Microsoft's Steve Ballmer to retire in 12 months - WSMV Channel 4

Microsoft's Steve Ballmer to retire in 12 months

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Microsoft announced Friday that CEO Steve Ballmer will be retiring in 12 months as the company seeks a replacement. AP photo Microsoft announced Friday that CEO Steve Ballmer will be retiring in 12 months as the company seeks a replacement. AP photo

By Javier E. David CNBC

(NBC) - Microsoft's 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 terse 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."

Investors applauded the news by sending Microsoft's shares surging in premarket trading by 7 percent -- adding a whopping $24 billion to the software company's market capitalization from Thursday's close.

The news came only months 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.

"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

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