Global server revenue grows by 19.5%: Report

Region-wise performance

Amongst regions, the Asia Pacific witnessed a volume growth of 25.6%. Japan posted the highest vendor-revenue growth of 59.5%. All of the top five worldwide server manufacturers showed growth in their turnover figures in Q2. Hewlett-Packard led global server space based on revenue posting more than $3.9 billion in sales, thus controlling 29.8% revenue-share (down by 2.2% y-o-y).

The server shipments in Middle East and Africa (EMEA) crossed 6.11 lakh units Q2-2011, a 5% y-o-y increase. The revenue aggregated $3.69 billion in Q2, representing a 15.2% hike.

“Against a backdrop of ongoing economic concerns, the server market continues to recover across the EMEA regions,” comments Adrian O’Connell, research director at Gartner. “Revenue growth outpacing shipment growth shows the strength in some high-end platforms, which, having longer sales cycles, have taken longer to return to growth mode.”

O’Connell adds: “The current growth rates look positive; but in absolute terms, the market remains below the levels that we saw prior to the downturn. Total server revenue across EMEA is only just over three quarters of the level that it was in Q2-2008. The RISC/ Itanium Unix and Other CPU systems are worse — about 50% of the pre-downturn levels. There is a need for vendors to focus on driving competitive wins to maximize the available market opportunity, particularly in non-x86 segments.”

How top vendors stack up

In Q2-2011, all of the top five vendors excluding Dell showed revenue hikes. HP was ranked as the topper with its revenue increasing by 12%. IBM followed with a 30% growth y-o-y. Dell’s growth was marred by slow uptake in public sector.

Server vendor performance by revenue: Q2-2011 (In US$)

HP won the top honors even by the global server unit sales in Q2-2011 posting a sales volume rise of 11.7% y-o-y. This growth was influenced primarily by its ProLiant servers. The vendor’s global server market share was 30.8% (increase by 1%). All top five vendors excluding Dell witnessed growth in unit sales in Q2-2011.

Technology trends

From technology point of view, x86-based servers and blades grew by 8.2% in unit sales and 29.5% in turnover. The sales of rack-optimized servers grew by 8.9% in units and 17% in revenue.

The second quarter of 2011 saw turnover increase across segments. X86 systems grew by 16.2%, the ‘Other’ CPU category, largely driven by the IBM System Z platform, grew by 36.2% and RISC/Itanium Unix systems grew by 2.1%.

Overall, RISC and Itanium Unix revenues grew by 2.1% in Q2-2011. X86 revenue grew by 16.2%. IBM led the segment with 21.9% growth. Its share grew to 43.9%. Oracle’s revenues declined by 16.1%.

“The Unix category looks squeezed between x86 and mainframes. IBM is the best-performing vendor in this consolidated segment with Oracle and HP struggling to improve business results,” O’Connell says.

Server vendor performance (Units): Q2-2011