STAMFORD, Conn., May 25, 2010 View All Press Releases

Gartner Says Worldwide Server Shipments Grew 23 Percent in the First Quarter of 2010

Worldwide server shipments grew 23 percent year over year in the first quarter of 2010, while revenue increased 6 percent, according to Gartner, Inc.

"We've seen a return to growth on a worldwide level, but the market has not yet returned to the historical quarterly highs that were posted in 2008, and there were some interesting variations in that growth," said Jeffrey Hewitt, research vice president at Gartner. "Emerging regions that were expected to grow, such as Asia/Pacific, forged ahead, while some mature markets, such as the U.S., produced better-than-expected results, as other countries and regions had a 'mixed bag' of results."

"The server segments varied as well. x86-based servers grew 25.3 percent in units and 32.1 percent in revenue. RISC/Itanium Unix servers were not positive, with declines of 28.5 percent in units and 26.9 percent in vendor revenue, and the 'other' CPU category, which is primarily mainframes, fell 15.1 percent in revenue for the quarter," Mr. Hewitt said.

From a regional standpoint, the U.S. grew the most significantly in shipments, with a 28.6 percent increase, while Latin America had the highest vendor revenue growth at 27.9 percent for the period. All other regions had varying shipment and revenue increases with one exception — Japan posted a revenue decline of 0.7 percent.

HP took the lead in the worldwide server market based on revenue (see Table 1). HP's server revenue reached $3.4 billion, representing 31.5 percent of the market, in the first quarter of 2010. This share was up 2.7 percentage points year over year.

IBM fell from the No. 1 spot, and it sustained a 2.1 percent revenue decline for the quarter, affected primarily by anticipated new products in both its mainframe and Unix lines.

Of the top five global vendors, Dell, Fujitsu and HP all had revenue increases for the first quarter of 2010.

Table 1
Worldwide: Server Vendor Revenue Estimates, 1Q10 (U.S. Dollars)

Company	1Q10 Revenue	1Q10 Market Share (%)	1Q09 Revenue	1Q09 Market Share (%)	1Q09-1Q10 Growth (%)
HP	3,389,508,530	31.5	2,923,706,928	28.8	15.9
IBM	3,052,091,123	28.4	3,116,339,359	30.7	-2.1
Dell	1,673,579,438	15.6	1,235,116,170	12.2	35.5
Fujitsu	645,299,697	6.0	598,529,005	5.9	7.8
Oracle	597,935,146	5.6	975,540,776	9.6	-38.7
Other Vendors	1,396,332,908	13.0	1,295,026,317	12.8	7.8
Total	10,754,746,843	100.0	10,144,258,554	100.0	6.0

Source: Gartner (May 2010)

In server shipments, HP remained the worldwide leader for the first quarter of 2010 (see Table 2) with a shipment increase of 26.6 percent. This growth was driven by increases produced from HP's ProLiant brand.

Of the top five vendors in server shipments worldwide, Dell, Fujitsu, HP, and IBM posted increases in units for the first quarter.

As noted above, the primary driver for market growth in the quarter was the x86-based server hardware platform. There was a marked difference between x86-based servers and non-x86 server platforms for the quarter with the latter posting declines. Blade severs had the strongest growth of any form factor with an increase of 23.7 percent in units and 40.7 percent in vendor revenue for the first quarter.

Table 2
Worldwide: Server Vendor Shipments Estimates, 1Q10 (Units)

Company	1Q10 Shipments	1Q10 Market Share (%)	1Q09 Shipments	1Q09 Market Share (%)	1Q09-1Q10 Growth (%)
HP	672,094	31.8	530,849	30.9	26.6
Dell	510,452	24.1	382,385	22.2	33.5
IBM	268,010	12.7	230,984	13.4	16.0
Fujitsu	77,613	3.7	59,029	3.4	31.5
Oracle	42,528	2.0	60,294	3.5	-29.5
Other Vendors	544,898	25.8	456,517	26.5	19.4
Total	2,115,595	100.0	1,720,059	100.0	23.0

Source: Gartner (May 2010)

In Europe, the Middle East and Africa (EMEA), server shipments surpassed 606,000 units in the first quarter of 2010, an increase of 19.7 percent from the same period last year (see Table 4). Server revenue totaled $3.2 billion in the first quarter of 2010, a growth of 6.6 percent from the same quarter last year (see Table 3).

“Although the EMEA server market is returning to growth in shipment and revenue terms, we need to recognize that this is growth from a low base, as the first quarter of 2009 saw a decline of 27.1 percent in shipments and a decline of 34.2 percent in revenue year over year,” said Adrian O’Connell, principal research analyst at Gartner. “Nevertheless, current market levels remain below those seen at the start of 2008, indicating that there is opportunity for stronger penetration in the EMEA server market.”

