensors. Entertainment activities represented roughly two-thirds of group sales, compared with about 30 per cent in fiscal 2012. Sony had ceased to be principally understood as a consumer-electronics manufacturer with entertainment interests. It had become a global entertainment owner with a technological spine.
That achievement is also the source of Totoki’s difficulty. The better Sony performs, the easier it becomes to confuse ownership with integration. A company can possess game studios, film producers, music catalogues, anime franchises, cameras, sensors and fan platforms without those assets generating meaningfully more value together than they would under separate roofs. The corporate centre can encourage cooperation; it cannot manufacture cultural relevance by committee.
Totoki’s answer has been to sharpen both accountability and coordination. Sony’s major businesses operate under designated chief executives, while group functions are divided among senior officers responsible for strategy, digital operations, people and finance. The architecture gives operating leaders room to run their businesses while reserving for the group chief executive the questions that cross divisional borders: capital allocation, technology, intellectual property, talent, distribution and risk.
It is a model designed for a corporation whose advantage lies in variety. It will work only if Totoki can make the centre influential without making it intrusive.
An operator formed at Sony’s edges
Totoki is sometimes described principally through his years as chief financial officer, a role he held from 2018 before adding the presidency and chief operating office in 2023. The description is accurate but incomplete. His career has placed him repeatedly at the intersection of finance, networks and businesses under pressure.
He joined Sony in 1987 and later served as a representative director of Sony Bank. He went on to senior roles at the group’s network-services operations, including the business known as So-net, before taking command of Sony’s mobile-phone unit in 2014. He subsequently became chief strategy officer, then chief financial officer, and briefly assumed direct responsibility for PlayStation’s leadership transition as interim chief executive of Sony Interactive Entertainment.
Those assignments are more revealing than a conventional rise through a single flagship division. Banking taught the economics of trust and regulation. Network services exposed the value of recurring relationships rather than one-off hardware sales. Mobile provided an education in what happens when a celebrated brand confronts stronger ecosystems and compressed differentiation. Finance demanded choices across a portfolio whose businesses carry radically different investment cycles. PlayStation placed him inside Sony’s largest entertainment engine at a moment when the industry was grappling with escalating development costs and uncertain bets on live-service games.
The result is a chief executive who is less romantic about corporate inheritance than Sony’s cultural stature might suggest. Totoki’s public language is measured, but his record points to a willingness to acknowledge sunk costs. That trait is becoming central to his leadership. Sony’s next phase will require investment, yet it will require an equally developed capacity to withdraw when strategy no longer matches reality.
PlayStation is the economic spine—and the warning
No part of Sony better captures the promise and danger of Totoki’s strategy than PlayStation. Game & Network Services produced ¥4.69 trillion in annual sales and ¥463.3 billion in operating income in fiscal 2025. The PlayStation platform counted 125 million monthly active users in March 2026. Network services, digital distribution and a vast installed base have turned the business into an economic infrastructure, not merely a console franchise.
That infrastructure gives Sony something every entertainment company wants: a direct, authenticated relationship with a global audience that returns frequently, spends digitally and can be introduced to new experiences at low marginal distribution cost. It is easy to imagine PlayStation helping Sony acquire anime subscribers, extend game properties into film and television, sell music-led experiences or provide a launchpad for new intellectual property.
It is harder to execute those ambitions without weakening the platform’s core proposition. Players do not arrive to participate in a conglomerate’s synergy plan. They arrive for games, communities and experiences they consider worth their time. Every cross-group initiative must therefore earn its place inside the PlayStation environment rather than treat the audience as inventory.
The Bungie experience has made that discipline unavoidable. Sony recorded ¥120.1 billion of impairment losses against Bungie’s intangible and other assets during fiscal 2025. The charge did not erase the strategic logic of acquiring creative capability or expanding beyond traditional single-player titles. It did expose the danger of assuming that the economics of persistent online games can be purchased on schedule. Creative talent, production systems, audience habits and live operations do not become predictable merely because a transaction model says they should.
For Totoki, the lesson extends beyond one studio. Sony needs ambitious game investment because development cycles are long and audiences are concentrating around fewer, larger properties. It also needs gates strong enough to stop enthusiasm from becoming an entitlement to capital. The group’s forecast for fiscal 2026 anticipates lower gaming sales but a significant rise in operating profit, an expectation that places execution, engagement and cost control above sheer volume.
PlayStation’s scale will tempt Sony to use it as the answer to every distribution question. Totoki’s more intelligent course is to treat it as a privileged route to audiences, not a compulsory destination for every Sony asset.
Anime is becoming a global operating model
If PlayStation is Sony’s largest platform, anime may be its clearest demonstration of what cross-business ownership can accomplish. The group now spans production, music, theatrical distribution, streaming, games, merchandise and fan engagement. Aniplex and its studios can help create and cultivate properties; Crunchyroll can distribute them around the world; Sony Pictures can support global theatrical reach; music and gaming operations can deepen the relationship; technology can improve production and localisation.
