Billy Donovan won't return as Oklahoma City Thunder coach next season

Billy Donovan and the Thunder have "mutually agreed to part ways," the franchise announced Tuesday night. 

Donovan's contract expired at the end of the season as the Thunder fell to the Rockets in the first round of the playoffs. 

"We had planned to sit down at the end of the season and discuss the best way to move forward for both of us," Thunder general manager Sam Presti said in a statement. "After those discussions, it became apparent that we couldn’t provide him the information on the future direction of the team over the next several seasons to give him the level of clarity that he understandably desires at this stage of his career. 

"Therefore, we close this chapter and reflect fondly on all that he has given to the team, organization and community. Billy will always have a place in the Thunder family." 

Donovan's departure, and Presti's statement, signals a new era for the organization. After surpassing expectations this season, a rebuild might be underway next season. 

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Veterans like Chris Paul, Dennis Schroder and Steven Adams remain on the roster, but their futures with the organization are uncertain. Danilo Gallinari is set to enter free agency. 

Donovan went 243-157 in five seasons as the Thunder's coach. He was named head coach April 30, 2015 after 19 years at Florida.

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"Coaching the Oklahoma City Thunder the past five seasons has been a great honor, and I thank Mr. Bennett, Sam and the entire organization for the opportunity,” Donovan said in a statement. "I have a great respect and admiration for the players I coached in Oklahoma, and I also want to thank the coaches I worked with, who gave unbelievable time and expertise to our common goal.

"Lastly, I want to thank the Oklahoma City community for being so welcoming to my family during our time here. This place will always be special to us. I will always hold this organization in the highest regard and wish the Thunder and their fans the success they deserve."