Eric Schmidt is stepping down from his role as executive chairman of Alphabet, Google’s parent company, the firm announced Thursday afternoon. Starting at the company’s next board meeting in January, Schmidt will move to a “technical advisor” role while continuing to serve on the board, according to Alphabet’s statement.
For Schmidt, the move comes after 17 years at or near the top of the org chart of one of the world’s most valuable companies. He served as CEO from 2001 to 2011, overseeing Google’s landmark IPO and meteoric rise, before becoming executive chairman.
Rather than directly replace Schmidt, the company said it expects the board to appoint a nonexecutive chairman. That would seem to consolidate the power of the company’s co-founders, Alphabet CEO Larry Page and Alphabet President Sergey Brin. Sundar Pichai remains CEO of Google, which is now a division of the larger holdings firm.
CNBC reports that Schmidt’s new role will likely include advising “the company’s urban development arm, Sidewalk Labs, its deep learning efforts, and its healthcare spin-offs, Verily and Calico.”
Alphabet did not immediately offer a compelling explanation for the unexpected move, which is sure to raise questions. Schmidt said in a statement:
Larry, Sergey, Sundar and I all believe that the time is right in Alphabet’s evolution for this transition. The Alphabet structure is working well, and Google and the Other Bets are thriving. In recent years, I’ve been spending a lot of my time on science and technology issues, and philanthropy, and I plan to expand that work.
Schmidt was hired as the company’s first outside CEO in 2001, having previously served as CEO of Novell, a now-defunct Utah-based software company. It’s widely rumored that he was brought on at the behest of Google’s VC funders to provide “adult supervision” to a then-freewheeling startup run by its co-founders, Larry Page and Sergey Brin. He seemed to winkingly confirm that in 2011, when he quipped upon his transition from CEO to executive chairman, “Day-to-day adult supervision no longer needed!” But he retained a highly influential role at the company and continued to serve in many ways as its public face.
Schmidt departs at a time when Google is still riding high as the world’s second-most valuable corporation by market capitalization, behind only Apple.