Microsoft Will Permanently Close Most of Its Stores

The COVID-19 crisis has forced companies to completely restructure their operations. Some have realized that brick-and-mortar stores will be out of business for a very long time, which means companies will have to focus their efforts on e-commerce strategies, even if it means assuming losses of millions of dollars.

On Friday Microsoft announced that due to "a strategic change in its retail operations," it will permanently close most of its stores. The company will only keep four of them as Microsoft Experience Centers in London, New York, Sydney and on the Redmond campus. According to its page, Microsoft has 83 stores worldwide, 72 of them in the US.

According to Microsoft Corporate Vice President David Porter, the company's focus will be on digital channels. "Our sales have grown online, as our product portfolio has evolved into largely digital offerings, and our talented team has proven successful in serving customers beyond any physical location. We are grateful to our Microsoft Store customers and we look forward to continuing to serve you - online and with our retail sales team at Microsoft's corporate headquarters."

Microsoft said the closings will result in a pre-tax charge of US$450 million in 2Q20. However, the Washington-based company did not mention layoffs.

At the beginning of the year, Microsoft announced the investment in Mexico for the deployment of new Data Centers. Hand in hand with SAS, it announced an alliance to strengthen Artificial Intelligence (AI) analytics and services for the data center market, with which it seeks to improve this technology and make it more accessible to clients in Mexico and to users who are outside the country but have their data stored in Mexico.

"Through this partnership, we seek to help our clients accelerate growth and find new ways to drive innovation and its most critical and complex analytical challenges," said Scott Guthrie, Executive Vice President, Cloud and AI Development at Microsoft.

“Mexico is a very important market for cloud infrastructure due to its location and the number of companies that can work with Microsoft. Although the collaboration agreement is not in force yet, the idea is for both companies to focus on strengthening AI services to optimize the operation of companies and their digitization,” said Jay Upchurch, Executive Vice President and CIO at SAS in a statement.