Microsoft CEO Steve Ballmer Will Retire in the Next Year

Microsoft just announced that its CEO, Steve Ballmer, will retire within the next 12 months. He'll remain in his current position until Microsoft finds his replacement.

Ballmer has been with Microsoft since 1980, and has been CEO since 2000. A special committee—which includes chairman Bill Gates—has been formed to find his replacement. Something obvious, but interesting to see laid out explicitly, is that Ballmer and the new CEO will continue to oversee Microsoft's "transformation to a devices and services company," so the new CEO will likely have a background in hardware or services.

Earlier this year Ballmer was part of a failed attempt to purchase the Sacramento Kings and relocate them to Seattle, where Microsoft is located. Ballmer briefly served as head of the Xbox division last month, before former Windows executive Julie Larson-Green was named successor.

In recent years, Ballmer has been a polarizing figure at Microsoft, with many believing he's responsible for the stagnation of Microsoft, and the culture of Microsoft not being able to get out of its own way long enough to enjoy successes that should be a matter of course.

His departure will offer Microsoft a chance to change how its corporate structure works. Ballmer will be the latest key executive to leave the company, following former Xbox chief Don Mattrick and Windows boss Steven Sinofsky.

Ballmer sent out an internal email going over his decision, which Microsoft has posted under the title Moving On. It has the expected optimistic beats regarding the company's future, and reflects the cumulative success of Microsoft over Ballmer's tenure at the company, but seems to lack that central, recent success that will keep Microsoft moving forward. Here is the letter in its entirety:

I am writing to let you know that I will retire as CEO of Microsoft within the next 12 months, after a successor is chosen. There is never a perfect time for this type of transition, but now is the right time. My original thoughts on timing would have had my retirement happen in the middle of our transformation to a devices and services company focused on empowering customers in the activities they value most. We need a CEO who will be here longer term for this new direction. You can read the press release on Microsoft News Center.

This is a time of important transformation for Microsoft. Our new Senior Leadership team is amazing. The strategy we have generated is first class. Our new organization, which is centered on functions and engineering areas, is right for the opportunities and challenges ahead.

Microsoft is an amazing place. I love this company. I love the way we helped invent and popularize computing and the PC. I love the bigness and boldness of our bets. I love our people and their talent and our willingness to accept and embrace their range of capabilities, including their quirks. I love the way we embrace and work with other companies to change the world and succeed together. I love the breadth and diversity of our customers, from consumer to enterprise, across industries, countries, and people of all backgrounds and age groups.

I am proud of what we have achieved. We have grown from $7.5 million to nearly $78 billion since I joined Microsoft, and we have grown from employing just over 30 people to almost 100,000. I feel good about playing a role in that success and having committed 100 percent emotionally all the way. We have more than 1 billion users and earn a great profit for our shareholders. We have delivered more profit and cash return to shareholders than virtually any other company in history.

I am excited by our mission of empowering the world and believe in our future success. I cherish my Microsoft ownership, and look forward to continuing as one of Microsoft’s largest owners.

This is an emotional and difficult thing for me to do. I take this step in the best interests of the company I love; it is the thing outside of my family and closest friends that matters to me most.

Microsoft has all its best days ahead. Know you are part of the best team in the industry and have the right technology assets. We cannot and will not miss a beat in these transitions. I am focused and driving hard and know I can count on all of you to do the same. Let’s do ourselves proud.

Steve