5 Companies That Had A Rough Week
The Week Ending Jan. 15
Topping this week's roundup of companies that had a rough week is Cisco, which shocked customers and partners with a significant goof concerning default passwords sent with the company's servers.
Also making the list were cloud storage company Panzura, whose CEO was ousted by the company's board; FireEye, which lost its channel chief to Dell; Verizon, which had a data center outage that had repercussions felt by its customer, JetBlue; and Intel, whose stock was hammered after the company reported its fourth-quarter financials.
Not everyone in the IT industry was having a rough go of it this week. For a rundown of companies that made smart decisions, executed savvy strategic moves -- or just had good luck -- check out this week's Five Companies That Came To Win roundup.
Cisco Partners Stunned By Password Snafu
Cisco admitted this week that it shipped servers with the wrong default password to customers for more than seven weeks. Between Nov. 17, 2015, and Jan. 6, the networking giant shipped a number of C-Series servers, including UCS systems, with a default password unknown to its customers -- a mistake that prevented administrators from logging into their servers.
While the default password was supposed to be "password," Cisco changed it to "Cisco1234" sometime in November without telling its customers. On Monday, Cisco sent a notification alerting customers to the problem. But it has yet to say how and why the error occurred.
Cisco partners said the embarrassing goof was uncharacteristic of Cisco and praised the company's testing and quality assurance programs.
Cloud Storage Startup Panzura Ousts CEO
It was a bad week for Panzura CEO Randy Chou, who was ousted this week by the cloud storage technology company he co-founded in 2008. Question is, what does it mean for the company?
Panzura's board brought in John Peters, a Silicon Valley-based management consultant with a track record of turning around and selling struggling startups, to lead the company on an interim basis.
Peters, in an interview with CRN, said the board dismissed Chou because it concluded that new leadership was needed to take the company to the next level. He said the company isn't considering a sale at this point and is focused on scaling up for long-term growth.
FireEye Loses Global Channel Chief To Dell
Dell Security this week hired away FireEye Global Channel Chief Steve Pataky to lead its worldwide security sales business. Pataky had been FireEye's channel chief since August 2013.
Pataky's exit is another hiccup for FireEye, which in recent months has been the subject of buyout rumors and has seen the value of its stock price plummet.
FireEye's loss is, of course, Dell's gain. Pataky, however, is replacing Marvin Blough, who left Dell to pursue an opportunity outside of the company.
Verizon Data Center Outage Delays JetBlue Flights
It was a bad week for Verizon, for its customer JetBlue, and for JetBlue customers.
A power outage at a Verizon data center hit JetBlue Airways' operations Thursday, delaying flights and sending travelers scrambling to rebook. JetBlue said it experienced network issues because the data center outage impacted the airline's customer support systems including jetblue.com, mobile applications, check-in and airport counter and gate systems, and others.
Neither JetBlue nor Verizon provided details about the outage, including the location of the data center. Verizon is reportedly in the process of selling off its data center business.
Intel Shares Hammered After Warning On Gross Margins
Intel reported fourth-quarter sales gains in its data center and Internet of Things product lines Thursday. But investors focused on the company's struggling PC processor business and a forecast of lower gross margins, dropping the price of the chipmaker's share price as much as 9.5 percent Friday morning, to below $30 per share, before it recovered a bit.
For the fourth quarter of 2015, Intel reported a 1 percent revenue gain, to $14.9 billion. But the company's gross margin was down 1.1 percentage points, to 64.3 percent, and the company said that could drop to as low as 58 percent in the current quarter. Revenue from the company's client computing group, which makes chips for the struggling PC industry, was down 1 percent.