IDC: Worldwide server sales on upswing in Q2

Computerworld - Although more server systems were sold worldwide in the second quarter of this year -- halting a nine-quarter decline -- it's still too early to say the market has begun to rebound, according to IDC's Worldwide Server Tracker.
That's because server factory revenues totaled $10.6 billion, just 0.2% higher than in the same quarter a year ago, Framingham, Mass.-based IDC said in a statement today.
Second-quarter growth was slightly ahead of IDC's forecast for a 1.7% decline. By comparison, in the first quarter of 2003, factory revenue declined 3.3% year over year, the market research company said.
Although revenue growth was lackluster, the number of servers shipped during the quarter rose 17.5% to more than 1.2 million units, indicating that average sale prices in the worldwide server market have continued to drop.
IBM came in at No. 1, with a 30.4% market share in factory revenue and a 10% growth in revenue, year over year. IBM's revenue from servers for the quarter was $3.2 million, up from the $2.9 million it posted in the second quarter of 2002.
Those numbers helped IBM reclaim the top spot from Hewlett-Packard Co., which was No. 1 in the first quarter of this year. HP now holds the No. 2 spot, with a 27.7% share and flat year-over-year revenue growth. HP recorded revenue of $2.9 million for the second quarter of 2003, the same as in 2002.
However, IDC said, HP retained its revenue lead in the Linux server and Windows server markets, followed by Sun Microsystems Inc., Dell Inc. and Fujitsu Siemens Computers (Holding) BV.
The x86 server market (comprising systems based on microprocessors from Intel Corp. and Advanced Micro Devices Inc.) grew more than 21% year over year in terms of unit shipments and was up 9% in terms of revenues.
IDC said the numbers show strength in the sale of servers priced at less than $25,000, reflecting continued momentum in small and midsize business segments, demand in departmental and workgroup environments at larger enterprises and slow, but steady replacement of servers purchased in 1999 and 2000 -- when the worldwide server market posted record revenues.
The Windows server market -- the largest single segment by units shipped worldwide -- grew nearly 11.5% in the second quarter in terms of revenue compared with the same quarter last year, IDC said. Unit shipments were up 21.7% from the same quarter of 2002. Windows servers accounted for $3.1 billion, or almost a third of the total server systems revenue for the quarter.
IDC saidthe Unix server market generated $4.3 billion in the second quarter, down 5.2% from the same quarter in 2002.
During the second quarter, Sun pulled ahead in the Unix server market with 33% of the market share, regaining the No. 1 spot. In the first quarter, Sun had been tied with HP for top place. HP came in second with 31.4% market share, followed by IBM with 24.6% share.
"The Unix server segment is the single largest slice of the entire worldwide server market, with more than 40% of the revenue share in 2Q03," said Lloyd Cohen, research director of Global Enterprise Server Solutions at IDC. "Unix systems, along with the associated software and services tied to these solutions, continue to drive much of the overall enterprise IT spending."

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