Julie Larson-Green, who joined with Sinofsky in presenting Windows 8 to the media on Oct. 25 in New York, has been promoted to run all Windows software and hardware engineering, Microsoft said.
While the company offered little explanation, both Sinofsky and chief executive Steve Ballmer — to whom Sinofsky was once touted as a possible successor — were gracious in their statements.
Still, there was immediate speculation that the company had become worried over Sinofsky's ability to get along with other executives, including Ballmer, given a new emphasis on collaboration.
Reuters reported Tuesday that one former Microsoft staffer who worked with Sinofsky had said his aggressive style exasperated other leaders and may have alienated too many people, including his mentor, Microsoft founder Bill Gates.
There was a similar departure at rival Apple on Oct. 30, when Scott Forstall, senior vice president for iPhone and iPad software, left the company. While he had long prospered under Apple founder Steve Jobs as an inventive loner and developer of mobile-device software, Apple said it wanted to encourage "even more collaboration" among its teams.
Ballmer appears to be putting in place a new team to start planning the next upgrade, Bloomberg reported, citing a person familiar with the company. New products and management shifts are aimed at helping the company withstand pressure from Apple and other mobile device makers that are winning over consumers and businesses.
Microsoft shares dropped 4.5 per cent to $26.96 US in early trading Monday, then rebounded to $27.21 on the Nasdaq stock market. The Nasdaq 100 index was little changed at 2,584.
In a statement, Ballmer expressed gratitude for Sinofsky's contribution to the company. He indicated the need for the company to further integrate its array of offerings, which in addition to Windows includes services such as Bing, Skype and Xbox and a new tablet computer, as it begins what he called "a new era at Microsoft."
And Sinofsky was grateful for his long run at the company — he began there in 1989, soon after graduating from the University of Massachusetts with a masters degree in mathematics.
"It is impossible to count the blessings I have received over my years at Microsoft," he said in a statement. "I am humbled by the professionalism and generosity of everyone I have had the good fortune to work with at this awesome company."
Ballmer said "it is imperative that we continue to drive alignment across all Microsoft teams, and have more integrated and rapid development cycles for our offerings."
The launch of Windows 8 last month heralded the biggest change to the industry's dominant operating system in at least 17 years. It attempts to bridge the gap between personal computers and fast-growing tablets with its touch-enabled interface.
Sinofsky originally joined Microsoft as a software design engineer. Before heading the Windows division, his work included overseeing the development of Microsoft Office products.
Larson-Green has been with Microsoft since 1993. She was responsible for program management, user interface design and research, as well as development of all international releases for Windows 7 and Windows 8, Microsoft said.
In her new role, she will be responsible for all future Windows product development in addition to future hardware projects.