Comparing your first and second picture, it suggests to me that your newly planted rhododendron was not getting adequate water that first season as it was beginning to become established - suffered damage.

I agree 100% with Morz8. During a drought a plant will start getting dieback and that is what you have. There can be several causes:

1) Lack of rain. Irrigation is absolutely necessary with a newly planted plant. However, only water if the plant is wilted early in the morning. It is normal for a rhododendron to wilt in the heat of the day.

2) Improper planting. You must open up the roots and make sure the root ball is wet before planting. Whether the plant was balled-and-burlaped or potted, make sure that the plant is getting wet. Rhododendron guru Harold Greer noted: "Quite often a plant will get completely dry and then no matter how much water you apply, the rootball will just keep shedding it. The top of the soil may seem wet, and the soil around the plant may even be very wet, but the actual rootball of the plant is bone dry. This is especially true for newly planted rhododendrons, and it is the major reason for failure, or at least less than great success with that new plant. It is hard to believe that a plant can be within mere inches of a sprinkler that has been running for hours and still be dry, yet it can be SO TRUE!

3) Don't over water or keep too wet; that can be fatal. It causes root rot. Good drainage is absolutely necessary to prevent root rot. Root rot is generally fatal.

Here is a link that might be useful: How to grow rhododendrons and azaleas.