Software vendor instead will invest more in its online retail operations
Microsoft, which, like Apple and other companies closed its physical stores as the coronavirus outbreak took hold around the world, will not reopen its retail operations, opting instead to focus on its online business.
The Lowdown: In a statement released Friday, the software and cloud giant said shuttering the retail stores will result in a pre-tax charge of about $450 million.
The Details: Microsoft’s decision comes at the same time that Apple is having to reclose some stores in states like Arizona, Florida, and Texas that have seen significant spikes in COVID-19 cases. Both companies closed their stores in March due to the pandemic, but Microsoft said its decision to keep its stores closed is due to the growth of its online operations since the closures.
During that time, the company’s retail team has worked with small businesses and educational institutions to adapt to work-from-home and distance-learning challenges, virtually trained hundreds of thousands of enterprise and education customers on remote work and learning software, and supported them via calls. The Microsoft employees hosted more than 14,000 online workshops and summer camps and more than 3,000 virtual graduations.
The company will continue to invest in such efforts going forward, according to Microsoft Corporate Vice President David Porter. Microsoft has seen significant growth through its digital storefronts, such as Microsoft.com and those for Xbox and Windows, and is offering new services like 1:1 video chat support, online tutorial videos, and virtual workshops. More services are coming, the company said.
Microsoft said it will revamp spaces that serve a broad array of customers, such as Microsoft Experience Centers in London; New York; Sydney, Australia; and its Redmond, Washington, campus.
The Buzz: “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,” Porter said. “It is a new day for how Microsoft Store team members will serve all customers. We are energized about the opportunity to innovate in how we engage with all customers, maximize our talent for greatest impact, and, most importantly, help our valued customers achieve more.”
“The Microsoft Store team has long been celebrated at Microsoft and embodies our culture,” said Microsoft Chief People Officer Kathleen Hogan. “The team has a proven track record of attracting, motivating, and developing diverse talent. This infusion of talent is invaluable for Microsoft and creates opportunities for thousands of people.”