Gartner: Worldwide server revenues grow slightly in Q2

Worldwide server revenue grew slightly in Q2 from a year earlier, according to Gartner.

Worldwide server revenue was up nearly 5 per cent year over year for the second quarter of 2005, with IBM continuing to lead the overall pack of vendors in revenue, according to new research from Gartner.

Worldwide revenue for servers was $US12.15 billion compared with $US11.6 billion in last year's second quarter, according to Gartner. IBM had sales of $US3.7 billion for the period, followed by HP with $US3.53 billion, Sun Microsystems with $US1.45 billion and Dell with $US1.34 billion.

Though IBM led in revenue figures, HP led in units, with 493,910 server shipments for the quarter, followed by Dell with 423,195 shipments and IBM with 277,232 shipments. This reflected the typical market trend, because HP sold more low-end or "volume" servers than IBM Gartner analyst, Michael McLaughlin, said.

The rest of the results for the quarter also were in line with usual market dynamics, he said.

The revenue lead in the Unix server market shifted hands, with Sun overtaking HP for the lead, but the shift was due to a typical seasonality factor, not any major gain in Unix server revenue for Sun, McLaughlin said.

The second calendar quarter coincides with the last quarter of Sun's fiscal year, so a final sales push at Sun's typically drives its revenue higher in that period.

More important to note about Sun's results in the quarter is that the company's revenue from RISC-based servers was down 9 per cent year-over-year, from $US1.48 billion in 2004 to $US1.34 billion in 2005, McLaughlin said.

Because the bulk of Sun's servers, save its handful of AMD Opteron-based products, were built on its Sparc proprietary RISC architecture, it was a bad sign when they declined in [this category] because there was no way to make it up in other products, he said.

HP's revenue in this market was down 8 per cent year over year, but the company was not as dependent on its RISC-based servers as Sun, McLaughlin said.

On the other hand, IBM, made notable year-over-year gains in RISC servers, with $US1.65 billion in revenue for the quarter, a 21 per cent gain over the same period last year, when the vendor took in $US1.3 billion.

He said IBM's Power5 chip architecture was probably the main factor for its growth in this segment, and IBM's growth in turn was driving gains in the overall RISC-based server market.

IBM also continued to lead in the blade server market, which experienced the most year-over-year growth of all the server market segments for the quarter. In the 2004 second quarter, total revenue in the blade server market was about $US281 million, which grew to almost $US482 million in 2005's second quarter, a gain of 33 per cent, according to Gartner.

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