Table 3
EMEA: Server Vendor Revenue Estimates, 1Q10 (U.S. Dollars)

Company	1Q10 Revenue	1Q10 Market Share (%)	1Q09 Revenue	1Q09 Market Share (%)	1Q09-1Q10 Growth (%)
HP	1,318,339,049	40.9	1,083,593,035	35.9	21.7
IBM	763,713,876	23.7	876,236,012	29.0	-12.8
Dell Inc.	366,513,897	11.4	290,108,343	9.6	26.3
Oracle*	269,008,200	8.4	341,945,891	11.3	-21.3
Fujitsu	222,626,706	6.9	199,814,235	6.6	11.4
Other Vendors	279,628,768	8.7	229,264,481	7.6	22.0
Total	3,219,830,497	100.0	3,020,961,996	100.0	6.6

Source: Gartner (May 2010)
*Oracle includes Sun Microsystems

In the x86 market, total volume in EMEA grew 22.2 percent in the first quarter of 2010. ”We’ve seen a pronounced bifurcation between x86 and other server platforms at the start of 2010. Typically, x86 tends to be the platform that drives growth in the market, but the pent-up demand within the x86 installed base - where life cycles had been extended during the downturn - as well as shorter sales cycles in this area, have led to divergence in growth between x86 and other platforms this quarter,” said Mr. O’Connell.

In the first quarter of 2010, HP held the No. 1 position, with shipments growing at 23 percent. Dell, ranked No. 2, had the strongest shipment growth of the top five vendors, with a 30 percent year over year increase. IBM in the No. 3 position grew shipments by 10 percent in the first quarter of 2010.

Overall, RISC and Itanium Unix revenues declined 27 percent in the first quarter of 2010. IBM led the segment in the first quarter of 2010, despite a decline that matched the overall market at 27 percent. Although HP exhibited a revenue decline of 24 percent year over year, the vendor showed the best performance in the segment, and HP subsequently grew its market share by 1.5 percentage points in the first quarter of 2010. Oracle, having closed the acquisition of Sun, moved to the No. 3 position and saw its revenue decline 31 percent. Bull and Fujitsu maintained their fourth and fifth places, respectively.

“Challenges remain in this segment as the longer sales cycles that we see for these platforms are currently compounded by significant product refreshes for both IBM and HP,” said Mr. O’Connell. “The integration of Sun into Oracle is an additional factor that complicates current levels of demand. We expect demand in this segment to improve during 2010, but the vendors in this segment will be facing increasing challenges from Windows and Linux platforms.”

Table 4
EMEA: Server Vendor Shipments Estimates, 1Q10 (Units)

Company	1Q10 Shipments	1Q10 Market Share (%)	1Q09 Shipments	1Q09 Market Share (%)	1Q09-1Q10 Growth (%)
HP	265,023	43.70	218,296	43.10	21.40
Dell Inc.	113,105	18.60	86,828	17.10	30.30
IBM	67,970	11.20	63,948	12.60	6.30
Fujitsu	40,715	6.70	34,243	6.80	18.90
Oracle*	17,718	2.90	21,404	4.20	-17.20
Other Vendors	102,247	16.90	82,115	16.20	24.50
Total	606,778	100.0	506,835	100.0	19.7

Source: Gartner (May 2010)
*Oracle includes Sun Microsystems

Additional information is available to subscribers of Gartner's Servers Quarterly Statistics Worldwide program. This program provides worldwide market size and share data by vendor revenue and unit shipments. Segments include: region, vendor, vendor brand, sub-brand, CPU type, CPU group, max CPU, platform, price band, operating system and distribution channels.

 

Contacts

• Christy Pettey
• Gartner
• +1 408 468 8318
• christy.pettey@gartner.com

• Laurence Goasduff
• Gartner
• +44 1784 267195
• laurence.goasduff@gartner.com

About Gartner

Gartner, Inc. (NYSE: IT) is the world's leading information technology research and advisory company. Gartner delivers the technology-related insight necessary for its clients to make the right decisions, every day. From CIOs and senior IT leaders in corporations and government agencies, to business leaders in high-tech and telecom enterprises and professional services firms, to technology investors, Gartner is the valuable partner in over 13,000 distinct organizations. Through the resources of Gartner Research, Gartner Executive Programs, Gartner Consulting and Gartner Events, Gartner works with every client to research, analyze and interpret the business of IT within the context of their individual role. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, U.S.A., and has 5,500 associates, including 1,400 research analysts and consultants, and clients in 85 countries. For more information, visit www.gartner.com.

Comments or opinions expressed on this blog are those of the individual contributors only, and do not necessarily represent the views of Gartner, Inc. or its management. Readers may copy and redistribute blog postings on other blogs, or otherwise for private, non-commercial or journalistic purposes. This content may not be used for any other purposes in any other formats or media. The content on this blog is provided on an "as-is" basis. Gartner shall not be liable for any damages whatsoever arising out of the content or use of this blog.