The world’s largest software maker Microsoft Corp. (MSFT) announced that ex-Chief Executive Officer (CEO) Steve Ballmer resigned from its board.
The 58-year-old Ballmer retired from his position as the CEO eight months ago ending his nearly 13 years’ (Jan 2000 to Feb 2014) career at Microsoft. Following his retirement, 46-year-old Satya Nadella was named the new CEO.
Ballmer said that his departure would give him more to spend on his recently acquired basketball team — Clippers — for $2 billion.
Ballmer took over the reins of the company as CEO in Jan 2000 when Microsoft was unable to keep pace with the changing technology trends and generate growth. The company was facing stiff competition from peers such as Apple Inc. (AAPL), Google Inc. (GOOGL) and Facebook Inc. (FB) in the areas of Internet search, smartphones and tablets. Also, Ballmer’s efforts to launch innovative products failed to reignite the company's growth.
Nevertheless, revenues increased threefold during Ballmer's tenure. He also introduced a series of functional and executive changes to help the company gain traction in the fast-growing mobile and cloud-computing markets.
Currently, Ballmer remains the biggest individual shareholder, owning 333.3 million Microsoft shares worth $15 billion, according to data compiled by Bloomberg. Ballmer plans to retain his stock and continue to offer feedback on products and strategy.
Ballmer’s departure did not have any major impact on the share price which increased only 0.5% to $45.33. However, ever since he stepped down as the CEO, Microsoft’s shares have surged about 24%.
Ballmer’s retirement has given the new CEO Nadella a free hand to reshape and restore the company’s position. It is yet to be seen whether Nadella can ramp up the high-growth, high-margin service operations and the highly competitive, low-margin but strategically important devices business.
Currently, Microsoft has a Zacks Rank #3 (Hold).
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