Microsoft’s J.K. Smith will become its CEO after three years as chief operating officer, according to a person familiar with the matter.
Smith, who will assume the role in late March, will remain as CEO through the end of 2017 and is expected to take the company’s current $2.6 billion annual compensation package, which includes stock options.
He will have about $2 million per year left on the deal, the person said.
The decision comes amid speculation that Microsoft could seek to raise its CEO pay in line with Google Inc.’s Google Glass and Apple Inc.’
S AAPL 0.30% iPhones.
Smith is a veteran executive with a history of building and managing software projects, which is important given the company is seeking to diversify its software portfolio and focus on new revenue streams.
The company has been trying to find a way to diversified its software offerings to attract users, while also creating new revenue opportunities from new software platforms and applications, such as Cortana and its Bing search engine.
Microsoft is expected in early 2019 to release a new version of Windows 10, which it says will be a more comprehensive operating system that will have the most advanced features.
The company is also considering releasing a new smartphone and tablet operating system, called Windows 10 Pro, that would be optimized for businesses, analysts said.
Microsoft has been building a mobile and cloud computing platform, Windows 10 IoT, for businesses since the end-of-2015.
Microsoft said in January that it would no longer support its mobile operating system on smartphones and tablets.
It also stopped making smartphones in 2017 and began offering devices with Windows 10.