"Satya sold approximately 840,000 shares of his holdings of Microsoft stock for personal financial planning and diversification reasons," a Microsoft spokesman said in a written statement, the Wall Street Journal reported.
The transaction yielded more than $285 million for Nadella, according to the news outlet.
The decision to sell the shares may have been prompted by Washington state move to impose a 7 percent tax for long-term capital gains beginning at the start of 2022 for income exceeding $250,000 a year, according to analysts.
Microsoft is currently valued at a $2.53 trillion market capitalization, up about 780% since Nadella was appointed CEO. The company was founded in 1975 in the US by Bill Gates and Paul Allen, producing computer software, electronics, personal computers, and providing related services.