Gartner

Newsroom

STAMFORD, Conn., August 29, 2012 View All Press Releases

Gartner Says the Worldwide Server Market Revenue Declined 2.9 Percent; Server Shipments Grew 1.4 Percent in the Second Quarter of 2012

Key Issues Facing the Server Market to Be Examined at Gartner Data Center Summit, November 27-28 in London and Gartner Data Center Conference, December 3-6 in Las Vegas

               In the second quarter of 2012, worldwide server shipments grew 1.4 percent over the second quarter of 2011, while revenue declined 2.9 percent year-on-year, according to Gartner, Inc.  

“The slight unit growth for the second quarter of 2012 was contrasted by a decline in revenue on a global level with geographic variations continuing to be shown based on the ongoing differences in economic conditions by region,” said Jeffrey Hewitt, research vice president at Gartner. “In terms of revenue growth, only Asia/Pacific and the United States produced growth for the quarter—all other regions declined.” 

“x86 servers continued to grow but at a moderated rate with 1.8 percent growth in units for the quarter and a 5.6 percent increase in revenue. RISC/Itanium Unix servers continued to fall globally for the period – a 14.9 percent decline in shipments and a 17.9 percent drop in vendor revenue compared to the same quarter last year. The ‘other’ CPU category, which is primarily mainframes, showed a decline of 3.0 percent,” Mr. Hewitt said. 

From the regional standpoint, the United States grew the most significantly in shipments with a 8.4 percent increase. The United States also posted the highest vendor revenue growth at 6.5 percent for the period.  

HP had the lead for the quarter in the worldwide server market based on revenue (see Table 1). The company posted worldwide server vendor revenue of $3.7 billion for a total share of 29.1 percent for the second quarter of 2012 HP’s ProLiant brand was the most significant revenue contributor to its server product lines at 85.4 percent of its total server revenue for the second quarter. 

Table 1
Worldwide: Server Vendor Revenue Estimates, 2Q12 (U.S. Dollars)

Company

2Q12

Revenue

2Q12 Market Share (%)

2Q11

Revenue

2Q11 Market Share (%)

2Q12-2Q11 Growth (%)

HP

3,747,482,751

29.1

3,947,063,788

29.8

-5.1

IBM

3,496,145,346

27.2

3,793,719,541

28.7

-7.8

Dell

1,979,115,827

15.4

1,882,518,660

14.2

5.1

Oracle

772,760,548

6.0

936,121,906

7.1

-17.5

Fujitsu

494,207,683

3.8

836,980,487

6.3

-41.0

Other Vendors

2,369,666,752

18.4

1,844,894,379

13.9

28.4

Total

12,859,378,908

100.0

13,241,298,762

100.0

-2.9

Source: Gartner (August 2012)

In server shipments, HP remained the worldwide leader in the second quarter of 2012 (see Table 2) in spite of a shipment decline of 5.6 percent from the second quarter of last year. This decline was driven primarily by drops in HP’s ProLiant and Integrity brands.

In terms of x86-based server form factors, blade servers rose 1.1 percent in shipments and 7.3 percent in revenues for the quarter. The x86-based rack-optimized form factor fell 3.1 percent in shipments and climbed 3.1 percent in revenue for the second quarter of 2012.

Table 2
Worldwide: Server Vendor Shipment Estimates, 2Q12 (Units)

Company

2Q12

Shipment

2Q12 Market Share (%)

2Q11

Shipment

2Q11 Market Share (%)

2Q12-2Q11 Growth (%)

HP

678,963

28.7

719,590

30.8

-5.6

Dell

541,693

22.9

511,507

21.9

5.9

IBM

228,138

9.6

273,718

11.7

-16.7

Fujitsu

60,602

2.6

71,848

3.1

-15.7

Lenovo

52,409

2.2

36,220

1.6

44.7

Other Vendors

804,674

34.0

720,963

30.9

11.6

Total

2,366,479

100.0

2,333,846

100.0

1.4

Source: Gartner (August 2012)

In Europe, the Middle East and Africa (EMEA), server shipments totaled more than 585,000 units in the second quarter of 2012, a decrease of 4.4 percent from the equivalent period last year (see Table 4). Server revenue totaled $3.3 billion in the second quarter of 2012, a decline of 11.6 percent from the equivalent quarter last year (see Table 3). 

“The EMEA server market continues to struggle as a result of broader economic challenges, with the second quarter of 2012 marking the third consecutive quarter of decline in shipments and the fourth consecutive quarter of revenue decline,” said Adrian O’Connell, research director at Gartner. “Each of the three key sub regions saw revenue decline: Eastern Europe by 1.3 percent, the Middle East and Africa by 0.5 percent and Western Europe by 14.7 percent. This weakness was evident in both technological and geographical segments.” 

