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Nagoshi Studio dissolved after NetEase pulled funding, with Gang of Dragon unreleased

Yakuza creator Toshihiro Nagoshi's studio was dissolved on October 31, months after NetEase ended funding and before it shipped a game.

By Parker Patch, Industry & Business Reporter ·

Edited by Dot Matrix, Editor-in-Chief

An empty Tokyo studio office at dusk with a taped, boxed-up monitor on a cleared desk and a neon-lit window.
A dissolved studio's emptied desk. Illustration generated by AI. Illustration generated by AI.

Nagoshi Studio, the Tokyo studio founded by Yakuza series creator Toshihiro Nagoshi, was officially dissolved by a shareholders’ resolution on October 31. The closure notice appeared in Japan’s government gazette, Kanpo, in its latest list of company dissolutions.12

Its first title, Gang of Dragon, was announced in December 2025 at The Game Awards, with South Korean-American actor Ma Dong-seok in the lead. It was described then as deep in development. The game is a Kabukicho-set action adventure.13

The closure follows a funding decision made earlier this year. According to Bloomberg, staff were told on March 6 that NetEase Games would stop funding the studio in May. A NetEase spokesperson confirmed the plan as part of the company’s effort to shrink its game development activity. The spokesperson did not share exit terms.45

The reported reason was cost. Bloomberg’s sources said NetEase found that at least ¥7 billion, about $44.4 million, more would be needed to finish Gang of Dragon.4

After the cut, the studio reportedly looked for new sponsors without success. NetEase reportedly told it that it could continue independently, but could only keep the game’s assets and brand if it paid its way out.24 Nothing in the sources shows that happened.

Nagoshi joined Sega in 1989 and worked in its AM2 arcade division. He later became chief creative officer at Sega and left the board in 2021. He was also general director of Ryu Ga Gotoku Studio, the Like a Dragon developer, before founding his own studio under NetEase in late 2021.24 The studio’s staff page at the time listed other former Ryu Ga Gotoku members, including Yakuza director and producer Daisuke Sato.5

In a 2023 interview with VGC, Nagoshi said he would not let down fans of his earlier games and would make sure they were happy with the new studio’s debut.1

Nagoshi Studio is one of several casualties of NetEase’s pullback from international development. T-Minus, FPC and Bad Brain were closed, and NetEase split from Worlds Untold and Jar of Sparks. Ouka Studio, the Tokyo developer behind Visions of Mana, closed in 2024.1 Not every partner ended the same way. Grasshopper Manufacture left NetEase in September and became independent, with CEO Goichi Suda saying the move followed discussions with NetEase and its cooperation.2

What we know: the studio is dissolved, NetEase’s funding stopped, and the game was unfinished. What we do not know: the exit terms, and what becomes of Gang of Dragon’s assets and brand.

Our read: A reported ¥7 billion shortfall, no new sponsor, and unreported exit terms leave open what becomes of the game. For now the studio’s only output is a trailer.

Footnotes

  1. VGC, “Nagoshi Studio officially closes after NetEase cuts funding”. Retrieved November 2, 2026. ↩ ↩2 ↩3 ↩4

  2. GamesIndustry.biz, “Gang of Dragon developer Nagoshi Studio shutters months after NetEase cut funding”. Retrieved November 2, 2026. ↩ ↩2 ↩3 ↩4

  3. Gematsu, “Nagoshi Studio shuts down”. Retrieved November 2, 2026. ↩

  4. Gematsu, “NetEase Games to stop funding Nagoshi Studio in May”. Retrieved November 2, 2026. ↩ ↩2 ↩3 ↩4

  5. Eurogamer, “NetEase pulls funding of Yakuza creator’s Nagoshi Studio, putting development of Gang of Dragon at risk”. Retrieved November 2, 2026. ↩ ↩2

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