The future of “Gang of Dragon,” the highly anticipated debut title from Nagoshi Studio, is now in serious doubt after publisher NetEase announced it will cease funding the project. The move, reported Friday, marks the latest setback for the studio founded by Yakuza series creator Toshihiro Nagoshi and signals a broader pullback from international game development by the Chinese tech giant.
NetEase informed Nagoshi Studio employees that funding will be cut in May, potentially leading to the studio’s closure, according to reports from Bloomberg. The decision comes after NetEase discovered that completing “Gang of Dragon” would require an additional ¥7 billion (approximately $44.4 million) – a significant financial hurdle the company is unwilling to clear.
A Rocky Start for Nagoshi’s New Venture
Nagoshi Studio was established in November 2021, following Nagoshi’s departure from Ryu Ga Gotoku Studio and Sega. The studio’s formation was met with considerable excitement, promising a fresh take on the action-adventure genre from a celebrated developer. “Gang of Dragon,” revealed at The Game Awards 2025, stars South Korean-American actor Ma Dong-seok, known for his roles in films like “Train to Busan” and “The Outlaws.” The game’s reveal generated buzz, but now its completion appears increasingly uncertain.
Nagoshi is reportedly seeking alternative investors to secure the necessary funding and potentially buy out the studio, but has so far been unsuccessful. Discussions are also underway with NetEase regarding the fate of the game’s assets and branding, as reported by Gematsu. NetEase has reportedly offered Nagoshi Studio the opportunity to become independent, but only if the studio can afford to acquire the existing materials and intellectual property.
NetEase Scales Back Global Gaming Investments
This funding cut is part of a larger trend of NetEase scaling back its international game development operations. The company has closed several studios in recent years, including Ouka Studio, the developer behind Square Enix’s “Visions of Mana,” and has also severed ties with Vancouver-based Worlds Untold and Seattle-based Jar of Sparks. Bloomberg’s reporting highlights a strategic shift within NetEase, prioritizing cost-cutting measures over expansive international growth.
The situation at Nagoshi Studio mirrors challenges faced by other NetEase-backed studios, including T-Minus, FPC, and Bad Brain Game Studios, all of which have been shuttered. This wave of closures and restructuring reflects a broader recalibration of NetEase’s global gaming strategy, impacting numerous developers and projects.
What’s Next for ‘Gang of Dragon’ and Nagoshi Studio?
The immediate future of “Gang of Dragon” remains unclear. While Nagoshi is actively pursuing new funding options, the substantial $44.4 million shortfall presents a significant obstacle. The possibility of the game being canceled altogether looms large, disappointing fans who were eagerly anticipating Nagoshi’s next creation. The studio’s fate is also uncertain, with its potential closure hinging on Nagoshi’s ability to secure a financial lifeline or reach a favorable agreement with NetEase.
The coming months will be critical for Nagoshi Studio as it navigates this challenging period. The outcome will not only determine the fate of “Gang of Dragon” but also the future of a studio founded on the promise of innovative and engaging action games.
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