Crunchyroll passed 21 million paid subscribers by the end of March 2026 and carries more than 50,000 episodes, subtitled and dubbed across 13 languages. Those figures are commercially important, but the more consequential asset is the network around them: creators in Japan, fans across continents, data on audience behaviour, convention presence, awards, commerce and the ability to build anticipation across release windows.
Sony’s treatment of Solo Leveling illustrates the model. A story originating as a South Korean novel and webtoon was developed into Japanese animation, prepared in distinct localised versions and distributed globally. Production involved Sony-affiliated companies on both the creation and distribution sides, while technology helped reduce the time and cost of complex animation work. The result was not simply a programme delivered to subscribers. It became a community event capable of feeding theatrical releases, awards participation and a broader franchise.
The success of Demon Slayer: Kimetsu no Yaiba Infinity Castle reinforced the opportunity. So have Sony’s alliances with KADOKAWA and Bandai Namco, both of which extend its reach into the ecosystems where Japanese stories, games and characters are created. The strategic appeal is clear: anime travels unusually well, rewards deep fandom and supports multiple forms of monetisation over long periods.
Yet anime also reveals the risk of Sony’s scale. The industry’s creative supply chain remains labour-intensive and frequently strained. Global demand can encourage owners to increase output faster than studios can sustain quality. A corporation that speaks of maximising intellectual-property value must ensure that the creators responsible for that value are not treated as a production constraint to be optimised away.
Totoki’s strongest formulation is therefore not that Sony owns an anime pipeline. It is that Sony can build an engagement platform linking creators and fans. The difference is material. A pipeline extracts throughput. A platform becomes more valuable when participants choose to remain.
Music, pictures and the difficult economics of ownership
Sony’s music business offers the portfolio’s most dependable evidence that intellectual property can compound. Fiscal 2025 sales rose to ¥2.12 trillion and operating income reached ¥447 billion. Streaming continues to expand the value of recorded music and publishing catalogues, while Sony’s relationships with artists, songwriters and digital services create both current income and long-duration optionality.
The group has continued to put capital behind that thesis. Investments connected to the Queen and Pink Floyd catalogues expanded its exposure to enduring music rights. A partnership with Singapore’s GIC created additional capacity for music-IP investment. Sony also raised its ownership of Peanuts Holdings to 80 per cent, adding a globally recognised character franchise whose value can extend across screen, music, consumer products and experiences.
These assets fit Totoki’s Sony because they are capable of moving between formats without losing their identity. A song can return through streaming, film, games, advertising or a biographical production. A character can live in animation, merchandise and location-based entertainment. A game can become a television series and send audiences back toward the original title. The commercial logic is not to force every property into every channel; it is to possess enough capabilities that the right property can travel when the audience invites it to.
Sony Pictures remains the more uneven part of that equation. The segment produced ¥1.50 trillion of sales in fiscal 2025 but only ¥104.9 billion in operating income, after charges related to the closure of Pixomondo. The studio has valuable franchises and a productive television operation, while Crunchyroll has become an increasingly important contributor. But film economics remain volatile, theatrical slates are hit-driven and technology investments can deteriorate quickly when their commercial use is not sufficiently clear.
Totoki must resist two symmetrical errors. One would be to judge creative businesses by the smoothness expected of subscription software. The other would be to use the unpredictability of creativity as an excuse for undisciplined spending. Great entertainment requires tolerance for failure; durable entertainment companies require a method for ensuring that failure remains survivable.
The technology foundation cannot become a footnote
Sony’s reinvention as an entertainment company has not made technology less important. It has changed technology’s role. Cameras, production tools, spatial systems and image sensors increasingly serve the creation and delivery of experiences rather than the old ambition to place a Sony-branded appliance in every category.
The Imaging & Sensing Solutions business is central to that foundation. Its fiscal 2025 sales climbed to ¥2.15 trillion and operating income to ¥357.3 billion, driven by demand for advanced image sensors. Sony’s advantage rests on difficult analogue capabilities spanning design, process technology, stacking and manufacturing. These are not fashionable assets, but they are strategically valuable precisely because they cannot be reproduced through software alone.
Totoki’s preliminary agreement with TSMC over next-generation image sensors reflects both ambition and realism. Sony intends to protect the system knowledge that differentiates its sensors while examining a partnership that could improve manufacturing economics and adaptability. The proposed structure, still under study, would place Sony in control of a joint venture using a new facility in Kumamoto. It is an attempt to share industrial burden without surrendering the technological core.
The broader electronics portfolio is receiving the same scrutiny. Entertainment, Technology & Services reported lower annual sales and profit as the display market weakened. The planned partnership with TCL for televisions, business displays, home theatre and home audio signals that brand heritage alone will not justify a fully owned industrial model. Sony wants the creative tools, premium customer relationships and technologies that strengthen the group. It is less attached to manufacturing structures that consume capital without reinforcing that advantage.
