Microsoft permanently closing nearly all of its stores

Joanna Estrada
June 30, 2020

Microsoft's approximate pre-tax charge of $450 million or 5 cents per share - which primarily includes asset write-offs and impairments - will be recorded in the current quarter that ends June 30.

The announcement highlighted the tech giant's effort to reallocate its retail resources to a remote platform in light of the initial March store closings that resulted from the COVID-19 pandemic.

Comparisons to Apple and its chain of retail stores have shadowed Microsoft since it first broached the idea of building out a physical footprint in the U.S. In some cases, Microsoft leased mall space very near existing Apple stores, exacerbating the inevitable contrasts when the former's outlets could not match the latter's crowds.

Microsoft said it would "reimagine" its Microsoft Experience Centers on its Redmond, Wash., headquarters campus and in New York City, London and Sydney, Australia, to serve all customers - including consumers and small business, education and enterprise customers - and allow them to experience Microsoft products and services.

"Speaking over 120 languages, their diversity reflects the many communities we serve", Microsoft Corporate Vice President David Porter said of the company's retail employees in a statement.

Both the kiosks and the inside-Best Buy spaces were created to sell customers on Windows 8 and the then-new Surface hardware, as well as new PCs and devices from other OEMs (original equipment manufacturers).

Since the physical store closures, Microsoft has kept its retail store staff busy helping serve customers by remotely providing sales, training, and support.

"We deliberately built teams with unique backgrounds and skills that could serve customers from anywhere", Porter said. Currently, it has 72 stores in the U.S., seven in Canada and one each in the UK, Australia, Puerto Rico and Finland.

No layoffs were announced alongside the brick-and-mortar closings.

The company is also offering virtual product demos, customer support, online tutorials and workshops to support online sales.

The company will reportedly focus on digital retail, stating Microsoft.com and the Xbox and Windows storefronts reach "up to 1.2 billion monthly customers in 190 markets". "Our commitment to growing and developing careers from this talent pool is stronger than ever".

Webbush analyst Daniel Ives on Friday, commented, "This is a tough, but smart, strategic decision.The physical stores generated negligible retail revenue for MSFT and ultimately everything was moving more and more towards the digital channels over the last few years".

Earlier this month, Microsoft opened an artificial intelligence centre for energy in Dubai to experiment with technologies that could be used globally.

Other reports by Click Lancashire

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