Perfect World, the Chinese gaming giant behind popular titles like Persona 5: The Phantom X and One Punch Man: World, is undergoing significant leadership changes. Following substantial layoffs affecting over a thousand employees and disappointing financial results, CEO Xiao Hong and co-CEO Lu Xiaoyin have resigned, according to a Game Gyroscope report on the Chinese WeChat platform. However, reports suggest they will remain on the board as directors.
Gu Liming, a long-serving Perfect World executive and former Senior Vice President, has assumed the role of CEO. This transition signals a strategic shift for the company, aiming for a fresh start and a renewed direction. The new leadership's strategies will be closely watched.
Perfect World Faces Challenges
The company's recent layoffs represent a major setback. Revenue from existing games has declined, with even the highly anticipated One Punch Man: World underperforming in international beta testing. The game has remained surprisingly inactive, lacking updates on the App Store and Google Play since April.
Perfect World anticipates significant financial losses in the first half of 2024, projecting a net loss of 160-200 million yuan, compared to a profit of 379 million yuan in the same period last year. The gaming division is expected to bear the brunt of this loss, with a projected net loss of 140-180 million yuan.
Further compounding the situation, the company's middle office team has been drastically reduced from 150 employees to just a few dozen. Despite these difficulties, the upcoming update for Tower of Fantasy offers a glimmer of hope for a turnaround. Hotta Studio's open-world gacha RPG, Tower of Fantasy, version 4.2, launching August 6, 2024, is anticipated to reinvigorate the title and potentially improve financial performance.
Meanwhile, the newly announced game, Neverness to Everness, has generated considerable pre-registration interest. While revenue generation is not expected until its launch (no earlier than 2025), the nearly three million pre-registrations within a week worldwide indicate strong player anticipation for this urban-themed open-world RPG.
The success of Perfect World's new management team in navigating these challenges remains to be seen. The coming months will be crucial as they implement key strategies, streamline operations, and strive to regain financial stability.
For more gaming news, see our coverage of Wang Yue, the open-world ARPG nearing its testing phase.
