Microsoft to Close Physical Retailers, Take US$450 Million Hit
28 June, 2020
Microsoft said on Friday it could close its retail stores and have a related pre-tax asset impairment fee of US$450 million in the current quarter.
The Redmond, Washington-based software giant said would continue steadily to serve customers online, with associates working remotely from corporate facilities.
It had been not immediately sharp if Microsoft's approach would lead to any layoffs.
The business also said it'll rethink other spaces that serve all customers, including operating Microsoft Experience Centers in London, New York City, Sydney, and Redmond campus locations.
"This is a hardcore, but clever strategic decision for [CEO] Nadella & Co. to create at this stage. The physical stores made negligible retail revenue for Microsoft and eventually everything was moving a lot more towards the digital stations over the last couple of years," Wedbush analyst Dan Ives explained in a note.
Retailers, whose stores shuttered in mid-March because of coronavirus-led lockdowns, have seen a huge surge found in online demand amid stay-at-home orders.
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