Global server sales revenues fell 5% Y/Y in Q1, says Gartner. That's a reversal from Q4's 5% growth, and evidence of both weak IT spending and a shift towards cheaper hardware. EMEA was down more than the rest of the world, apart from Japan.
Top vendor IBM, whose hardware unit had an tough Q1, saw its revenue share fall 250 bps Y/Y to 25.5%. #2 H-P, hurt by crumbling Itanium server demand, saw its share fall 280 bps to 25%, and #5 Oracle, hit hard by plunging UNIX server sales, saw a 130 bps drop to 4.6%. But #3 Dell's share rose 310 bps to 18%, and Cisco cracked the unit share top-5 at 2.3%. In EMEA, Dell rose to 17.5% of the market. IBM EMEA's revenue share fell to 20.9% from 25.1%.
Sales outside the top-5 vendors grew to make up 22% of sales, up 370 bps. Sales of x86 servers (mostly Intel-based) grew 1.8%, though this was down from Q4's 6.6% rise.
In EMEA server shipments were just over 580,000 units in the first quarter of 2013, a decrease of 6.8% from the same period last year. Server revenue totaled $2.96 billion, a decline of 9.6% from the first quarter last year as prices fell.
"Following a challenging 2012, 2013 started in very much the same way," said Adrian O'Connell, research director at Gartner. "Budgets are restricted and server infrastructure spending is clearly not the highest priority for many organizations."
Each of the three EMEA subregions suffered a contraction in server revenue in the first quarter of 2013: in Western Europe revenue declined by 9.6%, in Eastern Europe it fell by 9.4%, and in the Middle East and Africa it decreased by 13.4%.
In the first quarter of 2013, x86 server revenue increased by a modest 1.8 percent. RISC/Itanium Unix server revenue declined by 54.8%, due to migrations to alternative platforms by users seeking lower-cost alternatives and more flexibility.
Dell and Fujitsu were the only server vendors to exhibit revenue growth in EMEA. The market environment remains difficult for all vendors, but those most exposed to the enterprise customer segment face the biggest challenges.
"It's easy to identify when trends are occurring in the market, but working out when you should enter that market is paramount."
Dieter Lott, VP Business Development EMEA at Avnet Technology Solutions EMEA