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International Data Corporation’s (IDC) EMEA Server Tracker shows that in the third quarter of 2016 the EMEA server market reported a year-on-year decline in vendor revenues of 14,3% to $2,6-billion and a YoY decrease of 7,2% in units shipped to just over 500 000.

Looking at the EMEA market in euros, reported revenues in 3Q16 declined 14,7% YoY. Currency instability may continue to play a role in pound- and euro-denominated revenues, as the long-term impact of Brexit on Western European IT markets remains to be seen.

The EMEA non-x86 market continued to decline compared with previous quarters, with vendor revenue down 23,4% YoY, at just over $314-million.

When viewing the market by product, the biggest decline was seen in standard density optimised server units and revenues, which decreased 32% and 45,8% respectively.

Blade servers, with the highest overall revenue and shipment numbers (61 000), also declined significantly by 22,2% and 23,5% respectively. Custom density optimised servers were the only model with positive growth in the quarter, with shipments increasing 52,2% and revenues by 15,3%.

“Strong growth was seen by Others in 3Q16, driven mainly by increased traction in the IoT space,” says Eckhardt Fischer, research analyst: European infrastructure at IDC.

HPE again maintained its position as market leader in Western Europe, with 36,5% market share, while Lenovo displaced IBM as the third-largest vendor in the region at a market share of 7,9%. The relatively poor performance in 3Q16 was led by significant revenue declines of 10% to 20% for major vendors.

“Large revenue declines across vendors in Western Europe were driven by a number of factors, rather than a single underlying reason. Political and economic uncertainty, tepid demand typical in 3Q, and fewer large server deals were some of the primary catalysts for downward pressure on regional revenues,” says Michael Ceroici, research analyst: European infrastructure at IDC.

Ireland and the UK were the two worst performers over the quarter, partially due to the delay in major infrastructure shipments and partly due to ongoing uncertainly over the impact of Brexit on financial and security regulations. A big winner was Greece, which was one of the only countries in the region to see substantial positive revenue growth (at 135% YoY), due to a large investment by a systems integrator.

“Central and Eastern Europe, the Middle East, and Africa [CEMA] server revenue continued its downward path, declining 17,2% to $540,58-million in 3Q16,” says Jiri Helebrand, research manager at IDC CEMA. “Shrinking demand for non-x86 architecture, coupled with the ongoing shift toward cloud services, put pressure on HW sales.

“The Central and Eastern Europe [CEE] subregion declined 21,5% YoY with revenue of $239,25-million due to lack of demand in the public sector in Poland, Czech Republic, and Russia. Growing interest from SMBs in public cloud services also had a negative impact on hardware sales in CEE as the largest public cloud providers’ infrastructure is located outside CEE.

“The Middle East and Africa (MEA) subregion declined 13,5% YoY to $301,33-million as IT projects continue to be scaled back or are on hold due to challenging economic conditions impacted by low oil prices and unfavourable exchange rates. Nigeria and East African countries, however, recorded double-digit growth driven by public sector investments in infrastructure projects and the fulfilment of previously halted deals.”