Worldwide Server Revenue Fell In 3Q


The worldwide market for servers reached 2.3 million units during the third quarter of 2008, up 4.4 percent from the 2.2 million units sold in the same quarter of 2007.

However, worldwide server revenue fell 5.4 percent to $12.7 billion during the quarter, thanks to constrained economies and tightened credit, said Gartner, the Stamford, Conn.-based analyst firm, in its quarterly report on server sales.

HP sold over 724,000 servers worldwide during the quarter, up over 11 percent compared to a year ago, Gartner reported. HP beat Dell, which sold just over 500,000 servers, and IBM, which sold nearly 309,000 servers. Sun Microsystems and Fujitsu rounded out the top five.

Of the top five vendors, only IBM and Fujitsu saw server shipments fall.

Sponsored post

However, all five of the top server vendors saw their server revenue drop during the quarter compared to the third quarter of 2007, led by Sun's 13-plus percent drop.

IBM barely edged out HP as the overall server revenue leader, with worldwide revenue of $3.9 billion vs. HP's $3.8 billion. Dell followed with $1.5 billion, Sun with $1.2 billion, and Fujitsu with $617 million in sales, Gartner said.

The top four vendors of RISC-based and Itanium-based servers all saw their revenue fall, with Sun falling the least to give it a bigger share of the market. That market, however, is shrinking. Gartner said 86,646 RISC-based and Itanium-based servers were sold during the quarter, down 16.1 percent from last year. Revenue for those servers was $3.4 billion, down 10.8 percent over last year.

Sun led that market with 47,688 servers sold, followed by IBM, HP, and Fujitsu. However, IBM was the top vendor in terms of revenue thanks to a strong showing of its System p and System z servers, with revenue of $1.2 billion. It was followed by Sun, HP and Fujitsu.

x86-based server sales rose 5.5 percent to 2.2 million units during the quarter, Gartner said. However, lower average selling price pushed revenue down 6.6 percent to $7.1 billion.

HP's shipments grew fastest by far at 12.3 percent to reach 709,000 units sold, while Dell's shipments rose a more modest 3.3 percent to give it a total of 500,000 units sold. They were followed by IBM, Fujitsu and NEC rounding out the top five.

HP also grabbed the x86-based server revenue crown with sales of $2.6 billion, down 2.5 percent over last year. Dell held on to the No. 2 position despite a 5.2-percent drop in sales to $1.5 billion. IBM Fujitsu, and Sun rounded out the top five, with only Sun posting an increase in x86-based server revenue.

Of the top server vendors, HP was the overall volume server sales leader thanks to strong sales of x86-based servers, according to Gartner. However, its Itanium-based server sales are shrinking rapidly.

IBM is the overall server revenue leader despite falling server shipments thanks to a strong showing in its System p Unix servers and System z mainframes, Gartner said.

Sun's RISC-based server sales are falling slower than those of its competitors', giving it a larger share of that market, Gartner said in its report. However, the company is also experiencing the fastest-growing x86-based server sales of all the top vendors, although that growth is on top of a relatively small base.