Layoffs, Resignations Lead to New Perfect World CEO

Perfect World, the Chinese gaming giant behind popular titles like Persona 5: The Phantom X and One Punch Man: World, is undergoing a major leadership change. Following significant 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 coming months will be crucial in observing the impact of this leadership change and the new strategies implemented.

Perfect World Faces Challenges

The company's recent struggles are substantial. Widespread layoffs represent a significant blow, and revenue from existing games has declined. Even the highly anticipated One Punch Man: World underperformed in international beta testing and has remained stagnant since April, with no updates on major app stores.

Perfect World anticipates a considerable financial downturn 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 drastically reduced.

Despite these setbacks, there are glimmers of hope. The upcoming update for Tower of Fantasy, Hotta Studio's open-world gacha RPG, aims to reinvigorate player engagement and potentially boost revenue. Version 4.2 is scheduled for release on August 6, 2024.

Furthermore, the newly announced game, Neverness to Everness, has generated considerable pre-registration interest. While revenue generation is still some time away (launch is not expected before 2025), the nearly three million pre-registrations within a week indicate significant player anticipation for this urban-themed open-world RPG.

The success of Perfect World's turnaround hinges on its new leadership's ability to navigate these challenges effectively. The coming months will be critical as they implement key initiatives, streamline operations, and strive to restore financial stability. For more gaming news, be sure to check out our other article on Wang Yue's open-world ARPG, which is nearing its testing phase.