Worldwide Server Revenue Declined 1.9% in 4Q16, Shipments Down 0.6%

Worldwide Server Revenue Declined 1.9% in 4Q16, Shipments Down 0.6%

Foto: Fotolia

In the fourth quarter of 2016, worldwide server revenue declined 1.9 percent year over year, while shipments fell 0.6 percent from the fourth quarter of 2015, according to Gartner. In all of 2016, worldwide server shipments grew 0.1 percent, but server revenue declined 2.7 percent.

"There were some distinct factors that produced the final results for 2016," said Jeffrey Hewitt, research vice president at Gartner. "Hyperscale data centers (Facebook, Google) grew and, at the same time, drove some significant server replacements. Enterprises grew at a lower rate as they continued to leverage server applications through virtualization and in some cases, service providers in the cloud."

From a regional perspective, Asia/Pacific was the only region to exhibit positive growth in both shipments and revenue in the fourth quarter of 2016. All other regions declined, with Latin America experiencing the largest decline in shipments (12.2 percent, while the Middle East and Africa declined 14.7 percent in terms of revenue.

Hewlett Packard Enterprise (HPE) led the worldwide server market based on revenue in the fourth quarter of 2016. The company ended the year with $3.4 billion in revenue for the quarter with a total share of 22.9 percent worldwide. However, revenue was down 11 percent compared with the same quarter in 2015.

Of the top five global vendors, only Dell and Huawei exhibited growth for the quarter, increasing 1.8 percent and 88.4 percent, respectively.

Worldwide Server Vendor Revenue Estimates, 4Q16 (U.S. Dollars)

Company

4Q16
Revenue

4Q16 Market Share (%)

4Q15
Revenue

4Q15 Market Share (%)

4Q16-4Q15 Growth (%)

HPE

3,392,601,012

22.9

3,813,592,269

25.2

-11.0

Dell

2,578,181,854

17.4

2,533,495,993

16.7

1.8

IBM

1,732,474,861

11.7

1,974,018,084

13.0

-12.2

Huawei

1,249,813,371

7.7

610,225,437

4.0

88.4

Lenovo

946,283,185

6.4

1,136,141,494

7.5

-16.7

Others

5,039,143,533

34.0

5,064,301,087

33.5

-0.5

Total

14,838,497,815

100.0

15,131,774,365

100.0

-1.9

Source: Gartner

Dell grew 6.5 percent and moved into the No. 1 position in worldwide server shipments in the fourth quarter of 2016, with 19.1 percent of the market. HPE experienced a decline of 19.4 percent and fell to the second spot with 17.2 percent market share. Huawei experienced the strongest shipment growth in the fourth quarter of 2016, increasing 64 percent over the same period last year.

Worldwide Server Vendor Shipments Estimates, 4Q16 (Units)

Company

4Q16
Shipments

4Q16 Market Share (%)

4Q15
Shipments

4Q15 Market Share (%)

4Q16-4Q15 Growth (%)

Dell

562,029

19.1

527,736

17.9

6.5

HPE

504,407

17.2

625,543

21.2

-19.4

Huawei

245,611

8.4

149,742

5.1

64.0

Lenovo

220,296

7.5

256,571

8.7

-14.1

Inspur Electronics

141,132

4.8

140,166

4.7

0.7

Others

1,265,169

42.1

1,255,747

42.5

0.8

Total

2,938,644

100.0

2,955,505

100.0

-0.6

Source: Gartner (March 2017)

In 2016, worldwide server shipments increased 0.1 percent, while revenue declined 2.7 percent. "x86 servers continue to be the predominant platform used for large-scale data center build-outs across the globe, and the growth of integrated systems (including hyperconverged integrated systems), while still relatively small as an overall percentage of the hardware infrastructure market, also provided a boost to the x86 server space for the year," said Hewitt. "The outlook for 2017 suggests that modest growth will occur being driven primarily by service provider build-outs while the enterprise will show a slight decline in unit purchases with only slight growth in revenue."

More from category

PC Shipments Expected to Decline 9.5 Percent in 2022

PC Shipments Expected to Decline 9.5 Percent in 2022

4 Jul 2022 comment

Worldwide PC shipments are on pace to decline 9.5% in 2022, according to the latest forecast from Gartner.

5G to top 570 Million Subscriptions in Southeast Asia and Oceania in 2027

5G to top 570 Million Subscriptions in Southeast Asia and Oceania in 2027

3 Jul 2022 comment

5G subscriptions in Southeast Asia and Oceania are expected to more than double in 2022 from around 15 million at the end of 2021.

Spending on Compute and Storage Infrastructure Grew Strongly in 1Q22

Spending on Compute and Storage Infrastructure Grew Strongly in 1Q22

1 Jul 2022 comment

Spending on compute and storage infrastructure products for cloud deployments, including dedicated and shared environments, increased 17.2% year over year in the first quarter of 2022 (1Q22) to $18.3 billion, according to IDC.