The clip itself stays just as it was before. It's pretty easy to do this in iMovie and you can also do it, if you just want to correct that one video, in QuickTime Player. So you can end up with this where you have the video that's in the wrong orientation.
Phones today are a little bit better at handling this but some cameras are not. This can happen sometimes if you start recording a video on a camera and you're holding it one way and you correct yourself without stopping and starting your recording again. You can see it's a piece of vertical video but actually the video is turned on its' side.
Video Transcript: Let's say you have a piece of video that's the wrong orientation like this clip here. Check out Rotate Video In iMovie and QuickTime Player at YouTube for closed captioning and more options.