Morey addressed the decision in a statement on Thursday night:
"After returning from Orlando and reflecting on what has been an amazing 14 years with the Houston Rockets, and after discussing my thoughts with family and close friends, I've decided I’ll be stepping away from the Rockets organization effective November 1st. It has been the most gratifying experience of my professional life to lead the Rockets. I am very confident that the future—for the Rockets, and for our incredible fans—is in great hands, and that the Rockets will continue to perform at the highest level."
Rockets governor Tilman Fertitta thanked Morey for his contributions to the organization:
"On behalf of the entire Rockets organization, I would like to thank Daryl Morey for his hard work and dedication over the past 14 seasons. Daryl is a brilliant innovator who helped the Rockets become a perennial contender. I have truly enjoyed working with Daryl and couldn't have asked for a better general manager to have at the start of my ownership. I wish him and his family all the best."
According to ESPN's Adrian Wojnarowski, Morey and Fertitta reached an exit agreement with the former "increasingly determined to explore what else might interest him professionally." Morey also plans on spending more time with his children and will remain with Houston in an advisory role as the team searches for its next head coach.
Jonathan Feigen of the Houston Chronicle reported this was "100 percent" Morey's decision.
Houston will promote executive vice president of basketball operations Rafael Stone to general manager, per Wojnarowski.
Houston fell in five games to the Los Angeles Lakers in the Western Conference Semifinals this year. It was the second straight year the Rockets failed to reach the Western Conference Finals or NBA Finals, and head coach Mike D'Antoni—whose contract ran out after the season—is also no longer with the team.
The 48-year-old Morey has served as the team's general manager since the 2007-08 season, leading the organization to 10 postseason appearances and eight straight playoff berths. The Rockets have won 50 or more games seven times in Morey's tenure and have reached the Western Conference Finals twice, though they have yet to win a title.
This decision also comes a year after Morey's since-deleted tweet in support of protesters in Hong Kong, in which he wrote: "Fight for Freedom. Stand with Hong Kong." That caused an instant backlash from China, as the Chinese Basketball Association decried the comments and the Rockets lost business relationships in the country.
As for the Rockets, the organization has been popular in China since they selected Hall of Fame center Yao Ming with the first overall pick in the 2002 NBA draft, making Morey's comments all the more controversial in the country.
"The Rockets are China's NBA team," Du Gong, a reporter for the Chinese internet portal Tencent—one of the businesses that cut ties with the Rockets—told Fran Blinebury of NBA.com in 2016. "It began with Yao Ming. But even in the years after he is no longer playing, this is the team that more Chinese fans know and follow. They are loyal to the team that made the first of their countryman the No. 1 choice."
On Oct. 7, The Athletic's Sam Amick and Joe Vardon reported that the "Rockets did not consider firing Morey, nor did the NBA consider disciplining Morey for his original tweet."
"I think as a values-based organization that I want to make it clear ... that Daryl Morey is supported in terms of his ability to exercise his freedom of expression," NBA Commissioner Adam Silver said at the time.
"There is no doubt, the economic impact is already clear," he added of the backlash to Morey's tweet. "There have already been fairly dramatic consequences from that tweet, and I have read some of the media suggesting that we are not supporting Daryl Morey, but in fact we have."
The Rockets supported Morey, but his time with the organization has come to an end with his decision to step down.