Nagoshi Studio officially closes after NetEase cuts funding

Nagoshi Studio, the new NetEase-backed studio founded by Yakuza series creator Toshihiro Nagoshi, has officially closed after months of speculation.

Japan’s Official Gazette Kanpo confirmed the news on Monday via its latest listing of company dissolutions, which includes Nagoshi Studio.

Nagoshi Studio was formed in 2021 and its debut title, Gang of Dragon, was announced in Decemberand said to be “deep into development”. The action game stared prolific South Korean-American actor Ma Dong-seok, best known for his performances in Train to Busan, The Outlaws, and Marvel’s Eternals.

According to an earlier Bloomberg report, employees of Nagoshi Studio were told in March that publisher NetEase intended to cut off funding for the project.

NetEase allegedly made the decision after discovering that the project needed an additional ¥7 billion ($44.4 million) in funding to reach completion.

In Nagoshi Studio’s first Western interview in 2023, Nagoshi told VGC that he would not let down fans of his previous games and would ensure they would be happy with his new studio’s debut game.

Nagoshi Studio is the latest casualty of NetEase’s decision to significantly scale back its international game development operations, following years of investment in new studios around the world.

The move has caused chaos across its international operations, with several studios being forced to close, and others seeking new funding.

In addition to the initial closure of T-Minus, FPC, and Bad Brain, NetEase split from Vancouver-based Worlds Untold, the studio it founded with Mass Effect writer Mac Walters in 2023, as well as Seattle-based Jar of Sparks, the studio founded in 2022 by Xbox veteran Jerry Hook.

Ouka Studio, the Tokyo-based developer behind Square Enix’s Visions of Mana, was also closed in 2024. Other Japanese studios, like Goichi Suda’s Grasshopper Manufacture and Resident Evil producer Hiroyuki Kobayashi’s GPTRACK50, have pushed ahead with new games without NetEase funding.

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