Microsoft Is Shutting Down All of Its Retail Stores

Microsoft Surface Duo

Microsoft announced a strategic change Friday, planning to close all physical store locations.

How delightful! - "including closing Microsoft Store physical locations".

In a post on Linkedin, David Porter, corporate vice president, Microsoft store has listed three areas where the company aims to serve their customers. "We're grateful to our Microsoft Store customers and we look forward to continuing to serve them online". Four high-profile stores - Manhattan (Fifth Ave.), London (Oxford Circus), Sydney, Australia (Westfield Sydney) and Redmond, Washington - will be turned into "Microsoft Experience Centers" where customers will be able to experience product, see demos, explore device bars and learn about technology.

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.

Microsoft isn't the only company that is closing stores. The first store opened in 1999, and closed in 2001. In the United States where a cautious strategy is taken to re-establish the retail operations to prevent this pandemic coronavirus from circulating again, most shopping centers remain closed.

The Microsoft Store is survived by its digital counterpart and the company's 1-800 technical support hotline. It followed a similar formula to Apple Stores. The team has hosted over 14,000 virtual workshops and camps and more than 3,000 online graduations since March. The company will continue to invest in digital innovation with new services including 1:1 video chat support, online tutorial videos and virtual works.

Unfortunately for some, getting to one of these stores will now only be possible in very few select locations. On a related note, Microsoft says that staff that working at its numerous retail outlets will not be laid off and instead, will be diverted and placed in other divisions within the company. Microsoft, with its strong balance sheet, certainly could afford to continue operating physical stores. 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.

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