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IDC - Server market hits record revenue numbers in 2Q18

By Ben Moore
Thu 6 Sep 2018
FYI, this story is more than a year old

According to the IDC 'Worldwide Quarterly Server Tracker', vendor revenue in the worldwide server market increased 43.7%, year over year to US$22.5 billion during the second quarter of 2018 (2Q18).

Worldwide server shipments increased 20.5% year over year to 2.9 million units in 2Q18.

The overall server market continues to experience historic demand with 2Q18 marking the fourth consecutive quarter of double digit revenue growth and its highest total revenue ever.

Volume server revenue increased by 42.7% to $18.4 billion, while midrange server revenue grew 63.0% to $2.5 billion. High-end systems grew 30.4% to $1.7 billion.

"The worldwide server market continues to flourish amid a market-wide enterprise refresh cycle and increasing demand from cloud service providers," says IDC servers and storage senior research analyst Sanjay Medvitz.

"Enterprises continue to invest in new infrastructure to support next-generation applications and achieve cloud-like benefits on premise. Hyperscalers also continue to update and expand their datacenter presence, benefiting ODM Direct suppliers. Server revenue growth has also been driven by increasing average selling prices (ASPs). This is due to richer configurations, DRAM prices, and new processor platforms."

Dell Inc achieved the number one position in the worldwide server market for the first time in 2Q18 with 18.8% revenue share and 52.9% growth.

HPE/New H3C Group was the second largest supplier with 16.6% share of total vendor revenue, growing 11.7%.

IBM and Lenovo were statistically tied for third position in the market with respective shares of 7.3% and 6.9%.

Inspur, Cisco, and Huawei rounded out the top five, all statistically tied with 4.8%, 4.8%, and 4.3% respective shares of vendor revenue.

(IDC declares a statistical tie in the worldwide server market when there is a difference of one percent or less in the share of revenues or shipments among two or more vendors.)

The ODM Direct group of vendors increased its collective revenue by 55.9% (year over year) to $5.5 billion.

Dell Inc. led the worldwide server market in terms of unit shipments, accounting for 19.5% of all units shipped during the quarter.

On a geographic basis, Asia/Pacific (excluding Japan) was the fastest growing region in 2Q18 with 55.0% year-over-year revenue growth.

IDC's Server Taxonomy maps the eleven price bands within the server market into three price ranges: volume servers, midrange servers and high-end servers.

The revenue data presented in this release is stated as vendor revenue for a server system. IDC presents data in vendor revenue to determine market share position.

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