Perfect World, the Chinese gaming giant behind 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, assumes 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's Recent Challenges
The company's recent performance has been marked by significant challenges. Extensive layoffs represent a considerable 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 stagnant since April, with no updates on the App Store or Google Play.
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 last year's 379 million yuan profit. 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 middle office team has been significantly reduced.
Despite these difficulties, there are glimmers of hope. The upcoming update for Tower of Fantasy, Hotta Studio's open-world gacha RPG, aims to revitalize the game and potentially improve its financial performance. The update, version 4.2, is scheduled for August 6, 2024.
Furthermore, Perfect World's newly announced game, Neverness to Everness, has generated considerable pre-registration numbers. While revenue generation is still some time away (a 2025 launch is the earliest expectation), the nearly three million pre-registrations within a week indicate strong early interest.
The success of Perfect World's turnaround hinges on its new management team's ability to navigate these challenges. The coming months will be crucial as the company focuses on key initiatives, streamlines operations, and aims to recover financially.
For more gaming news, see our other article on Wang Yue, the open-world ARPG nearing its testing phase.
