Global Server Shipments Outpacing Economy

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 |  Includes: DELL, HPQ, IBM, JAVA
by: Ron Haruni

Worldwide server revenues, notes Digitimes - based on statistics from Gartner’s survey - totaled $13.8 billion for the second quarter of current fiscal year, as worldwide servers shipments reached 2.3 million units. Meanwhile, server shipments in 2Q’08 increased 12.2% on a year-over-year [y/y] basis with worldwide yearly server revenues climbing to 5.7%.

Jeffrey Hewitt, research vice president at Gartner, pointed out that “the most significant driver in the quarter continued to be an upswing in x86 server replacements that started in the first quarter. Coupled with Web data center build outs and growth in emerging markets, has produced solid second quarter results”. Hewitt also added that  “in spite of economic constraints in some markets like the US, on a worldwide basis, servers continued to grow in the second quarter of the year.”

Server demand remained strong across most major market segments. Customers methodically almost, expand and refresh their IT infrastructures with the main goal of optimizing and improving business productivity.

IBM’s p and z Systems posted significant increases as the company's leadership position in global server revenue in ‘08 was augmented by noteworthy 11.5% y/y revenue growth. IBM (NYSE:IBM) continued to maintain its revenue lead, with over $4.3 bln in server revenue, allowing the company to obtain 31.2% of the market share.

In terms of revenue estimates - both Dell Inc. (NASDAQ:DELL) and Hewlett-Packard (NYSE:HPQ) posted revenue increases ; 15%, 2.9% respectively. Fujitsu/Fujitsu Siemens and Sun experienced revenue declines.

Server ShipmentsClick to enlarge

HP finished the quarter with a 30.2% shipment share for the period, followed by Dell’s 24.7% growth for the quarter. However, Dell posted the biggest gain, with its shipments increasing by 24.2% y/y whereas HP, by contrast, saw only modest growth of 8.7%. The rest of global vendors, Fujitsu/Fujitsu Siemens, IBM and Sun all had shipment increases in the single digits for the period.

Server ShipmentsClick to enlarge