Microsoft Is Closing All Physical Stores Permanently
Microsoft announced that all physical Microsoft Stores will be closed. The change is part of a “strategic change” and will see Microsoft push more effort and money into its digital storefronts. Microsoft announced the change in a new post today.
Microsoft will “reimagine” some spaces, repurposing them to “serve all customers,” according to Microsoft. The Microsoft Experience Centers in London, New York City, Sydney, and on Redmond campus are among the stores that will be repurposed.
The company tells The Verge that no layoffs will result from today’s decision. “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.
A source with knowledge of Microsoft’s retail operations told The Verge that this plan was originally in place for next year, but was accelerated by the COVID-19 pandemic. Microsoft’s Xbox Series X is launching this holiday, so it makes sense that the company had at least initially planned for the stores to make it that far. The dual-screen Surface Neo device that was also going to ship during the holidays has been delayed, though the Surface Duo is apparently still on track for this year. Still, if you were hoping your local Microsoft Store would be a surefire bet for a new Xbox, you’ll have to look elsewhere.
The big decision partially explains why Microsoft had yet to reopen a single store after they were all closed in light of the pandemic. Last week, Microsoft told The Verge that its “approach for re-opening Microsoft Store locations is measured and cautious, guided by monitoring global data, listening to public health and safety experts, and tracking local government restrictions.” At the time, the company declined to offer an update on when any stores might open again.
Microsoft’s news post states that “The closing of Microsoft Store physical locations will result in a pre-tax charge of approximately $450M, or $0.05 per share.” These will be recorded in the current quarter, which ends on June 30, 2020