Layoffs and Resignations Prompt Perfect World to Appoint New CEO

Perfect World, the Chinese gaming giant behind titles like Persona 5: The Phantom X and One Punch Man: World, is experiencing 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 CEO role. This transition signals a strategic shift for the company, aiming for a fresh start and a renewed direction. The new leadership's approach will be closely watched.

Perfect World's Recent Challenges

The company's recent struggles include extensive job cuts, a significant blow to its operations. Revenue from existing games has also declined. Even One Punch Man: World, initially projected as a major success, underperformed in international beta testing and has seen no updates on app stores since April.

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 difficulties, the middle office team has been drastically reduced.

Despite the challenges, there's a glimmer 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's August 6th, 2024 release is anticipated to generate excitement and potentially improve financial performance.

Furthermore, the newly announced game, Neverness to Everness, has generated considerable pre-registration numbers – nearly three million worldwide within a week. While revenue generation won't begin until its anticipated 2025 launch, this early interest is encouraging.

The success of Perfect World's turnaround hinges on the new management team's ability to navigate these challenges. The coming months will be crucial as they implement strategic initiatives, streamline operations, and strive to restore financial stability. For more gaming news, see our coverage of Wang Yue, an open-world ARPG nearing its testing phase.