IDC: Worldwide Server Market Up 26 Percent As Dell, HPE Battle For Supremacy
The Server Wars Heat Up
The worldwide server market jumped 26.4 percent year over year to $20.7 billion during the fourth quarter of 2017, according to new data from research firm IDC.
As Dell and Hewlett Packard Enterprise continue to fight for server supremacy, the top five market leaders in the market all saw double-digit revenue growth in the quarter compared with the same quarter in 2016. "Hyper-scalers remained a central driver of volume demand in the fourth quarter with leaders such as Amazon, Facebook, and Google continuing their data center expansions and updates," said Sanjay Medvitz, senior research analyst at IDC for servers and storage, in the report.
Here are the top five leaders in the worldwide server market in the fourth quarter of 2017.
Hewlett Packard Enterprise
Market Share: 18.4%
Units Shipped: 480,000
HPE continues to lead the worldwide server market in terms of overall server revenue, capturing $3.8 billion in sales, up 10 percent year over year. The Palo Alto, Calif.-based company's market share dipped from 21.1 percent in the fourth quarter of 2016 to 18.4 percent. HPE shipped the second-most number of total server units during the quarter with 480,000. HPE's share and growth rate includes revenue from the New H3C Group joint venture in China, which began in May 2016.
Market Share: 17.5%
Units Shipped: 582,000
Round Rock, Texas-based Dell sold the most servers during the quarter with 582,000 shipped, approximately 102,000 more than HPE. Dell generated $3.6 billion in worldwide server sales during the quarter, up 40 percent year over year, compared with $2.58 billion in fourth-quarter 2016. IDC's Medvitz said Dell is continuing its "robust growth" by capitalizing on expanded opportunities from its $67 billion acquisition of EMC in 2016.
Market Share: 13%
Units Shipped: Less Than 150,000
IBM experienced another successful quarter due to its refreshed IBM z Systems business with total sales of $2.7 billion, up a whopping 50 percent year over year. The Armonk, N.Y.-based company's market share increased from 11 percent in fourth quarter 2016 to 13 percent due to the $900,000 spike in server revenue year over year. IBM did not rank in IDC's top six vendor list in regard to the number of total server units shipped, meaning IBM shipped less than 150,000 servers.
Market Share: 5.3%
Units Shipped: 182,000
Lenovo came in third place for the amount of server units shipped and fourth place for worldwide server revenue during the quarter. The China-based vendor generated $1.1 billion in sales, up 15 percent year over year. Lenovo shipped 182,000 server units, representing a 17 percent decline compared with the same quarter one year ago.
Market Share: 5.1%
Units Shipped: Less Than 150,000
The San Jose, Calif.-based networking giant captured $1.05 billion in server sales during the quarter, up 15 percent year over year. Cisco's market share slightly declined from 5.6 percent in fourth quarter 2016 to 5.1 percent in 2017. Cisco did not rank in IDC's top six vendor list regarding total server units shipped, meaning the company shipped less than 150,000 servers.
Market Share: 20.6%
Units Shipped: 653,000
The ODM Direct group of vendors grew revenue 48 percent year over year to $4.25 billion. The group accounted for 20.6 percent of the overall market share. The ODM Direct group of vendors also shipped the most server units during the quarter at 653,000.
"ODMs continue to be the primary beneficiaries from hyper-scale server demand. Some OEMs are also finding growth in this area, but the competitive dynamic of this market has also driven many OEMs such as HPE to focus on the enterprise," said IDC's Medvitz.