is making a comeback in server sales after a challenging
2004 campaign and a high-profile CEO change.
For the first quarter 2005, HP inched closer to IBM
worldwide server systems revenue of 27.6 percent compared to Big Blue’s 28.3
percent share, according to researcher IDC.
The Palo, Alto, Calif. systems vendor, which grew server sales 8.8 percent
from Q1 2004 to the present, also maintained its No. 1 position with 30.4
percent server shipments worldwide.
Other research bears this out. Earlier this week, Gartner said HP blew out
Big Blue’s 1.1. percent revenue growth, notching 13.1 percent growth and
28.1 percent of the overall server market sales.
HP is also expected to announce next week that it is moving its high-end
NonStop server line completely to Itanium, reaffirming its commitment to the
beleaguered processor architecture.
tied for third in
revenue with a 10.8 percent and 9.9 percent share, respectively. Continuing
its long rise up the server charts, Dell enjoyed the largest year-to-year
growth of 16.6 percent. Dell also notched No. 2 in shipments with 24.5
percent, an expansion of 17.4 percent compared to Q1 2004.
Overall, server sales grew 5.3 percent year-to-year to $12.1 billion, the
eighth quarter in a row of revenue growth. Low-cost volume server sales grew
the most, at 15.6 percent, with mid-range systems sales growing a modest 6.1
IDC attributed the growth to the virtualization features that the systems vendors
have loaded into their entry-level and mid-level systems. Once relegated to
mainframes and other high-end machines, virtualization is wending its way into volume servers.
This is perhaps to the detriment of the high-end business servers, which
dipped 13.9 percent year over year.
The numbers for the first quarter of 2005 also introduced an anomaly of sorts. For the first
time in IDC’s rankings, Unix server revenue and Windows server revenue were
statistically tied in the quarter at $4.2 billion, showcasing increased IT
spending in Windows servers.
IDC analyst Jean Bozman said Unix servers have traditionally gained more
revenue from sales in the midrange enterprise and high-end enterprise server
segments because they scale well.
“The equal level of spending in both segments this quarter showed that
Windows servers are gaining traction in the enterprise server space with a
combination of deeper investment and richer configurations,” Bozman said.
Servers fitted with the open source Linux operating system continue to
blossom, posting year-over-year sales growth of 35.2 percent and unit
shipment growth of 31.1 percent on revenue of $1.2 billion.
Meanwhile, x86 server sales growth was strong, albeit moderated. IDC said
factory revenue grew 13.2 percent to nearly $5.8 billion worldwide, while
unit shipments grew 14.2 percent to nearly 1.5 million servers worldwide.
Notably, HP was able to sell enough servers based on AMD’s Opteron chip to
become the only top systems vendor in the 4-way x86 server space to grow
Slimmer blade servers also performed well in the first quarter of 2005, as shipments increased
by 68.2 percent and factory revenue gained 106 percent. Led by IBM with 39.2
percent of the market, blade servers accounted for $409 million in the first quarter.
Gartner and IDC’s estimates were similar, despite being obtained via
different metrics. Earlier this week, Gartner said the overall market grew
4.1 percent to $12.3 billion worldwide compared to the first quarter of 2004.