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

Gartner Says Worldwide Server Shipments Grew 27 Percent and Revenue Increased 14 Percent in the Second Quarter of 2010

   Worldwide server shipments grew 27.1 percent year over year in the second quarter of 2010, while revenue climbed 14.3 percent, according to Gartner, Inc.

“As in the first quarter, the second quarter again demonstrated strong year-on-year growth,” said Jeffrey Hewitt, research vice president at Gartner. “There remained some regional variations, but all geographies demonstrated improving market conditions.”

"x86-based servers grew 28.9 percent in units in the second quarter and 37.0 percent in revenues. RISC/Itanium Unix servers remained constrained, with declines of 16.5 percent in shipments and decreases of 8.8 percent in vendor revenues, compared to the same quarter last year. The 'other' CPU category, which is primarily mainframes, fell 22.8 percent in revenues for the quarter," Mr. Hewitt said.

From the regional standpoint, Eastern Europe grew the most significantly in server shipments, with a 46.9 percent increase in the second quarter of 2010, as well as the highest vendor revenue growth, at 26.2 percent for the period. All other regions had varying shipment and revenue increases.

HP led the worldwide server market based on revenue (see Table 1) — the company posted just over $3.5 billion in server vendor revenue, and accounted for 32 percent of worldwide server revenue for the second quarter of 2010. HP's share was up 3.1 percent year-on-year.

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

Table 1
Worldwide: Server Vendor Revenue Estimates, 2Q10 (U.S. Dollars)

Company	2Q10 Revenue	2Q10 Market Share (%)	2Q09 Revenue	2Q09 Market Share (%)	2Q09-2Q10 Growth (%)
HP	3,542,849,414	32.0	2,797,312,338	28.9	26.7
IBM	3,061,867,209	27.7	3,146,461,258	32.5	-2.7
Dell	1,803,984,658	16.3	1,293,178,966	13.4	39.5
Oracle	928,500,001	8.4	1,041,672,106	10.8	-10.9
Fujitsu	353,605,651	3.2	321,752,146	3.3	9.9
Other Vendors	1,364,187,334	12.3	1,073,112,404	11.1	27.1
Total	11,054,994,266	100.0	9,673,489,219	100.0	14.3

Source: Gartner (August 2010)

In server shipments, HP remained the worldwide leader in the second quarter of 2010 (see Table 2) with its market share totaling 30 percent, as shipments increased 23.3 percent over the same period last year. This growth was driven by increased 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 second quarter.

As noted above, the primary driver of the market growth for the quarter remained the x86-based server hardware platform, as it was in the first quarter — there was a marked difference between x86-based servers and non-x86 server platforms for the quarter, with the latter platforms remaining constrained overall. Blade severs had the strongest growth of any form factor, with an increase of 17.8 percent in units and 32.8 percent in vendor revenue for the first quarter.

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

Company	2Q10 Shipments	2Q10 Market Share (%)	2Q09 Shipments	2Q09 Market Share (%)	2Q09-2Q10 Growth (%)
HP	644,172	30.0	522,447	31.0	23.3
Dell	542,799	25.3	402,187	23.8	35.0
IBM	267,614	12.5	226,570	13.4	18.1
Fujitsu	60,974	2.8	48,819	2.9	24.9
Oracle	47,968	2.2	64,810	3.8	-26.0
Other Vendors	581,512	27.1	422,371	25.0	37.7
Total	2,145,039	100.0	1,687,204	100.0	27.1

Source: Gartner (August 2010)

In Europe, the Middle East and Africa (EMEA), server shipments surpassed 583,500 units in the second quarter of 2010, an increase of 18.4 percent from the same period last year (see Table 4). Server revenue totaled $3.2 billion in the second quarter of 2010, a growth of 3.7 percent from the same quarter last year (see Table 3).

“The EMEA server market’s recovery continues with typical seasonal patterns being seen with the second consecutive quarter of positive shipment and revenue growth rates,” said Adrian O’Connell, research director at Gartner. “While the market has recorded strong growth, we need to recognize that this is growth from a low base, and the market remains significantly below the pre-downturn levels of 2008. Growth is being driven by the pent-up demand for replacements but ongoing economic concerns continue to limit overall levels of investment.”

In the second quarter of 2010, of the top five vendors, only HP and Dell exhibited growth above the average market growth in shipment terms. HP held the No. 1 position, with shipments growing at 20.7 percent year-on-year. Dell, ranked No. 2, had the strongest shipment growth of the top five vendors, with a 23.3 percent year-on-year increase. Oracle was the only vendor of the top five ranking to show a decline year-on-year.

In the x86 market, total volume in EMEA grew 19.6 percent in the second quarter of 2010. “The x86 market is the engine of growth for server vendors and, although shipment levels remained close to 20 percent lower than in the second quarter of 2008, revenue is only 10 percent lower. Virtualization, although a slight inhibitor on volume levels is helping to drive richer system configurations, which is leading to stronger revenue performance,” said Mr. O’Connell.

Overall, RISC and Itanium Unix revenues declined 22.4 percent in the second quarter of 2010. IBM led the segment in the second quarter of 2010. Despite a decline of 16.5 percent, the vendor increased its share to 36.8 percent in the second quarter of 2010. Oracle declined 33.6 percent but moved to the No. 2 position. HP, ranked No. 3, exhibited a revenue decline of 13.3 percent year-on-year, although the vendor showed the best performance in the segment and subsequently grew its market share by 2.7 percentage points in the second quarter of 2010. Bull and Fujitsu maintained their fourth and fifth places, respectively.

“The first half of 2010 has seen continued challenges for vendors in the server segment of RISC and Itanium Unix. The combination of longer sales cycles for these systems, product refreshes and ongoing economic uncertainty has resulted in RISC/Itanium Unix revenue in the second quarter of 2010 being less than half that of the second quarter of 2008,” said Mr. O’Connell. “We expect this market to improve in the second half of 2010, but vendors in this segment will face an increasingly difficult challenge in minimizing migrations to Windows and Linux platforms.”

Table 3
EMEA: Server Vendor Revenue Estimates, 2Q10 (U.S. Dollars)

Company	2Q10 Revenue	2Q10 Market Share (%)	2Q09 Revenue	2Q09 Market Share (%)	2Q09-2Q10 Growth (%)
HP	1,198,773,837	37.5	987,076,991	32.0	21.4
IBM	823,837,731	25.8	933,565,694	30.3	-11.8
Dell	402,288,579	12.6	299,362,037	9.7	34.4
Oracle*	283,192,500	8.9	428,125,437	13.9	-33.9
Fujitsu	183,488,148	5.7	168,625,587	5.5	8.8
Other Vendors	307,187,275	9.6	266,743,832	8.7	15.2
Total	3,198,768,069	100.0	3,083,499,578	100.0	3.7

Source: Gartner (August 2010)

Table 4
EMEA: Server Vendor Shipments Estimates, 2Q10 (Units)

Company	2Q10 Shipments	2Q10 Market Share (%)	2Q09 Shipments	2Q09 Market Share (%)	2Q09-2Q10 Growth (%)
HP	241,898	41.5	200,421	40.6	20.7
Dell	111,328	19.1	90,273	18.3	23.3
IBM	63,701	10.9	62,359	12.6	2.2
Fujitsu	36,575	6.3	31,207	6.3	17.2
Oracle	15,473	2.7	24,053	4.9	-35.7
Other Vendors	114,558	19.6	84,743	17.2	35.2
Total	583,533	100.0	493,056	100.0	18.4

Source: Gartner (August 2010) 

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 channel.

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