NetEase’s decision to end financial support for Nagoshi Studio has raised serious questions about the future of Gang of Dragon, the studio’s first announced game. The change is expected to take effect in May 2026, only a few months after the title was introduced to the public during The Game Awards 2025.

Nagoshi Studio carries significant industry attention because it was founded by Toshihiro Nagoshi, the veteran creator best known for building the Yakuza franchise. After leaving Sega in 2021, he launched the new studio under NetEase, making Gang of Dragon an important first test of that partnership. Its reveal immediately drew interest from players who associate Nagoshi with cinematic crime dramas and character-driven action games.

According to the report cited in the article, NetEase reconsidered its support after learning that the project would require at least another ¥7 billion, or about $44.4 million, to reach the finish line. That additional cost appears to have changed the publisher’s willingness to continue investing in the game at its current scale.

The project is not necessarily dead, but its path forward looks difficult. Sources referenced in the report say Nagoshi Studio is now trying to secure funding from elsewhere. NetEase has reportedly allowed development to continue only if outside financing can be found, and any attempt by the studio to move ahead independently may also require negotiating control of the project’s rights.

This situation also fits into a wider pattern surrounding NetEase’s international business strategy. Over the past year, the company has reportedly reduced its overseas investment efforts and shifted more attention toward development inside China. Earlier reports mentioned plans to pull back from multiple international teams, suggesting Nagoshi Studio may be part of a broader restructuring rather than an isolated case.

Several studios have already been linked to that wider retreat. The article points to reports involving Ouka Studios, Worlds Untold, Jar of Sparks, Liquid Swords, Fantastic Pixel Castle, Bad Brain Game Studios, and T-Minus Zero as examples of teams affected by freezes, layoffs, closures, or funding pressure tied to NetEase’s evolving priorities.

For Nagoshi Studio, the stakes are especially high. Gang of Dragon was meant to introduce the team’s identity in the post-Sega era and establish what Toshihiro Nagoshi could create under a new banner. Now, instead of building momentum after its reveal, the studio faces a race to secure new investment before its debut project loses traction entirely.

Whether the game survives may depend on how quickly fresh backing can be found and whether the studio can regain enough control to keep development moving. For now, one of the most closely watched new projects from a legendary Japanese creator has entered an uncertain phase at a very early stage.