Two top Microsoft executives, Tony Bates and Tami Reller, are reported to be leaving the company as part of a management reshuffle by the company’s new CEO Satya Nadella.

Mark Penn will also become chief strategy officer, according to the New York Times, giving him a bigger hand in determining which markets Microsoft should be in and where it should be making further investments.

Mr Penn was an executive vice president at Microsoft overseeing advertising and strategy.

Mr Bates, the former Skype CEO in charge of Microsoft's business development, will leave immediately, technology news site Re/code reported on Sunday citing unnamed sources.

Mr Bates, who has also worked at Cisco Systems, was considered one of the potential CEO candidates to succeed Steve Ballmer, who announced in August that he would retire.

Eric Rudder, head of advanced strategy, will temporarily take up Mr Bates' duties and marketing executive Chris Capossela will replace Ms Reller, the report said.

Ms Reller, one of the top female executives at the company and co-head of Microsoft's Windows unit, will remain with the company for some time to help with the transition.

The report said Mr Nadella, who was appointed CEO on 4 February, told staff of the changes on Friday and the company plans to announce them publicly tomorrow.

Microsoft declined to comment on the reports.