Microsoft said Friday that it will close all of its stores and move its online retail operations, maintaining just four locations and transforming them into “experience centers.”
The move means that the more than 80 Microsoft stores closed due to the coronavirus pandemic will not reopen as the tech giant enters “a new approach to retail,” according to a statement.
“Microsoft will continue to invest in its digital storefronts on Microsoft.com and on Xbox and Windows,” the statement said.
The four locations that will become Microsoft Experience Centers are located in London, New York, Sydney, and at the company’s headquarters in Redmond, Washington.
The retail team members “will serve customers of Microsoft’s corporate facilities and remotely provide sales, training and support,” the company said.
Microsoft said it will set aside $ 450 million to cover the costs of closing the locations. The number of employees who would be affected was not immediately available.
“Our sales have grown online as our product portfolio has evolved into largely digital offerings, and our talented team has proven successful in serving customers beyond any physical location,” said Microsoft Corporate Vice President David Porter.
In recent years, Microsoft has been relying more on its services, such as cloud computing, and retail locations focus on its Surface tablets and laptops, as well as Xbox gaming gear. But physical stores failed to gain momentum from rival Apple.
Independent technology analyst Neil Cybart said the closings were due to “the Surface business increasingly appearing to be losing momentum in the consumer space.”
The impact of the pandemic has yet to be reflected in Microsoft’s financial results. It posted a net profit of $ 10.8 billion from January to March, an increase of 22 percent year-over-year, with a turnover of $ 35 billion.
Despite delays in the production of its Surface range, the group believes it is well positioned to withstand the crisis, in particular thanks to the explosion of cloud computing.
In an era of social estrangement, Microsoft can also count on its teleworking, distance learning, and education software and services.
However, it has just closed the Mixer video game streaming platform, leaving the field open to industry giant Twitch, owned by Amazon, and its two rivals YouTube Gaming and Facebook Gaming.