IBM surprised many on Thursday announcing that CEO Ginni Rometty would step down as CEO, to be replaced in April by cloud chief Arvind Krishna.

Why it matters: Though some had expected IBM might make a change in the next year, the timing jolted many inside and outside of the company, with Rometty having just recently held court in Davos, unveiling a new call for targeted AI regulation.

Driving the news:

• Krishna, a 30-year IBM veteran, was a key driver the acquisition of Red Hat and has been leading the company's effort to grow its position in cloud computing, where Microsoft, Amazon and Google have been the leaders.
• Rometty, who has spent 40 years at IBM and eight years as CEO, will serve as executive chairman until the year's end, and then retire.
• The company also named Red Hat CEO James Whitehurst to be IBM's president, effective in April.

Flashback: During Rometty's tenure, IBM forged close ties with the Trump administration, acquired 65 companies (most notably its $34 billion purchase of Red Hat) and pushed into quantum computing and other areas.

• However, the company saw revenue shrink over her tenure, including for five straight quarters, before reporting 1% growth for the fourth quarter of 2019.
• IBM has also cut as many as 100,000 workers in recent years, Bloomberg reported, even as it has staffed up in other areas.

Between the lines: IBM was late to the cloud game and now focuses on helping companies coordinate their technical needs between their own servers and public clouds like those from Microsoft, Google and Amazon.

In an interview last year, Krishna told me that IBM could use the Red Hat deal to make that approach work. Customers, he said, are looking for the flexibility to host their own software one day, move that same setup to a cloud provider the next and still have the flexibility to change cloud providers down the road.

• "We strongly believe there is a massive opportunity to create a common platform that goes across these clouds," Krishna said.

But even in that area, IBM faces competition from Dell and Google, among others, per Gartner's Craig Lowery. "If anyone can do it, they have the potential and I think this step shows that they are serious," Lowery said.

Reactions: Rometty shared the news with about 300 of IBM's top executives from around the world at the company's senior leadership meeting, and received a standing ovation.

Investors seemed fine with the moves, sending shares up more than 4% in after-hours trading.

What's next: IBM needs to make the Red Hat deal pay off, Lowery said. "The market has been very clear in telling IBM their cloud strategy is not up to snuff."

Google brought a slew of D.C. policy experts to its Mountain View, California, headquarters this week for a summit, people familiar with the event told Axios' Margaret Harding McGill. The move comes as the tech company seeks to deal with increased scrutiny from Washington.

Why it matters: Google is in the midst of reconfiguring its approach to a newly aggressive Washington, and it cut its lobbying budget last year. With this event, the company aims to make sure D.C. influencers from across the ideological spectrum understand its products better.

Details: Roughly 50 people from groups ranging from Public Knowledge to Americans for Prosperity are attending an event that Google, according to an invite obtained by Axios, is billing as the first in a "series of quarterly policy and product summits."

• Google will "present an interactive program designed to dig into timely and relevant subject matter and to strengthen connections between our valued partners and our broader teams," according to the invite.
• That includes briefings and discussions on products such as search, advertising and artificial intelligence, according to a person familiar with the event.
• Speakers from Google's D.C. office include Karan Bhatia, vice president of global policy and government relations, and Mark Isakowitz, vice president of government affairsand public policy.

Other attendees include former FCC commissioner Mignon Clyburn, Americans for Tax Reform's Katie McAuliffe, the Competitive Enterprise Institute's Patrick Hedger, and Debra Berlyn, executive director of the Project to Get Older Adults onLine (Project GOAL), according to a list of participants.

Between the lines: It's common for companies such as Google to host gatherings of policy experts. Outside voices can be critical in shaping federal policymakers' views, so in an era of growing mistrust of Silicon Valley, companies like Google may find indirect influence more effective than direct lobbying.

What they're saying: "We've long engaged with organizations from across the political spectrum that focus on technology issues," a Google spokesperson said. "We're always glad to have the opportunity to host people at our headquarters to explain our products and the work we do to innovate."

Facebook said Thursday it will take further steps to ensure its social network is home to accurate information about the fast-spreading coronavirus.

Driving the news: Facebook announced late Thursday it is removing more types of false information about the disease and adding modules with accurate information from the WHO within its news feed.

• Facebook had already been offering ad credits to the WHO and Philippines Department of Health to help promote accurate data, while also returning dedicated information modules when users search for terms related to the outbreak.

Why it matters: The move comes after the World Health Organization declared a global health emergency and amid the continued spread of coronavirus misinformation through social media.

Meanwhile: Google and Twitter are also taking steps to promote verified information.

Go deeper: What's happening with the coronavirus

Amazon's market capitalization rose above $1 trillion in after-hours trading on Thursday after it posted earnings and revenue that exceeded analysts' expectations, as Axios' Scott Rosenberg and Sara Fischer report.

Why it matters: Wall Street has wondered whether Amazon's huge investments in one-day delivery and cloud services would depress its financial performance. This quarter, at least, gave investors a positive surprise.

By the numbers: Amazon reported per-share earnings of $6.47, well ahead of the FactSet consensus estimate of $4.04. Revenue was $87.44 billion, compared with expectations of around $86 billion.

In addition, Amazon announced it now has 150 million Amazon Prime subscribers.

• That's shy of Netflix's 167 million global paid subscribers.
• But unlike Netflix, Amazon didn't offer a geographical breakdown of those subscribers. (The majority of Netflix subscribers are international.)
• That number is up from "over 100 million" almost two years ago.

On the advertising front, Amazon reported that its "other" category, which is mostly made up of advertising revenue, was up 41% year-over-year to over $4.7 billion.

• Amazon's ad business, while growing rapidly, is notably different from Google's in that it's mostly marketers paying to promote their products in search.
• Amazon also announced that its Fire TV hardware product, which competes with Roku and Apple TV, now has more than 40 million active users worldwide.

On Tap

• The Super Bowl is on Sunday. For those unfamiliar, it's like the Super Bowl of football games, and also home to a lot of tech-themed commercials.

Trading Places

• Dropbox has recruited Olivia Nottebohm as its new chief operating officer. Nottebohm comes from Google Cloud, where she was a VP, overseeing sales to small and midsize businesses.
• Airbnb hired Disney veteran Catherine Powell to serve as VP of experiences. Joe Zadeh, who has been leading that effort, will now oversee the company's efforts to serve its many stakeholders.
• Brad Fitzpatrick, who just left Google, is joining Tailscale.
• Phillip Berenbroick, formerly policy director at Public Knowledge, is now counsel with the House Judiciary antitrust subcommittee.

ICYMI

• Iowans are concerned about the role Facebook will play in next week's caucuses and other presidential primaries, as well as in the general election. (CNET)
• At SoftBank's urging, Uber and DoorDash held merger talks, although they were unsuccessful. (Financial Times)
• The cybersecurity sector saw record venture capital investment in 2019. (Axios)
• According to the OECD, 137 countries have agreed to work toward uniform global digital tax rules. (Financial Times)
• The FBI is reportedly investigating NSO Group, whose spyware tools are thought to have been used in high-profile phone hacks including Jeff Bezos'. (Reuters)

Did you know about the bunnies that used to burrow beneath the Berlin Wall? Me neither, but now we all do.