by Kyle Woodley | August 23, 2013 9:35 am
Microsoft (MSFT) opened solidly higher Friday after the company announced that longtime CEO Steve Ballmer would be stepping down “within the next 12 months.”
The move comes amid years of struggling on the part of the PC-centric giant, despite the stock’s market-beating year-to-date run.
Microsoft’s mobile efforts recently ran into a brick wall, with the company recording a $900 million writedown on its Surface RT tablets as it failed to gain much traction against competitors like the Apple (AAPL) iPad, among others.
That writedown hammered Microsoft’s fourth-quarter earnings, which came to $5 billion — a jarring pivot from three months before when MSFT reported go-go Q3 profits of $6.06 billion. That led to a sizable selloff in Microsoft stock, which cut into a sizable 2013 rally.
Nonetheless, Steve Ballmer’s time at Microsoft has been marked by stagnant stock performance — MSFT has traded between the high $20s and low $30s for most of the past decade — leading some to question whether the clock was ticking for Ballmer.
In a Microsoft press release, Ballmer said, “There is never a perfect time for this type of transition, but now is the right time,” adding that the company needed a CEO “who will be here longer-term” as the company “transforms to a devices and services company.”
Microsoft has appointed a special committee to find Steve Ballmer’s replacement that includes Chariman and co-founder Bill Gates.
Kyle Woodley is the Deputy Managing Editor of InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities. Follow him on Twitter at @IPKyleWoodley.
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