Microsoft closes all physical shops in mainland China

2 days ago 2

Microsoft has reportedly shut down its stores across mainland China, however customers will still be able to buy products through partners and on the Microsoft online store.

The South China Morning Post claims Microsoft will focus on sales through channels, enhancing partnerships with third-party retailers and boosting its online presence.

The move marks a significant shift in the way Microsoft does business in the world’s second-largest economy, potentially hinting at a broader sales strategy that could be applied globally.

Microsoft closing Chinese stores

Though it is currently ranked as the world’s most valuable company, with a market cap of $3.413 trillion, Microsoft’s portfolio spans more than just hardware. Compared with Apple, which sits in Microsoft’s shadow with a market cap of $3.377 trillion, the company's Surface hardware hasn’t proven quite as popular.

Declining interest and poor profits from physical stores could also be partly to blame for Microsoft’s decision to shut the doors to all of its Chinese stores.

The South China Morning Post cites three unnamed distributors stating that Microsoft’s stores were given until June 30 to close. Operating as franchise businesses, the stores were previously exempt from the company’s 2020 decision to close more physical stores worldwide. Key sites in London, New York City, Sydney and at its Redmond Campus currently remain open.

In addition to closing its retail stores in China, Microsoft has also been relocating employees from the country, offering them positions in the US, Australia, New Zealand and Ireland.

Company President Brad Smith also revealed that China accounts for only 1.5% of Microsoft’s total revenue at a recent congressional hearing, raising questions about its future in the country.

TechRadar Pro has asked Microsoft to confirm some details about the reports, but the company did not immediately respond.