Microsoft Surface Chief Panos Panay Abruptly Announces Departure

Panos Panay, Microsoft chief product officer and VP for devices, abruptly announced his departure today after 19 years with the company. 

Panay's most recent role at Microsoft found him in charge of both the Surface hardware line and developing Windows software, an Apple-like dual software/hardware leadership role at Microsoft that was created in 2020. Prior to that, Panay had worked as the chief of hardware at Microsoft - Redmond watchers may recall him as the very enthusiastic Surface salesman at Microsoft device events. 

The reason for the Microsoft executive's departure isn't entirely clear. According to Panay's own statement on X, he's simply "decided to turn the page and write the next chapter," adding that he is grateful for his time at Microsoft. Panay didn't add any additional context or announce additional plans. 

All the while, a previous post from Panay on X indicates excitement about a planned Microsoft Event taking place later this week at which the next Surface device is expected to be unveiled, suggesting his departure may not have been entirely planned - at least not by Panay. 

Microsoft hasn't made a public statement about its Surface guru's departure, though did directly confirm he was leaving to The Register and shared a copy of an internal memo announcing the departure sent to employees by EVP Rajesh Jha that was published elsewhere. While no additional explanation is included in the letter, it does mention several organizational changes being made along with Panay leaving.

Jha said that Windows planning and release management will be handled by a team headed by Pavan Davuluri, currently the head of Windows silicon and systems integration and GM of the Surface team.  That group will also be responsible for building "silicon, systems and devices that span Windows, client and cloud for an AI world," Jha said. 

A new Windows and Web Experiences Team is being formed as well, and Microsoft Consumer and Chief Marketing Officer Yusuf Mehdi will take over leadership of the Windows and Surface businesses with OEM and retail partners. 

Microsoft said it wasn't going to be sharing any other information beyond Jha's message and a quick quote from CEO Satya Nadella, who thanks Panay for the work he'd done at Microsoft and reiterated that the company "remain[ed] steadfast and convicted in our strategy."  

The strategy, maybe - but what of the man behind it?

Panay's departure, as mentioned, just days before a Microsoft hardware event in New York City, is abrupt, but let's be realistic. Barring some intrigue being behind the sudden move it shouldn't come as that big of a surprise. 

The Surface line that Panay managed has long been a loss-maker for Microsoft, and things haven't improved with the continuing post-COVID slump in PC sales. Microsoft has continued to be a profitable company throughout several years of hardware turmoil because of its software and service biz, which have continually performed well despite struggling hardware sales. 

Over the years Panay was in charge of the Surface and Windows groups noted hardware failures like the now out-of-support Surface Duo were released, new Surface devices failed to impress and Panay's attempt to create a "new era of the PC" seemed to be more of the same as opposed to some much-needed innovation. 

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It's also worth remembering that, like the rest of the tech world's new obsession with "all AI all the time," Microsoft is going hard with its AI initiatives. If money had to be repurposed, the recently-reorged and experimentally-structured (for Microsoft) Surface and Windows team, with its integrated hardware and software groups, and perennial underperformance, was pretty ripe for the picking.

While it's not clear that Panay's departure is related, news broke while writing this story that Amazon is reportedly planning to hire Panay to head up its division responsible for Alexa and Echo devices. While it's unknown if that's the case aside from Bloomberg's "sources familiar" with the move, it wouldn't be an out of the blue hire, as Amazon's current Alexa and Echo chief David Limp announced plans to retire last month.

If the reasons have anything to do with deeper changes at Microsoft, and not just Panay's career ambitions, keep an eye out for signs this Thursday at Microsoft's hardware event. ®