Vendor revenue on servers grows

hp_serversBeancounters at IDC have added up some numbers and divided them by their shoe size and concluded that vendor revenue in the worldwide server market increased by 38.6 percent.

IDC said this meant that everything grew to $18.8 billion during the first quarter of 2018, generating more revenue than any other first quarter on record.

Global server shipments also increased 20.7 percent to 2.7 million units.

The rise was driven by “a market-wide enterprise refresh cycle, strong demand from cloud service providers, increased use of servers as the core building blocks for software-defined infrastructure, broad demand for newer CPUs such as Intel’s Purely platform, and growing deployments of next-generation workloads”.

IDC also noted that average selling prices (ASPs) increased during the quarter, thanks to richer configurations and increased component costs, which would have also contributed to revenue growth.

High-end systems grew 20.1 percent to $1.2 billion,  midrange server revenue grew 34 percent to $1.billion and volume server revenue increased by 40.9 percent to $15.9 billion.

IDC’s senior research analyst Sanjay Medvitz said that hyperscale growth continued to drive server volume demand in the first quarter.

“While various OEMs are finding success in this space, ODMs remain the primary beneficiary from the quickly growing hyperscale server demand, now accounting for roughly a quarter of overall server market revenue and shipments.”

As for market share, Dell  and HPE/New H3C Group were the top two vendors, with 19.1 and 18.6 percent of the market respectively in 1Q18.

Dell also led as the fastest growing server vendor among the top five companies, growing revenue 50.6 percent year on year to $3.6 billion based on a strong performance in all major geographic regions.