News

Research Shows Growth in x86-Based Server Demand

• By David Ramel
• 03/16/2016

Amid a growing overall market, demand for x86-based servers increased year over year in the fourth quarter of 2015, while non-x86 server revenue actually declined, according to new research from IDC.

Overall factory revenue in the global server market increased 5.2 percent to $15.3 billion in the fourth quarter of 2015, IDC said, marking a continuing trend.

"This was the seventh consecutive quarter of year-over-year revenue growth, as server market demand remained positive due to an on-going enterprise refresh cycle coupled with continued infrastructure buildout by cloud service providers," IDC said in a statement last week about the latest numbers in its Worldwide Quarterly Server Tracker.

The demand for x86-based servers saw 8 percent revenue growth and a 4 percent increase in shipments. However, non-x86 server revenue decreased by 5.4 percent.

In the x86 camp, HP Enterprise (HPE) led the market flat revenue growth resulting in a 29 percent revenue share, followed by Dell (5.3 percent growth, 20.5 market share).

Among the non-x86 players, IBM rode revenue growth of 8.9 percent to garner 75.8 percent of the revenue. ARM-based servers sales declined, with HPE Moonshot the leading vendor in that segment.

"Datacenter buildout continues, and the main beneficiary this quarter is the density-optimized segment of the market, where growth easily outpaced the overall server market," said IDC analyst Jorge Vela in a statement. "Density-optimized servers achieved a 30.2 percent revenue growth rate this quarter, contributing a full 2 percentage points to the overall 5.2 percent revenue growth in the market. The story is similar if one looks at unit shipments; density-optimized server shipments increased 22.4 percent compared to overall market growth of 3.8 percent. The extra 65,000 units of this form factor shipped compared to a year ago added almost $330 million to the overall market. Unsurprisingly, HPE and Dell contributed more than half of this growth, extending their lead in this form factor. ODM manufacturers, a constant source of compute for cloud service cloud, accounted for much of the rest of the growth."