Microsoft to permanently close all physical stores

Stores will be "reimagined" and retail teams will work remotely from now on

Microsoft announced on Friday that it would be closing every one of its physical stores permanently as it shifts its retail focus to digital platforms.

Store staff will now work remotely to provide sales, training and support to Microsoft customers. The decision affects 70 stores across the US, as well as a number of outlets in Australia, Canada, Puerto Rico, and the UK.

Microsoft was forced to close its physical stores in response to lockdown measures across the world, and since then its retail teams have been providing support to both commercial and enterprise customers, hosting more than 14,000 online workshops and summer camps.

The tech giant said it had built its retail teams with unique backgrounds and skillsets so it could serve customers from anywhere. The firm hopes to showcase that further with a pipeline of talent with transferable skills.

"The Microsoft Store team has long been celebrated at Microsoft and embodies our culture," said Microsoft CPO 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."

The stores themselves will be "reimagined", according to Microsoft, but into what exactly is unclear. Closing them permanently will result in a pre-tax charge of approximately $450M, the company confirmed, which will be recorded in the current financial quarter ending 30 June 2020. The charge also includes primarily asset write-offs and impairments.

Although Microsoft has said staff will shift to remote working, it's unclear whether the decision will result in any job losses.

The decision comes almost a year to the day that the company opened its first physical UK store on London's Oxford Circus, covering 21,932 square feet over three floors. The site not only housed a retail outlet, but also an interactive zone and a community theatre, used for free STEM and coding workshops.

"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's corporate VP 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."

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