5 Companies That Had A Rough Year In 2014

Looking Back At 2014

Sooner or later, most every company in the fast-moving IT industry makes a wrong move. But then there are the vendors, either because of their own missteps, bad luck, or a little of both, find themselves in crisis mode -- or even fighting for survival.

Picking just five companies that had a rough year in 2014 was tough. We could have included the sudden departures of CEOs at Advanced Micro Devices and Symantec, Apple's glitchy iOS 8.0.1 that took some of the shine off the company's iPhone 6 glory, the reported turmoil in Oracle's sales ranks after an exodus of key managers, the hack of Apple's iCloud and subsequent leaking of nude celebrity pics, IBM paying GlobalFoundries $1.5 billion to take its money-losing chip business off its hands, Microsoft's flagging Windows 8 sales or Comcast's public relations nightmare when a "customer service call from hell" went viral. But in the end, there were five companies that had it even worse than any of them.

Here's our take on five companies that really had it rough in 2014.

Amazon's Costly Fire Phone Flop

Even giants stumble sometimes, as online retailer Amazon.com showed in 2014 with its attempt to enter the smartphone market with its Fire Phone.

With the June unveiling of the Fire Phone, Amazon was trying to reshape the smartphone market the way it has redefined the online retail and web services arenas. But while the Fire Phone offered some nifty capabilities, including the 3-D dynamic perspective technology, it soon became clear that the device's real raison d'etre was providing a better Amazon shopping experience. The fact that AT&T was the exclusive service carrier didn't help.

It quickly became clear the Fire Phone wasn't setting the market ablaze. When the company reported its third-quarter sales in October, it revealed that it had $83 million in unsold Fire Phones inventory, and the company had to take a $170 million write-down "primarily related" to unsold smartphones and supplier commitment costs. It was easily one of the biggest new-product failures of the year.

Samsung Data Center Fire Knocks Smartphones, Tablets Offline

Samsung suffered a different kind of fire disaster in 2014 -- a major conflagration in the company's data center in Gwacheon, South Korea, in April that rendered Samsung smartphones and tablets unusable for several hours. Also affected were credit card services, Samsung's SmartTV with SmartHub and other devices that relied on Samsung servers.

Accidents happen. But the incident left Samsung customers and partners scratching their heads over how a global company like Samsung (No. 14 on the Fortune 500 list with $178.6 billion in revenue) could have so many services concentrated in a single location without an automatic, immediate fail-over to another site.

In general, 2014 wasn't kind to Samsung. By late in the year, the company's share of the worldwide smartphone market had dropped to 24 percent, compared to holding one-third of the market one year earlier, and third-quarter profits were the lowest in three years. In December, a number of Samsung's high-ranking mobile executives were reported to have lost their jobs because of the setbacks.

Cisco Halts Invicta Shipments Amid Performance Problems

Cisco Systems acquired flash storage vendor Whiptail in 2013 for $415 million and integrated the technology into a new product line called UCS Invicta, a move seen as a major step by the company to expand deeper into the data center.

But in September, Cisco stopped shipping both the appliance and scale-out versions of Invicta after reports of performance and scalability problems. Customers began returning the scale-out system after running into technical glitches during deployment.

By year's end, Cisco had resumed shipping the stand-alone Invicta appliance, but the scale-out Invicta product isn't expected to resume shipping until at least early 2015. The problem was an embarrassment for a company that prides itself on the quality of its technology. And, along with the shrinking margins and layoffs seen at Cisco in 2014, it showed how difficult company transformations can be.

Juniper Networks Ousts CEO, Scrambles To Restructure

In 2013, Juniper Networks was a revolving door with top executives, as well as key channel managers, heading for the exits. So things could only get better in 2014, right?

Juniper spent the year working through a major restructuring and cost-reduction effort known as the "Integrated Operating Plan," including cutting 6 percent of its workforce in July, and then announcing more cost-cutting plans in October. Shaygan Kheradpir, who took over as CEO on Jan. 1, was leading the turnaround effort.

So it came as a shock in November when Kheradpir was suddenly ousted after the company's board reviewed his leadership, and specifically called into question his conduct "in connection with a particular negotiation with a customer."

Sudden changes in top management are rarely a good thing. Sudden changes in top management when a company is in the midst of a restructuring never are.

Sony Hit With The Hack-Of-The-Year

There were security breaches aplenty in 2014, from retailers like Home Depot and eBay, to financial services companies such as JP Morgan Chase, to health-care providers like Community Health Systems.

But in 2014 did anyone get hit worse than Sony?

Hackers calling themselves "Guardians of Peace" broke into Sony Pictures Entertainment's IT system and stole emails, employee data such as social security numbers, scripts for unproduced films like the next James Bond flick and more. The theft was bad enough, but it got worse when the stolen material, including damaging reports about executive salaries and embarrassing email exchanges dissing Hollywood celebrities, began showing up on the web -- all that before the cancellation-then-uncancellation of the release of "The Interview," and lots of criticism, including from the President of the United States.

Whether the attack was really committed by North Korea, as the U.S. government charged, or just very sophisticated hackers, the Sony security breach debacle illustrated just how ugly things can get when a company's data -- and its digital dirty laundry -- are exposed.

What's in your IT system?