5 Companies That Had A Rough Week

The Week Ending Nov. 21

This week's five companies that had a rough week include Microsoft's worldwide Azure service outage, Samsung's plan to cut back its smartphone lineup in an effort to reduce costs, a Microsoft partner in danger of losing its top Licensing Solution Provider status, Saleforce.com and its stock that took a hit for its fourth-quarter forecast, and some bad behavior by Uber executives.

Microsoft Wrestles With Azure Service Outage

Microsoft found itself scrambling this week to resolve a series of problems and service disruptions with its Azure public cloud service that began late Tuesday and continued well into Wednesday. Later that day, Microsoft said the outage was caused by a glitch in a performance update to its cloud storage service.

The outage was especially disastrous given that it was global, impacting customers in the U.S., Western Europe and Asia. Gartner analyst Lydia Leong tweeted that such a widespread outage "is a major red flag for enterprises considering Azure." The company has yet to explain the cause of a major Azure outage in August.

Samsung To Cut One-Third Of Smartphone Models As Profits Plunge

In an effort to turn around its plunging profitability, Samsung will cut up to one-third of its smartphone models starting next year. The plan to eliminate a number of entry- and mid-level phone models was disclosed Monday in a presentation to investors in New York by Robert Yi, the company's head of investor relations.

Last month, Samsung reported a 50 percent drop in third-quarter earnings, on the heels of a 20 percent drop in profits in the second quarter. At this time last year, Samsung held almost 33 percent of the worldwide smartphone market, according to industry research firm IDC, but that has plummeted to less than 24 percent despite smartphone market growth of 25 percent.

CompuCom Could Lose Microsoft Top-Partner Status

National systems integrator CompuCom could lose its status as a Microsoft Licensing Solution Provider (LSP) because it's not meeting revenue targets or investing enough in technical certifications, sources told CRN.

The $2.2 billion CompuCom is one of between 13 and 16 LSPs in the U.S., partners that Microsoft allows to sell Enterprise Agreement volume licensing contracts. While sources told CRN that CompuCom might be under the gun because the Dallas-based company isn't adding enough value in areas such as cloud and mobility, Microsoft is reportedly also considering reducing the number of LSP partners to as few as six by the middle of 2015.

Uber Executive Proposes Investigating Critical Journalists

Car service application developer Uber Technologies was in damage control mode this week, thanks to comments made by Uber executive Emil Michael, who suggested spending $1 million to hire researchers to dig into the personal lives of journalists who criticize the company. CEO Travis Kalanick has apologized for the comments. Uber is investigating the incident and Yahoo Finance neatly summarized the company's woes with the headline "Uber: Growing Pains Or Lack Of Grown-Ups?"

Uber has been dealing with multiple PR fiascos recently. Last week, a New York woman was harassed with calls and text messages from an Uber driver after she canceled an Uber order. Another woman resorted to crowdsourcing to raise the $362 she was charged for an Uber ride under the company's holiday and rush-hour surge-pricing policies. This week, there were growing questions about how Uber treats customer data.

Salesforce Stock Takes A Hit Over 4Q Forecast

File this one under "heightened expectations." This week, Salesforce.com reported year-over-year revenue growth of 30 percent to almost $1.4 billion -- numbers most businesses would kill for. But Salesforce shares were down 4.5 percent in after-hours trading Wednesday because the company's sales forecast for its current (fourth) quarter will be closer to $1.44 billion rather than the $1.45 billion Wall Street was expecting.

Salesforce remains unprofitable as it invests in growth and acquisitions. Analysts don't expect the cloud application company to report its first fully profitable year until 2018. But that heightens expectations for rapid growth, and this week we saw how, in such a situation, even the smallest sign of a slowdown has repercussions.