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Due to the earthquake of April 14, 2016 and subsequent earthquakes in the Kumamoto region, operations at Sony Semiconductor Manufacturing Corporation's Kumamoto Technology Center (located in Kikuchi Gun, Kumamoto Prefecture), which is the primary manufacturing site of image sensors for digital cameras and security cameras as well as micro-display devices, were halted and currently remain suspended. With aftershocks continuing and employee safety the foremost priority, inspections of the facility and the development of a recovery plan remain ongoing. The current status of operations for the Kumamoto Technology Center is as follows:
The impact of the earthquakes on Sony Corporation's ("Sony") consolidated results continues to be evaluated. In the Devices segment, there is expected to be direct physical damage to Kumamoto Technology Center. Sony expects to incur expenses primarily for recovery and reinforcement work in response to the physical damage to the relevant portion of the Kumamoto Technology Center. Sony may also incur large opportunity losses, mainly in the Devices and Imaging Products & Solutions segments due to suspension of production for a certain period of time.
In addition, due to the suspension of manufacturing operations at Kumamoto Technology Center and potential disruption to the supply of components to Sony from certain third-party suppliers that also have manufacturing facilities in the Kumamoto region, it is possible that business operations within the Mobile Communications, Game & Network Services and Home Entertainment & Sound segments also may be affected. This potential impact is currently being evaluated.