NetEase has announced that it will cease funding Nagoshi Studio, the development house founded by Toshihiro Nagoshi, creator of the renowned Yakuza and Super Monkey Ball series. This decision casts a significant shadow over the future of the studio’s ambitious new game, ‘Gang of Dragon,’ which is envisioned as a major title in the vein of the ‘Like a Dragon’ series. The cessation of funds is set to begin in May of this year, a critical decision reportedly communicated to NetEase on March 6, according to a Bloomberg report.
The Reasons Behind NetEase’s Funding Cut
An anonymous source, speaking to Bloomberg, indicated that NetEase’s decision was prompted by the substantial estimated investment required to bring ‘Gang of Dragon’ to completion, a figure that reportedly reached approximately $45 million. The game, which commenced development in 2021, made its public debut with a trailer at The Game Awards in 2025. Featuring the famous Korean actor Ma Dong-seok in a prominent role, ‘Gang of Dragon’ is poised to offer a modern and more gritty interpretation of the Yakuza style, a genre that has garnered millions of fans globally.
The situation with Nagoshi Studio is not an isolated incident; it forms part of a broader trend of divestments by NetEase. Following the pandemic, NetEase embarked on numerous ventures, injecting significant capital into various emerging projects. However, as many of these projects have failed to meet performance expectations years after their initial investment, NetEase is now strategically cutting its losses to prevent major financial imbalances.
This strategy has already led to the closure of several studios, including Ouka shortly after the release of ‘Visions of Mana,’ along with Worlds Untold, Jar of Sparks, Humanoid Origin, Fantastic Pixel Castle, and Bad Brain Game Studios. While T-Minus Zero Entertainment and Anchor Point, both recipients of considerable NetEase investment, have successfully transitioned to independence, NetEase continues to hold shareholder stakes in other notable studios such as Quantic Dream, Grasshopper Manufacture, and Rebel Wolves.
This strategic pivot is fully consistent with the previously stated vision of NetEase CEO and founder William Ding, who aims for “a leaner company focused on mass-market games.” This represents a significant shift from NetEase’s earlier objective of “generating 50% of its profits outside of China,” a goal that drove the company to fund numerous new and existing studios that are now either being closed or abandoned.
As a result, Nagoshi Studio is now actively seeking new financial partners. NetEase has expressed its willingness to negotiate the transfer of intellectual property and assets developed to date, provided that any prospective new company or investor can demonstrate the financial capacity to cover the associated costs.
