Microsoft has named Satya Nadella as its new CEO. Effective immediately, Nadella will take over from former CEO Steve Ballmer, who announced in August he was retiring.

The news caps off a five-month search for a new leader, during which executives from outside companies like Ford and Qualcomm were considered before the board ultimately went with Nadella, a longtime Microsoft insider. The Indian-born Nadella, 46, arrived at Microsoft 22 years ago and developed a strong reputation within the company's cloud computing division, which he has led for the past seven months..

In a company-wide e-mail sent Tuesday, Nadella hinted he'll be taking Microsoft into a "software-powered world" that evolves alongside new hardware.

"I believe over the next decade computing will become even more ubiquitous and intelligence will become ambient," Nadella wrote. "This will be made possible by an ever-growing network of connected devices, incredible computing capacity from the cloud, insights from big data, and intelligence from machine learning."

Nadella added that his experience has been shaped by a "thirst for learning."

"I buy more books than I can finish. I sign up for more online courses than I can complete. I fundamentally believe that if you are not learning new things, you stop doing great and useful things," he wrote.

Analysts say that Nadella's background in computer science — he holds a master's in the subject from the University of Wisconsin, as well as an MBA from Chicago — will engender respect among Microsoft's competitive, engineer-heavy employee base. Other candidates who did not possess those skills would have had a harder time integrating into the company.

Nadella's familiarity with Microsoft's culture and his perspective near the top of the firm also positions him well to guide the company's future, said Norman Young, an analyst at Morningstar.

"If you're installing someone with a lot of enterprise experience and has a lot of success driving enterprise success, that's pretty good," said Young. "Because the future of Microsoft is almost certainly going to be in the cloud."