NetEase Games will cease funding to Toshihiro Nagoshi’s Nagoshi Studio in May as the company shrinks its game development activities, a NetEase Games company spokesperson told Bloomberg. Nagoshi Studio employees were reportedly told of the decision to cut funding on March 6.
This is the latest in a string of reductions, including layoffs and studio closures, by NetEase Games as they cut back on investments in the gaming industry. The decision to cease funding came after NetEase Games discovered that Nagoshi Studio needed at least seven billion yen, or roughly $44.4 million, to finish the studio’s latest project, Japanese action game Gang of Dragon.
Nagoshi is currently looking for new sponsors in order to fund and complete development of Gang of Dragon, but he’s found no success at the time of this writing. Nagoshi Studio is currently discussing with NetEase Games about how to handle game materials that were already developed. NetEase Games has reportedly told Nagoshi Studio that they’re free to go independent, and the assets and brand may be kept if it’s able to pay its way out.
Nagoshi Studio was founded in November 2021 as a subsidiary to NetEase Games, led by former SEGA COO and Yakuza series director Toshihiro Nagoshi. Former SEGA and Yakuza staff also joined the studio, such as producers Daisuke Sato and Kazuki Hosokawa. The studio aims to deliver high-end games with worldwide releases as their primary focus. Gang of Dragon was announced at The Game Awards 2025, where it was revealed that the game’s protagonists is portrayed by South Korean and American actor Ma Dong-seok.
