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HP closes the server gap

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Worldwide server shipments for the third quarter of 2007 increased 8,7% over the same quarter last year, while worldwide server revenue for the same period climbed 2,6%. 

According to Gartner, worldwide server revenue totaled $13,4-billion for the quarter, as worldwide server shipments reached just over 2,2-million units.
"This quarter the server market grew both in units and revenue, driven by x86 market volumes in the quarter, while Risc-Itanium Unix servers revenue grew at 8%," says Errol Rasit, senior analyst at Gartner. "Underlying market dynamics such as growth from emerging markets, coupled with an ongoing demand for increased capacity, are stronger than any inhibitors such as server virtualisation. Any implications from financial market instability were not visible in the server market in the third quarter."
IBM continued to lead the worldwide server market based on revenue. It had increases for the quarter in System p and System x, while it experienced declines in System z and System i, which combined to produce an overall revenue decline of 8 percent for the quarter. IBM¹s shipments fell just under 4% for the quarter, and it lost just under 2% of shipment share on a worldwide basis.
In terms of server shipments, Hewlett-Packard grew 20,2% compared to the third quarter of 2006, and retained its worldwide server shipment lead. HP finished the quarter with 26,5% shipment share for the period.
ISS continued to execute strongly and gained share in the x86 segment. The BCS division benefited from a comparison with a weak third quarter last year, although the performance this year was still good. Investments that HP has made in its account coverage and go to market activities now seem to be paying off across the server business.
Dell enjoyed its second quarter running of shipment growth and grew by 5,4%, and gained 0,7% in share which is a reflection of Dell's steadily improving results each quarter. Sun's Sparc Enterprise servers boosted revenue results in the quarter which resulted in an 11,4% growth in revenue but Sun experienced a 4,5% decline in server shipments.
Sun's focus on product margins over volumes contributed to this volume decline.
Fujitsu/FSC grew 17,4% in shipments and grew 3,4% in server revenue. Shipment growth was driven by FSC¹s x86-based Primergy business in Europe Middle East and Africa (EMEA).
The blade server segment continued to drive growth in the third quarter. Worldwide blade server shipments grew 13,8%, accounting for 10% of server shipment share.
HP retained its lead in this segment with the most significant shipment increase at 91% compared to the same quarter last year. Sun's re-entry into the server blade market in 2006 saw it climb from the number nine position to the fourth-largest blade server vendor.
In EMEA, server shipments in the third quarter of 2007 increased 12,8% over the same quarter last year, while server revenue for the same period increased 5,9%. Server revenue totaled $4,13-billion for the quarter and server shipments reached 645 000 units.
"The third quarter of 2007 was again a strong quarter for the server market in EMEA, with shipments returning to double digit growth," says Samina Malik, principal analyst at Gartner. "Overall demand for servers remained healthy with no visible impact from financial market instability during the quarter."
x86-based servers continued to perform strongly but Risc/Itanium Unix servers also saw robust revenue growth year-on-year, driven by strong performances from Sun Microsystems and HP.
HP retained the top vendor position based on revenue and exhibited a similar performance to its results worldwide.
IBM's revenue declined across most of its server lines and was impacted by transitions to new products, except for its x86-based System x line which grew revenue year-on-year.
Sun, in third position, posted strong revenue growth mostly driven by its RISC-based products.
Dell, in fourth position continued to see its server revenue increase, driven by strong revenue growth in 1- and 2-socket servers.