Microsoft CEO Ballmer To Retire Next Year, Market Likes The News

Unlike his predecessor Bill Gates, Steve Ballmer has had a tougher time of it. To some degree, it’s not his fault. However, the current Microsoft CEO has presided over a period of disruption and decline in the company’s once-dominant market position. It can all be summed up in the following way: Android is now the world’s leading operating system.

This morning, Microsoft announced that Ballmer will retire in the next 12 months.

Ballmer has been CEO of the Redmond, WA-based company since 2000. It’s appropriate for him to retire. However, it may also be that he was “encouraged” to do so by the board and Chairman Bill Gates. I’m sure that news will “out” if it’s true.

There’s a hint that the decision may not have been entirely voluntary in a Ballmer statement, which was released by the company:

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.

(emphasis added.)

Ballmer was a Harvard undergrad who scored a perfect 800 on the math section of the SAT. According to Wikipedia, he dropped out of Stanford Business School to become Microsoft’s 30th employee.

As Microsoft’s core PC market has flattened and the company has largely failed to gain traction in mobile, the calls for Ballmer’s replacement or retirement have grown. Following the announcement this morning Microsoft shares are up on the news (7.5 percent right now). Clearly, the market blames Ballmer (at least in part) for the company’s troubles.

Now the question becomes: will the company turn to an insider or an outsider? A board of directors committee has been created (including Bill Gates) to find Ballmer’s successor.

It won’t be easy to find the right combination of relevant experience, management skill and charisma to “revitalize” the company. But it does represent a great opportunity to do so. I wonder if current CFO Amy Hood will be a candidate.

Postscript: Glassdoor reports that Ballmer has an internal 47 percent approval rating from those Microsoft employees who’ve chosen to rate him on the jobs site.

It has also become relatively clear as the day has progressed that Ballmer is retiring sooner than he would have liked, probably at the prompting or prodding of Gates and the board who believe a leadership change is in order — and it is.