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IBM, HP Lead Weak Worldwide Server Market: Gartner

With worldwide server revenue of nearly $3.2 billion and total market share of 25.6 percent, IBM was No. 1 in the worldwide server market in the second quarter of 2013, according to a report from IT research firm Gartner.

Total worldwide server shipments grew 4 percent year-on-year, while revenue declined 3.8 percent from the second quarter of 2012, according to the report, which found Hewlett-Packard in second place with revenue of just over $3 billion and a market share of 25 percent.

In the category of server form factors, x86 blade servers declined by 3 percent in shipments and 4.5 percent in revenue for the quarter. The x86 rack-optimized form factor climbed 3.9 percent in shipments and 2.4 percent in revenue for the second quarter. IBM's biggest revenue contribution was from its System z line, the report noted.

In terms of server shipments, HP remained the worldwide leader in the second quarter of 2013 with 586,857 units shipped and a market share of 24 percent—this in spite of a year-on-year shipment decline of 13.6 percent for the quarter. HP's worldwide server shipment share, however, represented a 4.8 percent decrease in share from the same quarter in 2012.

"The global server market remains in a relatively weak state overall," Jeffrey Hewitt, research vice president at Gartner, said in a statement. "The only real regional bright spot was Asia/Pacific with growth of 10 percent and 21.7 percent year on year in terms of revenue and shipments. Canada was the only other region that grew in both revenue and units (6.3 percent in revenue and 2.7 percent in units) while Latin America was close to flat for revenue but increased by 1 percent in terms of shipments. The U.S. also grew in terms of shipments by 1.9 percent year-on-year but declined in revenue by 5.1 percent."

Inspur also made it into the top five server position in the second quarter of 2013 primarily due to a significant high-performance computing (HPC) deal that it won in its native China during the quarter. In terms of vendor performances, Dell and Fujitsu remained the only two vendors from the top five to show revenue growth.

In Europe, the Middle East and Africa (EMEA), server shipments surpassed 550,000 units in the second quarter of 2013, a decrease of 5.9 percent from the same period last year. Server revenue totaled $3.1 billion in the quarter, a decline of 4.6 percent from the same quarter last year. The report noted the EMEA market lacks the hyperscale segment growth that other regions benefit from, which means that vendors in the region are more exposed to the global weakness in enterprise sales.

All three EMEA subregions saw server revenue decrease in the second quarter of 2013. In Western Europe, revenue declined 1.6 percent; in Eastern Europe, it fell 17.9 percent; and the Middle East and Africa region decreased 9 percent.

"This was the seventh consecutive quarter for shipment decline and the eighth consecutive quarter for revenue decline, showing an even more sustained period of weakness than the one we saw during the economic downturn that began in 2008," Adrian O'Connell, research director at Gartner, said in a statement.

Originally published on eWeek.
This article was originally published on August 28, 2013
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