Microsoft's (MSFT) CEO Steve Ballmer shocked markets on Friday by announcing he would step down within 12 months, ending a tenure marked by the software giant's declining dominance and struggles to keep pace with its competitors.
In a statement, Microsoft said Ballmer would retire "upon the completion of a process to choose his successor. In the meantime, Ballmer will continue as CEO and will lead Microsoft through the next steps of its transformation to a devices and services company that empowers people for the activities they value most."
Market scrutiny will now likely shift to who will be tapped to succeed Ballmer. Despite that uncertainty, investors applauded the news by sending Microsoft's shares surging by 7 percent - adding a whopping $24 billion to the software company's market capitalization from Thursday's close.
The news came only a month after the Redmond-based technology behemoth announced a broad reorganization, designed to capitalize on the relentless shift toward mobile technology. Ballmer acknowledged the strategic shift, as he complemented the new leadership team.
(More from CNBC: To land a job, take these six college courses)
"There is never a perfect time for this type of transition, but now is the right time," Ballmer said in a statement.
"My original thoughts on timing would have had my retirement happen in the middle of our company's transformation to a devices and services company," he added. "We need a CEO who will be here longer term for this new direction."
Ballmer succeeded billionaire Bill Gates in 2000, the iconic wunderkind whose knack for technology innovation was rivaled only by deceased Apple (AAPL)CEO Steve Jobs. Yet like Apple's current CEO Tim Cook, Ballmer was forced to wrestle with comparisons to his predecessor, despite a much more flamboyant personal style that made for several viral videos.
(More from CNBC: Wal-Mart is snatching up Silicon Valley talent, CEO says)
Under Ballmer's leadership, Microsoft's stock languished and its rivals - most of whom moved rapidly to profit from the explosive growth of smartphones and tablets - began separating themselves from the rest of the technology pack.
More From CNBC
- Is this Apple's rumored gold iPhone?
- Icahn: Meeting Apple's Cook next month on buybacks
- Yahoo beats Google to top spot for US web traffic
- Information Technology
- Technology & Electronics
- Steve Ballmer