5 Companies That Had A Rough Week

The Week Ending May 8

This week's roundup of companies that had a rough week includes a security vulnerability warning from Lenovo, an investigation into accounting practices at Toshiba, lower-than-expected demand for Windows Server 2003 replacement services at a leading solution provider, the price tag for Nvidia's exit from the mobile chip business, and Steve Wozniak's skepticism about the Apple Watch.

Lenovo Discloses Second Significant Vulnerability This Year

Months after being criticized for the Superfish browser add-on, Lenovo this week disclosed a vulnerability on some of its products that could allow hackers to replace legitimate apps with malicious ones. The affected systems include the ThinkPad, ThinkCentre, ThinkStation and Lenovo V/B/K/E Series.

Lenovo issued an advisory Wednesday detailing three vulnerabilities in an update within Lenovo System Update, including failure to check downloaded executables from the Internet before running them and a flaw that could allow a hacker to sub in malicious apps. A patch has been issued.

In February, Lenovo came under fire for authorizing the installation of the Superfish browser software on its consumer PCs. Superfish injects ads into Websites on browsers and, according to critics, can be used to eavesdrop.

Toshiba Cancels Dividend, Withdraws Earnings Outlook Amid Accounting Probe

Toshiba is expanding an investigation into accounting irregularities that began last month, the company said Friday, and as a result is canceling a scheduled dividend payment and withdrawing its earnings outlook, according to a Reuters story.

Because of the investigation, Toshiba said, it would not be able to announce financial results for fiscal 2015, ended in March, until June or later.

Reuters said the investigation has uncovered cases in which building costs for infrastructure projects were under-reported and losses from construction were inadequately booked.

Earnings Dip At Insight As Windows Server 2003 Refresh Lags

Solution providers counting on a sales boost from customers migrating off Windows Server 2003 might not want to bank on that just yet.

This week Insight Enterprises reported a slight drop in Q1 earnings and revenue that fell a bit short of financial analysts' expectations. CEO Ken Lamneck said he expected stronger demand for services to upgrade Windows Server 2003 given the pending end of Microsoft support. But that demand wasn't what the company had counted on.

Lamneck said many businesses might not move off Windows Server 2003 until a major security breach occurs.

Apple Co-Founder Wozniak Skeptical About Apple Watch

Apple didn't exactly get a ringing (ticking?) endorsement this week for its new Apple Watch from co-founder Steve Wozniak.

Wozniak, who attended an Internet-of-Things event in Boston this week, said he hasn't been a big fan of smart watches in general and admitted he hasn't tried the Apple Watch. While he said he plans to buy one and see how it works, he expressed skepticism that it would be more convenient that using an iPhone to access messages and email.

Wozniak said he's been first in line when Apple debuted other products, including the iPhone and iPad. But he just didn't have the same sense of urgency for the Apple Watch.

Nvidia Expects $100 Million Charge As It Exits Wireless Modem Chip Business

Chip manufacturer Nvidia this week said it would wind down its Icera LTE modem unit, part of the company's move out of the business of making chips for mobile devices. The company said it expects to take a restructuring charge of $100 million to $150 million against earnings this year because of the move.

While Nvidia continues to enjoy success in developing graphics processing chips, the company's efforts to expand into new areas such as manufacturing chips for mobile devices have been a bust.