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 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 been appointed as the new CEO. This transition signals a strategic shift for the company as it aims to revitalize its operations and chart a new course. The new CEO's strategies will be closely watched.
Perfect World's Recent Challenges
The company's recent performance has been marked by significant challenges. Widespread layoffs represent a major setback, and revenue from existing games has declined. Even One Punch Man: World, initially anticipated as a major success, underperformed in international beta testing and has remained curiously inactive on the App Store and Google Play since April.
Perfect World projects substantial financial losses in the first half of 2024, forecasting a net loss of 160-200 million yuan, compared to a profit of 379 million yuan the previous 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 significantly reduced, shrinking from 150 employees to a mere dozen. Despite the current difficulties, there are glimmers of hope. The upcoming update for Tower of Fantasy, Hotta Studio's open-world gacha RPG, could provide a much-needed boost. Version 4.2, launching August 6, 2024, is anticipated to reignite player interest and potentially improve financial performance.
The newly announced game, Neverness to Everness, has already generated considerable excitement. While revenue generation is still some time away (a 2025 launch at the earliest is anticipated), the nearly three million pre-registrations achieved worldwide within a week demonstrate significant player anticipation.
The success of Perfect World's turnaround hinges on the effectiveness of its new leadership. The coming months will be crucial as the company focuses on key initiatives, streamlines operations, and works towards financial recovery.
For more gaming news, see our other article on Wang Yue, the open-world ARPG nearing its testing phase.
