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Gartner Q4 Server Shipment Data: HP Beats Dell Again

HP's restructuring over the past year, combined with upheaval from Dell's privatization move and from the sale of IBM's x86 server business to Lenovo, seems to have helped HP grow its fourth quarter server shipments at the expense of its rivals.

Hewlett-Packard once again bested rival Dell for the top spot in the worldwide server market, according to Gartner's fourth-quarter 2013 preliminary worldwide shipment estimates viewed by CRN.

HP's worldwide server shipments were up 9.5 percent year over year in the fourth quarter compared to a 5.4 percent drop in shipments for Dell and a 19.8 percent drop in shipments for IBM, according to Gartner preliminary worldwide shipment estimates.

Overall, worldwide server shipments for the x86 server market were up 3.8 percent, Gartner estimated.

[Related: Gartner: North America Propels Server Growth, With HP Leaving Dell Behind ]

HP's worldwide server shipment share for the fourth quarter was 28.2 percent, up 1.4 percent from the same quarter one year ago, according to Gartner preliminary estimates.

HP's server shipment increase in the fourth quarter marks the second consecutive quarter of HP shipment gains after a slump of eight consecutive quarterly shipment declines.

Dell's worldwide server shipment share for the fourth quarter was 19.8 percent, down 1.9 percent from the same quarter one year ago, according to Gartner preliminary estimates.

IBM's worldwide server shipment share for the fourth quarter was 8.3 percent, down 2.5 percent from the same quarter one year ago, according to Gartner preliminary estimates.

The HP gains come at a time of major upheavals in the server industry.

The company's primary competitor Dell in October finished a protracted fight to become a private company in a $24.9 billion leveraged buyout to refocus itself on the enterprise and move away from its traditional PC business.

IBM, meanwhile, just agreed to sell its x86 server business to Lenovo in a $2.3 billion deal that has been expected for nearly a year.

The growth of HP's server business at the expense of its two primary competitors is no surprise to Rich Baldwin, CIO and chief strategy officer at Nth Generation Computing, a San Diego-based solution provider and long-time HP partner.

"I'm seeing long-term Dell customers looking at HP servers," Baldwin said. "I'm not sure if they've lost confidence in Dell. But I am seeing several of them looking at HP for the first time."

Nth seldom competes with IBM servers, Baldwin said, so he is not sure how Lenovo's purchase of IBM's x86 server business will impact HP's server business yet.

"Lenovo in part focuses on low cost, but data centers don't care much about cost," Baldwin said. "Data centers are looking for more reliability. So this should open some doors in IBM shops. One customer of ours with an IBM infrastructure just ordered its first HP blade servers from us recently."

NEXT: HP Business Stabilized As Dell, IBM In Throes Of Change


Jeffrey Hewitt, research vice president at Stamford, Conn.-based Gartner, said that he is not ready to provide a definitive take on why the preliminary fourth-quarter server shipment numbers show a move toward HP, as he has yet to receive all the backup data.

However, Hewitt said, he can speculate.

"I can't dismiss the idea that there are cycles that everyone goes through," he said. "We seem to be at the start of a positive cycle to HP. I'd probably attribute it to the company's sales executives. HP has reorganized and changed its strategy. Last year, HP told analysts it will take a year to get its legs under itself, and then take a year to restructure, and then we will see performance."

Hewett said he could conjecture that, with HP internally stabilized, it is easier for the vendor's channel partners to talk to customers. "Partners can say, 'OK, things have settled down, now we can sell,'" he said.

It is impossible to ignore the potential impact of the pending sale of IBM's x86 server business to Lenovo, Hewitt said.

"There've been rumors for a long time," he said. "HP may have been able to take advantage of it. But I'm not sure. I'm just speculating."

Hewitt said Dell's move to go private could in theory also have had an impact on customers' buying decisions.

"So for the last quarter, you could argue that HP was the company with the least visible issues," he said.

An HP spokesperson said the company declined to comment on this story as it was based on preliminary sales numbers, while Dell and IBM declined to comment.

PUBLISHED JAN. 30, 2014

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