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 struggles include widespread layoffs, a decline in revenue from existing games, and disappointing performance of anticipated titles. One Punch Man: World, initially projected as a major success, underperformed in international beta testing and has remained stagnant since April, with no updates on major app stores.

Perfect World anticipates significant 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 these losses, with a projected net loss of 140-180 million yuan. Further compounding the situation, the middle office team has been drastically reduced in size.

Despite these setbacks, there are glimmers of hope. The upcoming update for Tower of Fantasy, Hotta Studio's open-world gacha RPG, is anticipated to boost performance. Version 4.2, launching August 6th, 2024, is expected to reignite player interest and potentially alleviate financial pressures.

The newly announced game, Neverness to Everness, has also generated considerable excitement. While not expected to launch until 2025 at the earliest, the game has already amassed nearly three million pre-registrations globally within a week, indicating strong early interest.

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 the company focuses on key initiatives, streamlines operations, and strives to recover financially.

For more gaming news, see our coverage of Wang Yue's open-world ARPG, which is nearing its testing phase.