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Unfortunately yes, it will remove any data from the phones memory, however it will not touch an SD card or SIM card.
Hi MusicalPanda47,
Welcome to the community,
If the instructions above do not help, then I can only advise that you perform a software repair on the device to remove the lock code.
Use the instructions below.
1. Before you start you have to download the PC Companion software from PC Companion
and install it on your PC.
2. Once installed on your PC, double-click the PC Companion icon on your desktop to start the update.
Note! For some models you will be prompted to do a backup prior to the update and then restore.
3. Install and open PC Companion then select Support Zone.
4. Phone Software Update.
5. Start.
6. Repair Phone
7. Continue
8. Accept data removal
9. Next
10. Wait for prepare
11. Select Phone
12. Follow the connection steps
Performing a Factory reset will remove all content from the device, apart from the SD card, it be like the first day you purchased the product.
After updating to new Android my Xperia E1 is even slower and some problems occured, like the screen locks and I have to hard boot my phone, I cant swipe at all on the screen.