Microsoft announced it will be shuttering 83 retail locations around the world in the wake of the global pandemic. The tech giant will instead direct attention to its online store at Microsoft.com, where customers can go for support, sales, training, and more.
There are a few exceptions, with the company keeping flagships in cities like London, New York City, Sydney, and its own campus in Redmond, Washington open. These locations will be turned into "Microsoft Experience Centers," hubs that allow customers to interact with products, take courses, and do everything except purchase the products.
"Our sales have grown online as our product portfolio has evolved to largely digital offerings, and our talented team has proven success serving customers beyond any physical location," said Microsoft Corporate Vice President David Porter. "We are grateful to our Microsoft Store customers and we look forward to continuing to serve them online and with our retail sales team at Microsoft corporate locations."
Debuting in 2009, The Microsoft Store directly competed with Apple's successful retail model. The tech company even opened a storefront on 5th Avenue in New York City, mere blocks away from Apple's glass cube hub. Each retail location showcased the company's hottest offerings, like its Surface and Xbox devices, plus a variety of PCs.
According to The Verge, the closures won't result in any layoffs. "Our commitment to growing and developing careers from this diverse talent pool is stronger than ever," Microsoft Store VP David Porter said in a LinkedIn post on the move. Notably, the company has also provided its retail staff regular pay throughout the pandemic.
Microsoft also shared that the closing of its retail locations will result in a pre-tax charge of nearly $450 million, or $0.05 per share. It will record this in the current quarter that ended on June 30. "The charge includes primarily asset write-offs and impairments," the company added.
"The company's retail team members will continue to serve customers from Microsoft corporate facilities and remotely providing sales, training, and support," the company shared. "Microsoft will continue to invest in its digital storefronts on Microsoft.com, and stores in Xbox and Windows, reaching more than 1.2 billion people every month in 190 markets."
Microsoft shares were down 2% at closing time Friday, June 26.