Earlier this week, NetEase made headlines by cutting jobs at its Marvel Rivals development studio in Seattle, leaving many puzzled about the reasoning behind such a move on a seemingly thriving project. Marvel Rivals, a popular game since its launch in December, has drawn in over 40 million players, contributing to NetEase’s impressive $2.9 billion revenue in gaming and services for the quarter it was released.
In an interesting twist, there were whispers that the CEO, Ding, considered pulling the plug on Marvel Rivals even before it hit the shelves. Reportedly, he hesitated to shell out for Disney’s licensing fees for Marvel’s iconic superheroes and villains and toyed with the idea of swapping them out for original creations by NetEase’s artists—an account that NetEase has since denied, according to Bloomberg.
Over the last year, NetEase has been stepping back from various non-Chinese studios. Notable divestments include the Canadian studio Worlds Untold, helmed by former BioWare creative Mac Walters; Seattle’s Jar of Sparks, founded in 2022 by Xbox veteran Jerry Hook; and Ouka Studio in Tokyo, known for developing Visions of Mana for Square Enix. Locally, similar cutbacks have been reported, possibly leaving NetEase’s Chinese studios without any major new releases slated for 2026.
Shortly after Bloomberg’s report, Game File chimed in, stating that NetEase aims to divest from most of its overseas teams, casting a shadow over more than a dozen studios under their wing. This includes some recent establishments like T-Minus Zero Entertainment, initiated by ex-BioWare Austin VP Rich Vogel, and Fantastic Pixel Castle, which is crafting a modern fantasy MMORPG led by game design veteran Greg Street of World of Warcraft and League of Legends fame. NetEase also snapped up Grasshopper Manufacture and Quantic Dream in 2021 and 2022, respectively.
For those eagerly awaiting new projects from the former creators of Yakuza/Like A Dragon, there might be some sobering updates. It seems NetEase has decided to hit the brakes on additional funding and time for new titles from Japanese developers, with no plans for promotion. However, fans can still anticipate fresh offerings from Ryu Ga Gotoku Studio, such as a new Virtua Fighter and Project Century.
These layoffs at NetEase’s international branches are part of a broader wave of uncertainty sweeping through the gaming industry, which has seen significant downsizing in recent years.
Update: We’ve adjusted this story to incorporate Game File’s latest findings, painting a bleaker picture of NetEase’s retreat from their foreign studio investments.
