GungHo Online Entertainment, the developer behind hits like *Puzzle & Dragons*, *Summons Board*, *Princess Punt Sweets*, and the Japanese operator of *Ragnarok Online*, is facing a shareholder revolt. Despite maintaining profitability, the company's recent lackluster performance has drawn sharp criticism from investors.
On July 23, investment firms INTERTRUST TRUSTEES (CAYMAN) LIMITED (representing JAPAN-UP) and Strategic Capital jointly announced a request to convene an extraordinary shareholders' meeting. Their primary proposal: the removal of current President and CEO Kazuki Morishita from his position as a director, a move that has sparked significant discussion among gamers in Japan.
The two investment firms, which collectively hold approximately 8% of GungHo's shares, pointed to the company's starkly negative performance compared to its peers. They noted that while other major game companies like Capcom, Nintendo, and the Konami Group have seen their stock prices surge by 258% to 1780% over the past decade, GungHo's stock has plummeted by about 35%, with its business performance remaining stagnant.
Consequently, they argue, "As president, Mr. Morishita should be held responsible for the company's poor business operations and stock performance."
▼ Strategic Capital's public request to convene an extraordinary shareholders' meeting.
The investors also emphasized that in the 13 years since launching the massively successful Puzzle & Dragons in 2012, GungHo has failed to produce a second flagship title, branding it a "one-hit wonder." They claim that while other games were developed, they were short-lived, resulting in wasted capital with nothing to show for it.
The criticism was directed squarely at the CEO, with investors alleging that Morishita centralized all game development authority under himself but failed to create any respectable new titles—a track record they find unacceptable. They also revealed that despite the company's poor performance, Morishita's annual salary increased from ¥211 million to ¥329 million over the last 10 years. "Mr. Morishita is not only unfit to serve as a director but also lacks the self-awareness required of a company president," they stated bluntly.
Strategic Capital announced it will launch a dedicated website to provide further details on its proposals and explain to other shareholders why supporting the CEO's dismissal is a necessary action.
GungHo has acknowledged the request for an extraordinary meeting, stating that it will review the contents carefully, but has not yet issued a formal response.
One contributing factor to the company's situation is its massive cash reserve, estimated at over ¥140 billion. This financial cushion is large enough to sustain operations for the next 10 years even without a new hit game, which critics argue has led to corporate complacency.
However, over-reliance on a single popular game is a common phenomenon across the gaming industry, not a problem unique to GungHo. The key difference is that GungHo lacks a traditional console game division capable of releasing new titles regularly. Instead, it must continuously develop new IPs, a high-risk gamble in an industry where the success rate is extremely low. Creating even one iconic game is a monumental achievement.
▼ This year, GungHo launched another *Puzzle & Dragons* spinoff, *Puzzle & Dragons 0*, whose performance is still under evaluation.
This incident has drawn industry attention to GungHo's development struggles and corporate governance issues. It also coincides with growing discontent among the *Puzzle & Dragons* player base regarding the game's design evolution and lackluster collaboration events. In what could be a warning sign for the company, many top-tier players and dedicated YouTubers have recently announced their retirement from the game.
▼ Agepan, a top player known on X for their *Puzzle & Dragons* team-building guides, shocked fans yesterday (July 23) by announcing they were deleting their game data and retiring.
Note: Financial figures and earnings forecasts should be confirmed through the company’s official announcements.
via： Strategic Capital GungHo