Microsoft on Friday announced it will permanently close its 83 Microsoft Store retail locations. It will instead focus on its online store at Microsoft.com, where customers can go for support, sales, training and more.
Microsoft said its retail team members will help on the website instead of in-store. A Microsoft spokesperson told CNBC that all the employees will have the opportunity to stay with the company.
"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," Microsoft Corporate Vice President David Porter said in a blog post. "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."
Shares of Microsoft closed down 2% on Friday.
In the past decade or so, Microsoft began to expand its retail presence in an effort to create a shopping experience similar to Apple's, where people could go to try new Microsoft software and hardware created by both Microsoft and its partners. Microsoft even built a store on 5th Avenue in New York City, just blocks away from Apple's iconic glass cube store.
The decision seems to be made after Microsoft decided to temporarily close stores in March due to the spread of the coronavirus. Microsoft said the closing of its physical locations will "result in a pre-tax charge of approximately $450 million, or $0.05 per share," which it will record in the current quarter that ends on June 30. "The charge includes primarily asset write-offs and impairments," the company said.
"Microsoft will continue to invest in its digital storefronts on Microsoft.com, and stores in Xbox and Windows, reaching more than 1.2 billion people every month in 190 markets," it said. "The company will also reimagine spaces that serve all customers, including operating Microsoft Experience Centers in London, NYC, Sydney, and Redmond campus locations."