Microsoft continues to scale back its operations in Russia, with a notable development for one of its local subsidiaries.
Reuters cited a note filed on the official Fedresurs registry on Friday as revealing that one of Microsoft subsidiaries in Russia plans to file for bankruptcy.
Soon after Russia’s illegal invasion of Ukraine in February 2022, Microsoft and other Western tech giants such as Apple, Google, Samsung, Intel, Qualcomm, TSMC began scaling back their operations in that country, as Western nations slapped punishing sanctions against Vladimir Putin’s country.
Russian exits
Then in March 2022, software giants including Microsoft and IBM announced they had suspended all its business in Russia and also halted all new sales.
Microsoft at the time said it suspending new sales of its products and services in Russia, and is “proactively” working “to help cybersecurity officials in Ukraine defend against Russian attacks.”
The software giant also said they would work with the US, UK and EU to stop any aspects of their business that would breach any sanctions.
For example in June 2022 Microsoft said it was ‘substantially reducing’ its business in Russia and would axe 400 local employees.
However it admitted that it would continue to fulfil its existing contractual obligations with Russian customers while the suspension of new sales remains in effect.
At the same time IBM closed down its Russian operation and axed hundreds of staff, while Taiwan banned most chip exports to Russia.
The Russian unit of Google was declared bankrupt by a court in Moscow in October 2023, but that didn’t stop Russia in November 2024 demanding that Google pay a fine worth more than the world’s total GDP, over YouTube bans on pro-Russian media outlets.
Microsoft Russia bankruptcy
Now according to Reuters, one of Microsoft’s subsidiaries in Russia plans to file for bankruptcy, although it noted that Redmond did not immediately respond to an emailed request for comment.
It comes after Russian President Vladimir Putin said this week that foreign service providers like Microsoft and Zoom should be “throttled” in Russia to make way for domestic software solutions.
Microsoft (like Google) had already removed Russian state-owned media outlet RT’s mobile apps from the Windows App store and banned advertisements on Russian state-sponsored media in the days after the invasion.
Reuters reported that the note posted on Fedresurs on Friday said that Microsoft Rus LLC was intending to declare bankruptcy.
But according to the TASS news agency, Microsoft still has three other Russian units, namely Microsoft Development Centre Rus, Microsoft Mobile Rus and Microsoft Payments Rus.
Reuters noted that it was not immediately clear how those units might be affected by a bankruptcy declaration by Microsoft Rus LLC.