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Latest server numbers are in — and it’s mostly bad news. Again.

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There wasn’t much to cheer about in the latest server shipment and revenue numbers from market watchers IDC and Gartner (s it).

Click on the reports to see the whole spiel but here are my key takeaways from their crunching of second quarter server revenues and unit shipments.

  • Total worldwide server revenue flagged. The aggregate revenue across vendors was off 6.2 percent to $11.9 billion  year over year, IDC said
  • HP took it on the chin. Gartner said HP server revenue worldwide was off 17.5 percent to about $3.01 billion from $3.75 billion year over year and unit shipments off 13.6 percent to 586,857 from 678,963.
  • Cisco soared. Albeit from a small base since Cisco(s csco) is newish to the market.  Revenue rose 42.6 percent to $537 million from $376 million, IDC said.
  • Dell showed growth. Dell(s dell) revenue was up 10.3 percent for the period to $2.2 billion from $2 billion, IDC said.
  • “Other” remains the category to watch:  This group includes companies like Wistron and Quanta, which make what are often described as no-name or white-box servers. Gartner had revenue for that group up 7.9 percent and unit shipments up 14.4 percent. IDC was less impressed — its numbers showed revenue for “other” makers was off 4.2 percent.


My guess is these numbers show that compute workloads are converging in big, cloudy data centers, which often specify their own server designs and buy them from contract manufacturers. That puts the hurt on the big-brand guys. It also means that fewer companies are buying servers for their own server rooms on their usual 3-5 year replacement cycles. And that spells continuing trouble for the vendors who lived off that cycle.

4 Responses to “Latest server numbers are in — and it’s mostly bad news. Again.”

  1. brianmccallion

    With all the shiny new private Clouds in the works I’m surprised server sales declined. Maybe SaaS services are making strong inroads in enterprise. Is there any breakdown based on type of server eg. number and type of processor and or OS, memory shipped with server? I agree that Other (white boxes) is interesting to watch. Are numbers of motherboards shipped by Intel or Super Micro available?

    • Matthias Schorer

      Building a private cloud does not necessarily mean that one has to buy more servers. In contrary, with proper virtualization and resource scheduling the servers are utilized much better. A cloud adds consumption control, self service to it. And if you take it further and add monitoring, software defined networking and storage to that, then you have a software defined data center. All of those technologies are driving down use of hardware servers don’t increase it.

  2. The flow seems to be cloud > rent dedicated > colo brand servers > colo custom servers, so I expect to continue seeing that “Other” section growing and perhaps also the combined total of the top vendors growing proportionally to cloud spend growth (although nowhere near the same absolute values because it requires scale / growth to push through that cycle and cloud is always easier / the first step).

    If this is indeed the trend, the question is how do the cloud vendors direct the flow back into their own products so people don’t outgrow the cloud. VMWare certainly seems to have a good idea with their hybrid cloud service so you can transition into private cloud but still make use of their public cloud on demand. Rackspace similar with OpenStack picking up after Rackspace Cloud. What will Amazon do (if anything)?