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Global server market witnesses highest ever first quarter revenue growth: IDC report

Global server market witnesses highest ever first quarter revenue growth: IDC report

Server vendors generated a revenue of $18.8 billion in the first quarter of 2018, an increase of 38.6% year of year, according to IDC. This is the highest revenue generated in the global server market in the first quarter.

The overall server market continued its growth, which is driven by strong demand from cloud service providers (CSPs), increased use of servers for software-defined infrastructure, demand for new CPUs, and increased workload deployments.

Growth in average selling prices was driven by richer configurations and increase in component costs. IDC stated that the growth in average selling prices also contributed to the overall revenue growth.

Revenue of server shipments in the first quarter grew 20.7% YoY to 2.7 million. Volume server revenue grew 40.9% to $15.9 billion, whereas the midrange server revenue increased by 34% to $1.7 billion. Further, the high-end systems revenue reached $1.2 billion, an increase of 20.1%.

IDC also reported that demand for x86 and non-x86 servers increased by 41% and $15.5% YoY in the first quarter.

“Hyperscale growth continued to drive server volume demand in the first quarter,” said Sanjay Medvitz, senior research analyst, Servers and Storage at IDC. “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.”

Dell and HPE/New H3C Group were in a statistical tie for the first rank in global server market with 19.1% and 18.6% market share, respectively. The statistical tie is declared when there is a difference of 1% or less in the share of revenues or shipments.

On the other hand, Lenovo, IBM, and Cisco were in a statistical tie for the third rank in the market, with 5.8%, 5.3%, and 5.2% market share, respectively. The revenue of IDM Direct increased by 57.1% to $4.6 billion.

Image source: IDC

As per IDC, the revenue of Dell grew the fastest (50.6% YoY) in global server market, reaching $3.6 billion. The company dominated the global server market in terms of unit shipments, which accounted for 20.6% of all unites shipped in the first quarter.

Revenue of HPE/New H3C Group reached $3.5 billion in the first quarter, increasing 22.6% YoY. The HPE and New H3C Group have been listed as one as they share a joint venture in China since 2016.

By region, Asia Pacific server market witnessed the fastest growth with 51.7% YoY revenue growth, followed by Latin America (41.1%), the U.S. (40.6%), EMEA (35%), Canada (28.3%), Japan (2.9%), and China (67.4%).

Also read: Global hyperscale data center market expected to touch $104 billion by 2024: ERC report

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