Microsoft to spend $450 million to shut down all retail stores

Tuesday, 30 Jun, 2020

Microsoft announced on Friday that it would permanently terminate its 83 Microsoft retail stores. While the retail industry has been hit pretty hard by the ongoing pandemic, Microsoft has opted for the nuclear option and will close all of its physical stores, resulting in a $450M write-off for the company.

The death of Microsoft Stores comes as a surprise, however, this isn't the end for physical appearances from the tech giant.

"It is a new day for how Microsoft Store team members will serve all customers", continues Porter.

Microsoft temporarily closed its physical stores back in March in the wake of the coronavirus outbreak, just like many other companies.

Microsoft said it will continue to operate Microsoft Experience Centers at company campuses in London, New York City, Sydney, and Redmond, Wash.

Microsoft Corp. said the closures would result in a pretax charge of about $450 million United States, or five cents per share, taken in the current quarter ending June 30. Microsoft stores are nearly always empty.

Last week, Microsoft said that it was listening to public health and safety experts before reopening the stores.

Microsoft announced its plan to begin opening stores in 2009 ahead of the release of Windows 7 after Apple saw significant success and popularity with its modern, clean retail outlets. Each store showcased Microsoft's Xbox and Surface hardware, as well as a selection of third-party PCs.

"Microsoft will continue to invest in its digital storefronts on Microsoft.com, and stores in Xbox and Windows", the statement said.

The company expects that new online services will include one on one video chat support, online tutorial videos, virtual workshops and more. Then they are connected to their nearby retailer, who guides them, processes payment and then gives them a time to pick the device from the store. But while Microsoft has built Surface into a profitable business with $2B in sales, the company hasn't built the same brand cachet as Apple or won an equivalently-sized fan base. However, these will be reimagined as "Microsoft Experience Centers".