SAP said its chief executive officer, Bill McDermott, is stepping down and being replaced by board members Jennifer Morgan and Christian Klein as co-CEOs, effective immediately.

In a statement, the SAP said McDermott had decided not to renew his contract and it was activating its long-term succession plan.

Bill McDermott

McDermott, who has been CEO of the German software giant for more than nine years, will remain with the company as an adviser until the end of the year.

“SAP would not be what it is today without Bill McDermott,” Hasso Plattner, chairman of the supervisory board, said in a statement. “Bill and I made the decision over a year ago to expand Jennifer and Christian’s roles as part of a long-term process to develop them as our next generation of leaders.”

SAP had a co-CEO structure in 2010 when McDermott was promoted to the role with Jim Hagemann Snabe, but Snabe departed in 2014, leaving McDermott the sole CEO.

In a tweet, McDermott said, “Every CEO dreams of handing an exceptionally strong company to its next generation. Today we did it for SAP. I love the people of this company. I couldn’t be prouder of what we did.”

SAP has also recently seen the departures of Brigette McInnis-Day, chief operating officer of SuccessFactors, and Robert Enslin, the president of its cloud business. McInnis-Day and Enslin both joined Google Cloud.

In April, activist investor Elliott Management disclosed it had taken a $1.35 billion stake in the company and shared SAP management’s goal of increasing operating margins by 5%.

A spokesperson for Elliott told TechCrunch they had did not have an immediate comment on McDermott’s departure.

In the same statement, SAP announced it was reporting its third-quarter results early, highlighting revenue growth and margin expansion. The company said new cloud bookings increased 38% in the quarter and that one deal with a major partner accounted for 17% of the new cloud growth.

The company’s stock is up 21% this year, and up 75% in the past five years.

Uwe Anspach/picture alliance via Getty Images

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