Microsoft shuts all 80 brick and mortar stores, goes permanently online

28 Jun 2020 11:24 AM
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Microsoft said Friday it will close most of its retailers and approach its retail businesses online, keeping just four locations and transforming them into “experience centers.”

The move means the more than 80 Microsoft stores closed because of the coronavirus pandemic won't reopen as the tech giant enters “a fresh approach to retail,” according to a statement.

“Microsoft will continue steadily to invest in its digital storefronts on, and shops found in Xbox and Windows,” the statement said.

The four spots which will become Microsoft Encounter Centers are in London, NY, Sydney and at the company’s Redmond, Washington headquarters.

Retail team members will “serve buyers from Microsoft corporate services and remotely providing product sales, training, and support,” the business said.

Microsoft said it'll reserve $450 million to covers the expenses of closing the locations. The number of employees who would be affected had not been immediately available.

“Our sales have become online as our merchandise portfolio features evolved to largely digital offerings, and our talented workforce has verified success serving buyers beyond any physical location,” said Microsoft corporate vice president David Porter.

Microsoft recently has been relying more on its services such as for example cloud computing, with the retail spots focusing on its Surface tablets and laptops together with Xbox gaming gear. However the physical stores failed to gain the momentum of rival Apple.

Independent technology analyst Neil Cybart stated the closures were because “the top business increasingly looks to be losing momentum in the buyer space.”

The impact of the pandemic hasn't yet been reflected in Microsoft’s financial results. It posted a net revenue of $10.8 billion from January to March, up 22 percent year-on-year, on a turnover of $35 billion.

Despite production delays for its Surface range, the group believes it really is well positioned to weather the crisis, thanks in particular to the explosion of cloud computing.

Within an era of social distancing, Microsoft may also depend on its teleworking, distance and education software and services.

However, it has only closed down video game streaming platform Mixer, leaving the discipline available to the industry giant Twitch, owned by Amazon, and its own two rivals, YouTube Gaming and Facebook Gaming.