Nov 26, 2007 (11:11 AM EST)
Server Shipments And Revenue Increased In Third Quarter

Read the Original Article at InformationWeek

Worldwide shipments and revenue in the computer server market rose by a healthy margin in the third quarter, as vendors benefited from increasing demand in emerging markets and the rising need for more storage, a research firm said Monday.

Shipments for the quarter increased 8.7% from the same period last year to 2.2 million units, Gartner said. Revenues climbed by 2.6% to $13.4 billion.

Growth in the market was driven both in units and revenue by sales of x86 servers, while revenue from RISC-Itanium Unix servers grew by 8%.

"Underlying market dynamics such as growth from emerging markets, coupled with an ongoing demand for increased capacity, are stronger than any inhibitors such as server virtualization," Gartner analyst Errol Rasit said in a statement. "Any implications from financial market instability were not visible in the server market in the third quarter."

Analysts have said that virtualization, which is technology that enables companies to run multiple operating systems in the same machine, could lower demand by boosting hardware consolidation in the data center.

IBM continued to lead the server market in revenue, despite a drop of 8%. IBM's server shipments fell by just under 4%, while the company's overall market share in terms of shipments dropped by just under 2%. Revenue from IBM System p and System x servers rose, while sales of System z and System i servers declined.

HP retained its top position as the lead server vendor in terms of shipments. The company shipped 20.2% more units than a year ago, and finished the quarter with a 26.5% share.

Dell continued to show steady progress after struggling for months. The company enjoyed its second quarter of shipment growth, with sales increasing 5.4%. The company's market share in terms of shipments rose 0.7%.

Sun Microsystems saw an 11.4% jump in revenue, driven by sales of its Sparc Enterprise servers. Overall shipments, however, fell by 4.5%.

Blade server shipments continued to be a driver of growth in the market, increasing by 13.8%. Blade servers accounted for 10% of the market in the quarter. HP held on to its lead in the segment, with shipments soaring 91% from a year ago.

The top five vendors in terms of revenues were IBM, with 30.1% of the market; HP, 28.1%; Dell 11.8%; Sun, 11%; and Fujitsu/FSC, 4.9%. In terms of shipments, the top five computer makers were HP, 29.3%; Dell, 21.8%; IBM, 14.4%; Sun, 3.6%; and Fujitsu/FSC, 3.4%.