Microsoft CEO Steve Ballmer has announced he is to retire.
Ballmer said he will leave the company within 12 months as soon as his successor is chosen.
Microsoft recently went through a major structural change following perceived struggles in many of its core businesses, including Windows and its mobile devices division. The company recently incurred a $900 million write-down after poor sales of its Surface RT tablets.
Shares in the company jumped more than 8% in pre-market trading after the news was announced.
Microsoft said: "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."
It also published a "highlights reel" of Ballmer's career, which is copied above.
Ballmer, who is 57, took over Microsoft in 2000 after founder Bill Gates stepped down. He was hired by Microsoft 33 years ago in 1980, and was the company's 30th employee.
In a statement Ballmer said that "there is never a perfect time for this type of transition, but now is the right time."
He said:
"We have embarked on a new strategy with a new organization and we have an amazing Senior Leadership Team. 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. We need a CEO who will be here longer term for this new direction."
In a longer farewell to employees, published in full on The Verge, Ballmer said that he would miss the company, which has grown from $7.5 million in value to more than $78 billion since he joined.
He said:
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.
The company said it had appointed a special board - including Bill Gates as a member - to run the process, and that Ballmer would stay in control of the company until it names the next CEO. The recruitment firm running the search is has the slightly unfortunate name "Heidrick & Struggles".
“As a member of the succession planning committee, I’ll work closely with the other members of the board to identify a great new CEO," said Gates. “We’re fortunate to have Steve in his role until the new CEO assumes these duties."