NEW YORK — Microsoft CEO Steve Ballmer, who took over the helm of the world's largest software company from founder Bill Gates, will retire within the next year.
Microsoft Corp. did not name a successor, but said the company is forming a search committee, which will include Gates. Ballmer will stay on until a replacement is found.
"There is never a perfect time for this type of transition, but now is the right time," Ballmer, 57, said in a statement released by the Redmond, Wash., company.
After the news broke, Microsoft's stock shot up as much as 9 percent shortly after the markets opened. The shares came within two dollars of their 52-week high.
Microsoft has recently struggled under Ballmer. The CEO's announcement comes less than two months after the company unveiled a sweeping reorganization of its business in an attempt to reignite competition with faster-moving rivals such as Apple and Google.
Although it derives some three-quarters of its revenue from sales of software and services to businesses large and small, the company has failed to capture the imagination of consumers who have become more enamored with mobile gadgets than PCs.
Response to the newest version of its flagship Windows operating system, Windows 8, has been lukewarm. And Microsoft, along with other companies that thrived in the era of personal computers, is scrambling to transform its business as people increasingly come to rely on smartphones and tablets.
In his statement, Ballmer noted that the company is moving in a new direction and needs a CEO that will be there for the longer term.
Microsoft, he added, "has all its best days ahead."
Ballmer met Gates in 1973 while they were living down a dormitory hall from each other at Harvard University. He joined Microsoft in 1980 to bring some business discipline and salesmanship to a company that had just landed a contract to supply an operating system for a personal computer that IBM would release in 1981.