The Chinese conglomerate has made heavy cuts across its game division as founder/CEO William Ding becomes more involved in its operations.
Marvel Rivals developer NetEase Games has reportedly laid off hundreds of developers and canceled dozens of projects as of late, according to Bloomberg.
The outlet's report alleged founder and CEO William Ding has spent the last year focusing on a "smaller portfolio" of titles in the apparent aim of outperforming fellow Chinese conglomerate Tencent. As a result, NetEase's game division has pulled back on international investments, which has already affected the various subsidiaries it's started up or acquired in recent years.
Bloomberg further revealed Ding is looking for mass-market games that encourage player spending, similar to the mobile game Eggy Party. Previously, he took a hands-off approach with NetEase Games, but sources told the outlet his direct involvement over the past year has been "dramatic."
Current staff expressed concern about Ding's focus on moneymakers and disinterest in any project that wouldn't generate "hundreds of millions of dollars per year." Some alleged he changes his mind frequently, and has previously called on staff to work late. He's also reportedly hired several recent finance graduates to directly report to him and lead or supervise units within the game division.
According to Bloomberg, internal conversations were held prior to Marvel Rivals' release about canceling the game. Ding reportedly wanted to avoid paying licensing fees to Disney so it could use popular characters like Spider-Man and Wolverine, and allegedly told NetEase artists to use their own hero designs instead of Marvel-made ones. The attempted cancelation, which NetEase later denied to Bloomberg, was said to have cost "millions of dollars."
Earlier this week, a United States support team for Rivals was laid off. NetEase later reported $11.2 billion in revenue for the 2024-2025 fiscal year, and said these reductions would "optimize development efficiency."
The report also detailed Ding's step back from games without that aforementioned moneymaking potential. Several China-based NetEase teams had their projects canceled or support support services nixed, potentially leading to a year with no major Chinese releases.
Outside of China, several western developers have been impacted: Jar of Sparks and Worlds Untold both paused operations after their funding was pulled, and NetEase laid off staff at Ouka Studios before Visions of Mana's release in 2024. 60 developers were reportedly affected by the layoffs at Jar of Sparks and Worlds Untold.
NetEase argued to Bloomberg that its various adjustments did not constitute a "wide scale layoff." Japan-based studios, like the one headed up by Like a Dragon creator Toshihiro Nagaoshi, have reportedly been granted time to "wrap up ongoing projects." However, those titles will reportedly not be given any marketing or promotional push.
Bloomberg's full report on NetEase Games can be read here.
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