Image source | pexels
On November 2, an announcement appeared in Japan’s Official Gazette: Nagoshi Studio, founded by Yakuza series producer Toshihiro Nagoshi, was dissolved by a shareholder resolution on October 31 and has entered liquidation.
Nagoshi previously worked on titles like Yakuza and Judgment at Sega; after leaving, he formed a new team with developers who also came from Sega. On January 24, 2022, NetEase announced the establishment of Nagoshi Studio, with Nagoshi serving as representative director and CEO. Fully funded by NetEase Games, the studio focused on developing console games for the global market. The team retained operational and creative autonomy, and thereafter prepared its first title.
It was not until last December’s TGA that Nagoshi Studio revealed the action-adventure game GANG OF DRAGON, starring Don Lee as protagonist Shin Ji-seong, with Nagoshi handling the script and leading development.
Nearly four years passed from NetEase’s announcement of the studio to the reveal of its debut title; yet less than a year after the game went public, the team has been dissolved, and the debut title has still not shipped.
A quick look at the game: GANG OF DRAGON is set in Tokyo’s Shinjuku Kabukicho, where the player takes on the role of a Korean gang executive, forming ties with the people living there amid local gang conflicts.
The game uses a third-person perspective and features hand-to-hand combat, blades, firearms, and vehicle-based action. The crime themes and character stories from Nagoshi’s past work continue in this new title.
However, no release date was ever announced. In March this year, Bloomberg reported that NetEase would stop funding Nagoshi Studio; NetEase confirmed funding would end from May. According to the report, NetEase made the decision after learning the project would need at least another 7 billion yen to complete.
That 7 billion yen was the capital still needed going forward; the report did not disclose how much the project had already spent. At the time, Nagoshi was seeking new investors, and the team was discussing with NetEase how to handle the assets developed so far.
Citing people familiar with the matter, Bloomberg said the team could operate independently, but retaining the assets and brand would require paying a fee, with specific terms undisclosed. In other words, beyond ongoing R&D investment, a new investor would also have to consider the cost of taking over existing development results.
In the months that followed, the studio saw successive changes: in April, its official YouTube channel was temporarily deleted then restored; in May, the official website became inaccessible. Game Spark found in June, after checking employees’ LinkedIn profiles, that multiple members had left by the end of May.
Currently, GANG OF DRAGON’s Steam page still shows "Coming Soon," but with the studio formally dissolved, the game’s future is clouded. The team invested years yet never saw its debut title ship — a genuine pity.
Beyond the studio’s dissolution, another point worth attention is that NetEase’s investment in several overseas R&D teams has been contracting over the past two years.
At its Q1 2025 earnings call, Ding Lei said in response to related questions that closing some overseas studios was driven by considerations of product positioning and quality.
In November 2024, Worlds Untold, led by Mass Effect series writer Mac Walters, announced a pause in operations to seek new partners.
In 2025, Fantastic Pixel Castle, founded by Greg Street, lost NetEase funding and, after failing to find new investors, announced it would close on November 17 that year.
This October, Grasshopper Manufacture, led by Goichi Suda, also split from NetEase and returned to being an independent developer. Nagoshi Studio losing its funding came amid NetEase’s successive adjustments to its overseas R&D investments.
