No matter how you spin it, a studio shutdown is the worst thing to happen in gaming, as not only do a bunch of developers lose their jobs, but the studio’s games also don’t see the light of day. And studio shutdowns are becoming much more common given the current state of the gaming industry. And unfortunately, another studio is officially shutting its doors before releasing its first title. Nagoshi Studios was officially closed by a shareholder resolution on October 31st, ultimately ending development of Gang of Dragon, a spiritual successor to Yakuza by its creator, Nagoshi.
Nagoshi Studios was founded in early 2022 after Toshihiro Nagoshi left Sega and joined NetEase. Daisuke Satō was the director of the Yakuza series with Nagoshi and left with him to co-found the studio. They went on to develop a game, Gang of Dragon, which was revealed at The Game Awards 2025, and it appears to be a spiritual successor to the Like a Dragon/Yakuza series, exciting many. But then, in March 2026, it was reported that NetEase had decided to cut funding to the studio, as the studio would still need $44 million to complete the game. And after that, it had been up in the air whether the game would be canceled. Then, in June, Gang of Dragon lost its director and several other employees, effectively laying the game and studio to rest. And now, on October 31st, it’s reported that the studio has been shut down, according to notice published in the Japanese government gazette, Kanpo.
The closure of Nagoshi Studio is a prime example of the current state of the industry, and it’s sad to see a game that held so much promise never see the light of day, but if nothing changes, this will continue to happen. Either way, this announcement lays the rest of the story of Nagoshi Studio and the development of its first title, Gang of Dragon. Nagoshi Studio has officially shut down after a shareholder resolution on October 31st.