Gartner: IBM suffers and Cisco gains following x86 divestment

While HP has remained the top server manufacturer, Cisco experienced the biggest growth according to Gartner

While HP has remained the top server manufacturer, Cisco experienced the biggest growth according to Gartner’s latest server market share data.

Despite a decline of 0.9%, HP was the worldwide server market leader based on revenue in the third quarter of 2014.

The company posted almost $3.4 billion in server revenue to account for 26.9% of worldwide server revenue. Cisco experienced the highest growth in the third quarter with 30.8%.

HP’s plans to split the consumer and enterprise businesses, which it announced in October, has not affected sales.

However, Lenovo’s acquisition of IBM’s x86 server business did impact IBM's server shipment figures.

Meanwhile, Cisco has managed to capitalise on IBM’s blade business during the divestment to Lenovo, and is addressing more IT buyers in the blade market. It is also seeing success with integrated products such as FlexPod.

Errol Rasit, research director at Gartner, said: "Based on our enquires, the split has not been an issue for enterprise. It is seen as a positive move for HP, because there is a greater focus on the enterprise."

Commenting on IBM, he added: "IBM’s x86 businesses did see some decline in the quarter. A lot of organisations were concerned by the divestment to Lenovo. Some organisations were concerned that Lenovo is a technology supplier they have not dealt with."

Specifically, Rasit said IBM’s Pure Systems was impacted by Lenovo’s acquisition of the IBM x86 business. While Pure Systems represents about 10% of IBM’s server business, this new product line, has been regarded by some IT buyers as strategic. However, Pure Systsems is now being co-developed with Lenovo. "There is some turmoil," Rasit said.

Worldwide server supplier revenue estimates for third quarter of 2014 (US Dollars)

Company

Revenue

Market Share (%)

Revenue

Market Share (%)

Growth (%)

HP

3,374,559,864

26.9

3,404,811,159

27.6

-0.9

IBM

2,322,409,499

18.5

2,821,114,540

22.8

-17.7

Dell

2,219,989,943

17.7

2,025,411,030

16.4

9.6

Cisco

783,760,000

6.2

599,300,000

4.9

30.8

Oracle

500,400,000

4.0

500,438,000

4.1

0.0

Other Vendors

3,355,453,880

26.7

2,999,925,379

24.3

11.9

Total

12,556,573,186

100.0

12,351,100,107

100.0

1.7

Source: Gartner (December 2014)

In server shipments, HP remained the worldwide leader in the third quarter of 2014 (see table above) despite a year-over-year shipment decline of 14.9% for the quarter. Of the top five suppliers in server shipments worldwide, all produced shipment increases except for HP and IBM.

In the third quarter of 2014, worldwide server shipments grew 1% year-over-year, while revenue moved upward 1.7% from the third quarter of 2013, according to Gartner.

"The third quarter of 2014 produced modest growth on a global level, highlighting positive but constrained demand," said Rasit.

There was continued decline in the sale of non-x86 servers. While there was a slight growth of 1.2% in x86 server shipments, Rasit said: “RISC/Itanium Unix server shipments declined 17.1% globally for the period and declined 8.0% in supplier revenue compared with the same quarter last year."

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