The Other CPU segment showed the weakest result, with a 37.1 percent year-on-year decline, the market's general weakness being compounded in this segment by a cyclical low in terms of the life cycle of products. The RISC/Itanium Unix segment was also very weak, with a 25.1 percent decline, as migration away from Unix platforms continued. Despite the overall Unix weakness, IBM continued to do well, with its share of all RISC/Itanium Unix revenue increasing to nearly 53 percent. The x86 segment, although less weak than the others, also declined, with revenue down by 2.9 percent.

As in the first quarter of 2012, Dell continued to be the only top-five vendor to achieve revenue growth, as each of the other four suffered revenue declines. As such, Dell increased its revenue share by two percentage points in the second quarter of 2012. HP, in first place, performed slightly better than the market, despite suffering declines in shipments and revenue. IBM, in second place, suffered a 3.1 percentage point loss of share. “It was the vendor most affected by the weakness in the product life cycle, but it will hope to reverse this trend with the introduction of new, high-end products in future quarters,” said Mr. O’Connell.

EMEA was not alone in having a difficult time this quarter, with Japan and Latin America also declining, and even Asia/Pacific achieving only modest growth. “The real challenge for vendors operating in EMEA is that this region lacks many of the long-term growth drivers that other regions enjoy, and the region's economic malaise is limiting the short-term outlook,” said Mr. O’Connell. “New product introductions may help spur some improvement in demand as we move into the second half of the year, but the key issue for vendors remains one of execution in order to make the most of competitive opportunities.”

Table 3
EMEA: Server Vendor Revenue Estimates, 2Q12 (Millions of U.S. Dollars)

Company

2Q12

Revenue

2Q12 Market Share (%)

2Q11

Revenue

2Q11 Market Share (%)

2Q12-2Q11 Growth (%)

HP

1,212,283,159

37.2

1,344,890,506

36.5

-9.9

IBM

843,043,750

25.9

1,070,180,223

29.0

-21.2

Dell

404,799,646

12.4

383,430,650

10.4

5.6

Oracle

221,782,278

6.8

287,295,813

7.8

-22.8

Fujitsu

169,967,630

5.2

189,343,868

5.1

-10.2

Other Vendors

404,067,658

12.4

410,114,621

11.1

-1.5

Total

3,255,944,121

100.0

3,685,255,681

100.0

-11.6

Source: Gartner (August 2012)

Table 4
EMEA: Server Vendor Shipment Estimates, 2Q12 (Units)

Company

2Q12

Shipment

2Q12 Market Share (%)

2Q11

Shipment

2Q11 Market Share (%)

2Q12-2Q11 Growth (%)

HP

243,285

41.6

264,817

43.3

-8.1

Dell

112,997

19.3

106,905

17.5

5.7

IBM

56,637

9.7

68,707

11.2

-17.6

Fujitsu

31,945

5.5

39,437

6.4

-19.0

Cisco

10,300

1.8

6,885

1.1

49.6

Other Vendors

130,140

22.2

125,282

20.5

3.9

Total

585,304

100.0

612,033

100.0

-4.4

Source: Gartner (August 2012)

Additional information is available to subscribers of Gartner Dataquest’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 systems and distribution channels.

Additional analysis on the server market will be discussed at the Gartner Data Center Summit taking place November 27-28 in London and at the Gartner Data Center Conference, December 3-6 in Las Vegas. These events deliver a wealth of strategic guidance and tactical recommendations on the hottest issues, including servers, next-stage virtualization, the impact of cloud computing, mobility, storage, facilities, business continuity and disaster recovery.  

For further information on the London Summit please visit http://www.gartner.com/technology/summits/emea/data-center/. Members of the media can register to attend the event by contacting laurence.goasduff@gartner.com. For information on the Las Vegas conference, please visit www.gartner.com/us/datacenter. Members of the media can register to attend the event by contact christy.pettey@gartner.com. Information from the event will be shared on Twitter at http://twitter.com/Gartner_inc and using #GartnerDC.

Contacts
About Gartner

Gartner, Inc. (NYSE: IT) is the world's leading information technology research and advisory company. We deliver the technology-related insight necessary for our 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, we are the valuable partner to clients in over 9,000 distinct enterprises worldwide. 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, USA, and has 6,400 associates, including more than 1,480 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.

Gartner Insight
Gartner Webinars