Server sales record "worst ever" quarter

 

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By Stuart Turton

Posted on 2 Sep 2009 at 09:56

IDC has reported the worst ever quarter for server sales, after shipments plunged a staggering 30.4%.

It's the fourth consecutive quarter of revenue decline in the struggling server market, and while manufacturers are praying for the market to bottom out, shipments have continued to plummet, accelerating from the 26.5% fall experienced in the first quarter.

The fall dragged revenues down to $9.8 billion, the lowest since IDC began tracking server shipments in 1995.

The analysts pinned responsibility for these pitiful results on the economic gloom, but also the increasing prevalence of virtualisation technology which is drawing enterprise spend away from hardware. Despite this, the firm suggested there may be better days ahead for hardware companies.

"Over the past four quarters, the worldwide server market has experienced significant revenue deceleration in all geographic regions as the economic recession has deepened," says Matt Eastwood, group vice president of Enterprise Platforms at IDC.

In the weeks and months ahead, IDC believes that IT customers around the globe will begin to focus on the future once again

"It is clear that the worldwide server installed base is aging rapidly. In the weeks and months ahead, IDC believes that IT customers around the globe will begin to focus on the future once again, making strategic compute platform decisions for the next business cycle, and driving more predictable server demand as market conditions stabilise in the second half of 2009."

The plunge in sales had little effect on the standings of the major server manufacturers with IBM holding its number one spot in the worldwide server market with a 34.5% share.

HP was comfortable in its second spot with a 28.5% share for the quarter, while Dell and Sun held the number three and four market positions with 12.4% and 10% of revenues respectively.