Microsoft Permanently Closes All Physical Stores, Takes A $450 Million Hit.

Microsoft

After temporarily closing its Microsoft Stores in March because of the pandemic, the company has decided to make it permanent, announcing Friday that the move will “result in a pre-tax charge of approximately $450 million” which “includes primarily asset write-offs and impairments.”

Microsoft shares stumbled during Friday trading, falling more than 2% to trade at $195.

The company’s retail team members will serve customers from Microsoft corporate facilities and remotely.

Microsoft will continue to invest in its digital storefronts on Microsoft.com, and stores in Xbox and Windows, which it says reach more than 1.2 billion people every month in 190 markets.

Microsoft will “reimagine” other spaces that serve all customers, including operating Microsoft Experience Centers in London, New York and Sydney and at its Redmond campus locations.

Since Microsoft Store locations closed in late March, the company says the team has hosted more than 14,000 online workshops and summer camps and more than 3,000 virtual graduations.

“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.

Microsoft started expanding its retail presence in 2009, offering customers the experience to see its Windows and Xbox devices and get in-person customer support. It drew parallels to Apple’s retail strategy and store design. Microsoft’s New York store on Fifth Avenue is just blocks away from Apple’s glass cube store. Another similarity? Microsoft’s stores feature an “Answer Desk” that seems like a nod to Apple’s “Genius Bar.”

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