Japanese game developer GungHo Online Entertainment recently announced a major leadership change. Kazuki Morishita, the current president and CEO, will step down from his position at GungHo Online Entertainment to become Chief Development Officer and Chairman of the Board of Directors. The move follows months of public pressure from activist investors calling for his removal.

GungHo is best known for creating the popular mobile game Puzzle and Dragons and recently published Nihon Falcom’s Trails in the Sky 1st Chapter.

Since January 2025, activist investor Strategic Capital has pushed for Morishita’s dismissal, calling it necessary to revive GungHo from being a “one-hit-wonder.” The investors criticized Morishita for “lacking awareness of his responsibilities” and pointed to the company’s failure to produce a hit game in the 13 years since Puzzle and Dragons launched. They also highlighted that Morishita’s salary exceeded that of Nintendo’s CEO.

In September, GungHo rejected Strategic Capital’s proposals, saying that removing Morishita “would significantly damage corporate value.” However, just four months later, the CEO announced his resignation. The company has not confirmed whether the investor campaign influenced his decision, stating only that Morishita chose to step down to “devote himself more fully to directing and overseeing game development.”

Starting February 1, 2026, Kazuya Sakai, currently GungHo’s CFO and Executive General Manager of Finance Accounting Division, will take over as president and CEO.

GungHo also announced changes to its pay structure, citing “the company’s recent performance.” Presidential compensation will drop significantly from the previous fiscal year. In fiscal year 2024, total pay for the presidential role was approximately 288.4 million yen (around $1.8 million USD). Under the new system, this amount is expected to decrease by roughly 63% to about 107.7 million yen (around $678,300 USD).