Gartner Research
Gartner Research

STAMFORD, Conn. 11th December 2017 — In the third quarter of 2017, worldwide server revenue increased 16 percent year over year, while shipments grew 5.1 percent from the second quarter of 2016, according to Gartner, Inc.

“The third quarter of 2017 produced continued growth on a global level with varying regional results,” said Jeffrey Hewitt, research vice president at Gartner. “A build-out of infrastructure to support cloud and hybrid-cloud implementations was the main driver for growth in the server market for the period.”

“x86 servers increased 5.3 per cent in shipments for the year and 16.7 per cent in revenue in the third quarter of 2017. RISC/Itanium Unix servers declined globally, down 23.5 per cent in shipments and 18.3 per cent in vendor revenue compared with the same quarter last year. The ‘other’ CPU category, which is primarily mainframes, showed a decline/increase of 54.5 per cent,” Mr Hewitt said.

Hewlett Packard Enterprise (HPE) continued to lead in the worldwide server market based on revenue. Despite a decline of 3.2 per cent, the company posted $3.1 billion in revenue for a total share of 21 per cent for the third quarter of 2017 (see Table 1). Dell EMC maintained the No. 2 position with 37.9 per cent growth and 20.8 per cent market share. Inspur Electronics experienced the highest growth in the quarter with 116.6 per cent, driven by ongoing sales into China-based cloud providers, as well as global expansion efforts.

Table 1
Worldwide: Server Vendor Revenue Estimates, 3Q17 (U.S. Dollars)

Company 3Q17

Revenue

3Q17 Market Share (%) 3Q16

Revenue

3Q16 Market Share (%) 3Q17-3Q16 Growth (%)
HPE 3,144,197,027 21.3 3,247,173,253 25.5 -3.2
Dell EMC 3,070,405,586 20.8 2,227,185,685 17.5 37.9
IBM 1,130,618,441 7.7 889,723,595 7.0 27.1
Inspur Electronics 1,085,706,835 7.4 501,144,279 3.9 116.6
Cisco 996,248,000 6.8 929,440,000 7.3 7.2
Others 5,317,865,262 36.1 4,920,169,892 38.7 8.1
Total 14,745,041,151 100.0 12,714,836,704 100.0 16.0

Source: Gartner (December 2017)

In server shipments, Dell EMC maintained the No. 1 position in the third quarter of 2017 with 17.8 per cent market share (see Table 2). HPE secured the second spot with 16.4 per cent of the market. Inspur Electronics was the only vendor in the top five to experience positive growth in the quarter.

Table 2
Worldwide: Server Vendor Shipments Estimates, 3Q17 (Units)

Company 3Q17

Shipments

3Q17 Market Share (%) 3Q16

Shipments

3Q16 Market Share (%) 3Q17-3Q16 Growth (%)
Dell EMC 502,845 17.8 452,383 16.8 11.2
HPE 462,777 16.4 492,273 18.3 -6.2
Inspur Electronics 203,306 7.2 119,943 4.5 69.5
Lenovo 151,575 5.4 228,097 8.5 -33.5
Huawei 145,441 5.1 163,355 6.1 -11.0
Others 1,362,727 48.2 1,234,567 45.9 10.4
Total 2,828,617 100.0 2,691,618 100.0 5.1

Source: Gartner (November 2017)

Europe, the Middle East and Africa (EMEA) 

In the third quarter of 2017, server revenue in EMEA totaled $3.1 billion, a 17.1 per cent increase from the third quarter of 2016 (see Table 3). Server shipments totaled 495 thousand units, a growth of 2.9 per cent year over year (see Table 4).

“On the surface, the EMEA server market has some positive results at last,” said Adrian O’Connell, research director at Gartner. “However, the increased price of certain components due to supply shortages was the main driver of the revenue growth, as vendors passed increased costs on to users.”

Table 3

EMEA: Server Vendor Revenue Estimates, 3Q17 (US Dollars)

Company 3Q17

Revenue

3Q17 Market Share (%) 3Q16

Revenue

3Q16 Market Share (%) 3Q17-3Q16 Growth (%)
HPE 1,037,283,825 33.9 959,089,295 36.7 8.2
Dell EMC 671,200,329 21.9 444,823,990 17.0 50.9
Cisco 230,560,000 7.5 207,900,000 8.0 10.9
Lenovo 223,395,171 7.3 214,695,205 8.2 4.1
IBM 218,462,587 7.1 165,219,588 6.3 32.2
Others 681,559,726 22.3 622,735,528 23.8 9.4
Total 3,062,461,638 100.0 2,614,463,608 100.0 17.1

Source: Gartner (December 2017)

In revenue terms, all of the top five vendors benefited from this growth in the third quarter of 2017. HPE maintained the No. 1 position, but Dell EMC saw particularly strong share growth compared with the third quarter last year. “An expanded customer base from the EMC acquisition continues to benefit the server business in the new Dell EMC organisation,” said Mr. O’Connell.

HPE is the last of the top four vendors by revenue to still have a non-x86 server business, so it’s been affected more by the fluctuations of that segment. IBM is ranked fifth for server revenue, showing growth after a long period of decline. This indicates that the effects of the System X divestiture are now behind it.

“Despite revenues in the third quarter looking relatively positive, the low shipment growth shows the EMEA server market remains constrained,” said Mr. O’Connell. “While component shortages will ease, we’re not expecting to see an improvement in the underlying business outlook across the region for some time.”

Table 4

EMEA: Server Vendor Shipment Estimates, 3Q17 (Units)

Company 3Q17

Shipments

3Q17 Market Share (%) 3Q16

Shipments

3Q16 Market Share (%) 3Q17-3Q16 Growth (%)
HPE 170,688 34.5 171,671 35.7 -0.6
Dell EMC 107,458 21.7 97,986 20.4 9.7
Lenovo 22,576 4.6 31,198 6.5 -27.6
Fujitsu 24,365 4.9 21,946 4.6 11.0
Cisco 19,287 3.9 20,113 4.2 -4.1
Others 150,854 30.5 138,397 28.8 9.0
Total 495,228 100.0 481,311 100.0 2.9

 

Source: Gartner (December 2017)