Microsoft's key Russian division declares bankruptcy filing.
Tech Giant Microsoft's Russian Subsidiary on the Brink of Bankruptcy
In a shocking turn of events, Microsoft's main subsidiary in Russia, Microsoft Rus LLC, is preparing to file for bankruptcy.
A note on the official Fedresurs registry, Russia's central platform for disclosing company activities, hints at this move. The note mentions that Microsoft Rus LLC intends to declare bankruptcy.
This company carries the responsibility for Microsoft's marketing, localization, and partner relations within the country. It also operates three other subsidiaries: Microsoft Development Centre Rus, Microsoft Mobile Rus, and Microsoft Payments Rus, each with their respective roles in software development, mobile technologies, and financial transactions.
Pulling the Plug
Citing a changing economic outlook and the impact on their operations, Microsoft in June 2022 announced the scaling down of its operations in the country. Initially, the company continued providing key services even when Western nations imposed significant sanctions in response to Russia's invasion of Ukraine.
Microsoft's response to the invasion included the removal of Russia Today (RT)'s mobile apps from the Windows App store and a ban on advertisements on Russian state-sponsored media.
Sales Drops and Bankruptcy Rise
Microsoft is not alone in this predicament. Countless foreign firms have either discontinued or are reducing their operations in Russia. A wave of mass bankruptcies of foreign companies is sweeping through the Russian courts, with Google's local subsidiary also filing for bankruptcy in 2022.
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The ensuing war and sanctions have taken a heavy toll on Western tech companies' presence in Russia. The Russian President, Vladimir Putin, has urged these companies to be "throttled" and "choked" in Russia as part of his strategy to promote domestic technology and minimize dependence on foreign platforms.
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The impending bankruptcy of Microsoft Rus LLC in Russia is a significant development in the general-news landscape, signifying the potential demise of a key player in the country's technology industry and finance sector. This move comes as a wave of mass bankruptcies of foreign companies, including Google's local subsidiary, sweeps through the Russian courts, symptomatic of the heavy toll the ensuing war and sanctions have taken on Western tech companies. Meanwhile, Russian politics continues to emphasize the need for domestic technology and minimizing dependence on foreign platforms.
