(Updates from 11:39 a.m. ET with closing information.)
The company announced that Ballmer, 57, will retire after his successor is chosen within the next twelve months. "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." He added that because of the company's ongoing transition into a device and services company, "we need a CEO who will be here longer term for this new direction."
Microsoft's Board of Directors appointed a committee to direct the search for the next CEO, chaired by John Thompson, the board's lead independent director, and includes founder and Chairman of the Board Bill Gates, whom Ballmer succeeded as CEO.
Pandora (P ) shares plummeted 11.65% to $19.18 after the release of mixed quarterly earnings. The Internet radio pioneer beat expectations, earning 4 cents a share on record non-GAAP revenue of $162 million in its fiscal second quarter, a 58% year-over-year increase. Analysts polled by Thomson Reuters, expected the Internet radio company to earn 2 cents a share on revenue of $156.22 million. Its total hours of listening grew 18% year-over-year to 3.88 billion hours and its share of total U.S. radio listening grew to 7.08% from 6.02% in the prior year's quarter. However, guidance was weaker than anticipated. For the third quarter, Pandora expects revenue between $174 million and $179 million and earnings between 3 and 6 cent a share, while analysts were expecting sales of $170.45 million and earnings of 7 cents a share. The company expects total revenues for this fiscal year between $640 million to $655 million and EPS between breakeven and 5 cents; analysts were looking for 5 cents on $634.08 million. "Our second fiscal quarter was an important inflection point in Pandora's history," CEO Joe Kennedy said in a statement. "To drive future growth, we are accelerating investment in new technologies, channels and capabilities that maximize the value Pandora delivers." Wall Street analysts were mixed following the report, with some questioning the impact iTunes Radio will have on Pandora.