Steve Ballmer, the long-time chief executive of Microsoft, has decided to retire within “the next 12 months,” Microsoft announced this morning.

“There is never a perfect time for this type of transition, but now is the right time,” Ballmer said in a statement. “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.”

Ballmer has been the CEO of Microsoft since January 2000 and had the difficult task of succeeding the legendary Bill Gates. Ballmer joined Microsoft in June 1980 as its 30th employee and its first business manager.

Ballmer wrote an internal Microsoft e-mail that this has been been a difficult decision.

“This is an emotional and difficult thing for me to do,” Ballmer wrote. “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.”

No successor has been named, but Microsoft’s board has appointed a special committee to help choose a new CEO. John Thompson will chair the committee, which also includes former Microsoft CEO Bill Gates, Chuck Noski, and Steve Luczo.

While Microsoft has had some big wins over the past few years like the hugely popular Xbox 360, the successful rebranding of Hotmail to, big gains with its Azure cloud service, and the launch of the new Office 365, it has had trouble in other areas. Its most recent black eye came from the $900 million write-down it took on its disappointing Surface RT tablets.

In response to these developments, Ballmer recently helped oversee a major reorganization of the company to help the company better focus. Microsoft sells an unwieldy number of products and services including Windows, Xbox, Office, Bing, Skype, Azure, Surface, and Windows Server, so the change was needed to “focus on creating a family of devices and services for individuals and businesses that empower people around the globe at home, at work and on the go, for the activities they value most.”

That reorganization drastically benefited a few Microsoft executives, and those few are likely the leading candidates for Ballmer’s job. The list include Julie Larson-Green, who is now in charge of all of Microsoft’s devices and entertainment services (including the Xbox), and Terry Myerson, who now leads operating system development across all of Microsoft’s platforms.

Microsoft’s stock surged more than 9 percent following the news.

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