According to the International Data Corporation (IDC)Worldwide Quarterly Server Tracker, vendor revenue in the worldwide server market increased 19.9% year over year to $17.0 billion in the third quarter of 2017 (3Q17). The server market has strengthened recently after several slow quarters, in which much of the market waited for the Purley and EPYC launches.
While demand from cloud service providers has propped up overall market performance, other areas of the server market are beginning to show growth now as well. Worldwide server shipments increased 11.1% year over year to 2.67 million units in 3Q17.
Revenue in the worldwide server market increased 19.9% year over year to $17.0 billion in Q3 2017, according to IDC.
Volume server revenue increased by 19.3% to $14.2 billion, while midrange server revenue grew 26.9% to $1.4 billion. High-end systems grew 19.4% to $1.3 billion, benefiting from IBM’s z14 launch this quarter. IDC expects continued long-term secular declines in high-end system revenue, with short periods of growth related to major platform refreshes.
“Hyperscalers continued driving volume demand in the third quarter, with Amazon again leading the charge, as Google and Facebook also began ramping up their server deployments again,” said Kuba Stolarski, research director, Computing Platforms at IDC.
“While ODMs have largely been the beneficiaries of hyperscaler server demand, some OEMs have now begun to experience significant growth related to the enterprise segment. Dell Inc grew its server business by 37.9%, relying on the strong synergy between its server team and the storage team incorporated from the EMC acquisition. HPE has been pivoting away from hyperscaler business and focusing on the enterprise, hurting year-over-year comparisons in the short term, but showing strength in the enterprise. China has become a strong market for enterprise growth, as evidenced by Dell Inc growing 42.3% year over year to $433 million, and HPE/New H3C Group growing 49.6% to $421 million. In addition, IBM has demonstrated that the enterprise still has space for non-x86 systems, growing the newly refreshed system z business by 63.8% year over year to $673 million.”
Overall Server Market Standings, by Company
- HPE/New H3C Group remained first in the worldwide server market with 19.5% market share in 3Q17, as revenue decreased 1.1% year over year to $3.3 billion. HPE’s share and year-over-year growth rate includes revenues from the H3C joint venture in China that began in May of 2016; thus, the reported HPE/New H3C Group combines server revenue for both companies globally. Dell Inc maintained the second position in the worldwide server market with 18.1% of vendor revenue for the quarter and 37.9% year-over-year growth to $3.1 billion. IBM and Cisco were statistically tied* for the third market position. IBM had 6.4% share, with revenue growing 26.5% year over year to $1.1 billion. Cisco had 5.8% share, with revenue increasing 6.9% to $992 million. Lenovo was ranked fifth with 5.1% share and revenue declining 12.6% to $861 million. The ODM Direct group of vendors grew revenue by 45.3% to $4.1 billion. HPE and Dell Inc were in a statistical tie for first place in unit share, each with 18.8%. IDC initiated reporting Super Micro results in the Server Tracker with this release.