Worldwide Server Revenue Ramps up in Q1 of 2018

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The growth at the end of 2017 continued for the worldwide server market in the first quarter of 2018 as worldwide server revenue increased 33.4 percent and shipments grew 17.3 percent year over year, according to Gartner, Inc.

“The server market was driven by increases in spending by hyperscale as well as enterprise and midsize data centers. Enterprises and midsize businesses are in the process of investing in their on-premises and colocation infrastructure to support server replacements and growth requirements even as they continue to invest in public cloud solutions,” said Jeffrey Hewitt, research vice president at Gartner. “Additionally, when it came to server average selling prices (ASP) increases for the quarter, one driver was the fact that DRAM prices increased due to constrained supplies.”

Regional results were mixed. North America and Asia/Pacific experienced particularly strong growth double-digit growth in revenue (34 percent and 47.8 percent, respectively). In terms of shipments, North America grew 24.3 percent and Asia/Pacific grew 21.9 percent. EMEA posted strong yearly revenue growth of 32.1 percent while shipments increased 2.7 percent. Japan experienced a decline in both shipments and revenue (-5.0 percent and -7.3 percent, respectively). Latin America experienced a decline in shipments (-1.8 percent), but growth in revenue (19.2 percent).

Dell EMC experienced 51.4 growth in the worldwide server market based on revenue in the first quarter of 2018 (see Table 1). This growth helped widen the gap a bit between Dell EMC and Hewlett Packard Enterprise (HPE) as Dell EMC ended the quarter in the No. 1 spot with 21.5 percent market share, followed closely by HPE with 19.9 percent of the market. Inspur Electronics experienced the strongest growth in the first quarter of 2018 with 120.4 percent growth.

Table 1
Worldwide: Server Vendor Revenue Estimates, 1Q18 (U.S. Dollars)

Company 1Q18

Revenue

1Q18 Market Share (%) 1Q17

Revenue

1Q17 Market Share (%) 1Q18-1Q17 Growth (%)
Dell EMC 3,593,916,375 21.5 2,373,171,860 19.0 51.4
HPE 3,321,304,736 19.9 3,009,569,241 24.1 10.4
Inspur Electronics 1,188,428,802 7.1 539,259,419, 4.3 120.4
Lenovo 1,088,922,220 6.5 731,647,279 5.8 48.8
IBM 1,067,701,728 6.4 831,622,879 6.6 28.4
Others 6,432,219,303 38.5 5,023,547,428 40.2 28.0
Total 16,692,493,164 100.0 12,508,818,106 100.0 33.4

Source: Gartner (June 2018)

In server shipments, Dell EMC maintained the No. 1 position in the first quarter of 2018 with 18.2 percent market share (see Table 2). Despite a decline of 8.5 percent in server shipments, HPE secured the second spot with 13.1 percent of the market.

Table 2
Worldwide: Server Vendor Shipments Estimates, 1Q18 (Units)

Company 1Q18

Shipments

1Q18 Market Share (%) 1Q17

Shipments

1Q17 Market Share (%) 1Q18-1Q17 Growth (%)
Dell EMC 555, 792 18.2 466,800 17.9 19.1
HPE 400,958 13.1 428,169 16.8 -8.5
Inspur Electronics 200,283 6.6 139,203 5.4 43.9
Huawei 182,227 6.0 156,559 6.0 16.4
Lenovo 157,047 5.1 145,977 5.6 7.6
Others 1,555,783 51.0 1,254,892 48.2 24.0
Total 3,052,091 100.0 2,601,600 100.0 17.3

Source: Gartner (June 2018)

The x86 server market increased in revenue by 35.7 percent, and shipments were up 17.5 percent in the first quarter of 2018. The RISC/Itanium UNIX market continued to struggle with shipments down 52.8 percent, while revenue declined 46.7 percent.

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