Perfect World, the Chinese gaming giant behind popular titles like Persona 5: The Phantom X and One Punch Man: World, is undergoing a significant leadership change. Following substantial layoffs affecting over a thousand employees and underwhelming financial results, CEO Xiao Hong and co-CEO Lu Xiaoyin have resigned, according to a Game Gyroscope report on WeChat. 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 potential strategic shift for the company as it seeks to recover from recent challenges. The new CEO's plans will be closely watched by the industry.
Perfect World's Recent Struggles
The company's recent performance has been marked by significant setbacks. Large-scale layoffs represent a considerable blow, coupled with declining revenue from existing games. Even One Punch Man: World, initially anticipated as a major success, underperformed in international beta testing and has remained stagnant since April, with no updates on major app stores.
Perfect World anticipates substantial financial losses in the first half of 2024, projecting a net loss of 160-200 million yuan, a stark contrast to the 379 million yuan profit reported last year. The gaming division is expected to bear the brunt of these losses, with a projected net loss of 140-180 million yuan.
Further compounding the difficulties, the middle office team has been drastically reduced, shrinking from 150 employees to a mere dozen. Despite these challenges, 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, has experienced its own financial volatility, but Version 4.2, launching August 6th, 2024, is anticipated to revitalize interest and potentially improve financial performance.
Perfect World's newly announced game, Neverness to Everness, has generated considerable pre-registration interest. While revenue generation is still some time away (a 2025 launch is the earliest expectation), the nearly three million pre-registrations achieved within a week demonstrate significant 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 strategic initiatives, streamline operations, and work towards financial recovery.
For more gaming news, see our coverage of Wang Yue, the open-world ARPG nearing its testing phase.