This is where Totoki’s financial background becomes strategically useful. The question is not whether hardware belongs in an entertainment company. The question is which hardware capabilities increase Sony’s power with creators, platforms and audiences—and which merely preserve a memory of what Sony used to be.
AI requires a compact with creators
No issue will test Sony’s claim to unite creativity and technology more severely than artificial intelligence. The opportunity is extensive. AI can lower production costs, accelerate repetitive work, improve localisation, personalise discovery and make complex game or film projects easier to build. Sony has already invested more than $50 million in applying AI across production and other workflows in its pictures business, while PlayStation is exploring uses in development, quality, personalisation and recommendation.
But Sony does not approach AI as a neutral software buyer. It is an employer and partner of artists, a custodian of music and film rights, an owner of characters and stories, a distributor facing synthetic competition and a technology group capable of building its own tools. Any gain in efficiency that weakens trust with creators could destroy value elsewhere in the portfolio.
Totoki has therefore placed a boundary around the strategy: human creativity must remain at the centre. Sony’s music business is pursuing standards for labelling AI-generated content, while group initiatives are intended to respect intellectual-property rights and make production environments safer and more transparent. The language is prudent. The real test will be commercial.
Creators will judge Sony by contracts, consent, compensation and control, not by principles presented on a strategy slide. Audiences will judge whether AI expands the range of human expression or produces cheaper imitations of it. Investors will judge whether spending creates proprietary advantage or merely follows an industry fashion. Totoki has to satisfy all three constituencies at once.
Sony is better positioned than many peers to establish that compact because it understands both sides of the conflict. It owns technology and content; it sells tools to creators and profits from their work. That dual identity can become a source of judgment. It can also become a conflict of interest if efficiency is allowed to outrun legitimacy.
Asia is not a region in this strategy; it is the operating centre
The geography of Totoki’s Sony is often obscured by the familiarity of its global brands. PlayStation is international, Sony Music is deeply embedded in Western markets and Sony Pictures operates from Hollywood. Yet the group’s most distinctive growth system is anchored in Asia.
Japan remains the source of critical technology, production expertise, game development and intellectual property. Anime connects Japanese creators to audiences across Southeast Asia, India, Europe and the Americas. Solo Leveling demonstrates how Korean narrative material can be developed through Japanese production capabilities and distributed through a global platform. The image-sensor strategy links Japanese manufacturing depth with Taiwan’s semiconductor ecosystem. GIC’s role in music investment brings Singaporean capital into a global rights market. Sony Pictures Networks India and SonyLIV keep the group exposed to one of the world’s largest and most contested media markets.
For FigureAsia, this makes Totoki one of the region’s most consequential corporate leaders not because Sony is a famous Japanese company, but because he is assembling a model for how Asian intellectual property, industrial technology and capital can travel globally without being stripped of their origins.
The old route to global scale often required Asian companies to become more Western in organisation, branding and distribution. Sony’s current opportunity is different. It can make Japanese and wider Asian creative ecosystems legible to global audiences while retaining the specificity that makes their work desirable. That requires localisation without dilution, investment without domination and distribution without converting every culture into the same product template.
Making one company without imposing one culture
Totoki’s central challenge can be stated simply: Sony must behave more like one company while avoiding the creative sterility that often follows when a conglomerate tries too hard to act as one.
The financial case for coordination is persuasive. PlayStation can lower customer-acquisition friction for Crunchyroll. Film and television can extend game properties. Music rights can gain new life through visual storytelling. Sensors, cameras and production systems can improve how content is made. Fan data can reveal where a property has permission to expand. Capital can be directed toward rights and technologies with uses across more than one business.
The organisational case is harder. Music labels, game studios, film producers, semiconductor engineers and consumer-electronics teams do not share the same rhythms, incentives or definitions of success. The more aggressively headquarters demands visible synergy, the more likely managers are to produce collaborations that satisfy internal targets but leave audiences indifferent.
Totoki’s task is to create conditions for exchange rather than prescribe the outcome. The centre should make introductions, supply capital, set standards, protect rights, build common technology and remove barriers. It should also know when to step away. The best evidence of integration will not be the number of projects carrying multiple Sony logos. It will be whether creators gain capabilities they could not access alone and whether audiences receive experiences that feel richer rather than more corporate.
His first year suggests a leader willing to prune the portfolio while investing behind conviction. Sony’s results give him room to act: fiscal 2026 guidance calls for operating income of ¥1.6 trillion even as sales are expected to edge lower. But strong numbers will not settle the strategic question. They buy time for Totoki to prove that entertainment, intellectual property and creation technology form a coherent advantage rather than an elegant description of diverse earnings streams.
Sony has spent more than a decade becoming a company that no longer needs to be saved. Under Hiroki Totoki, it now has to become a company whose parts make one another more valuable. If he succeeds, Sony will not return to the old ideal of a single corporation controlling the living room. It will occupy something more consequential: the network connecting creators, technology, stories and audiences across borders.
That is a less visible ambition than a new device and a more difficult one to copy. It is also the standard by which Totoki’s tenure should be judged.
