Global server market revenue declined 6.0% year over year in 1Q20

Vendor revenue in the worldwide server market declined 6.0% year over year to $18.6 billion during the first quarter of 2020 (1Q20). Worldwide server shipments declined 0.2% year over year to just under 2.6 million units in 1Q20, IDC reveals.

1Q20 server market revenue

In terms of server class, volume server revenue was down 2.1% to $15.1 billion, while midrange server revenue declined 23.0% to just under $2.6 billion, and high-end systems declined by 9.1% to just under $1.0 billion.

“Server market performance was relatively similar to the fourth quarter, albeit a bit more muted, with bright spots including the ODM Direct vendor group realizing solid demand from its core hyperscaler and cloud provider customer set, and continued strength in the non-x86 server space,” said Sebastian Lagana, research manager, Infrastructure Platforms and Technologies at IDC.

“That said, the OEM market faced stiff headwinds due to a combination of slowing enterprise demand for x86 servers and supply chain constraints, both driven largely by macroeconomic impacts.”

Overall server market standings, by company

The number one position in the worldwide server market in 1Q20 belonged to Dell Technologies with a revenue share of 18.7%. HPE/New H3C Group took the second position at 15.5%, followed by Inspur/Inspur Power Systems at 7.1%. Lenovo and IBM were tied for the fourth position with market shares of 5.6% and 4.8%, respectively.

The ODM Direct group of vendors accounted for 25.9% of total server revenue and was up 6.1% year over year to nearly $4.83 billion. Dell Technologies led the worldwide server market in terms of unit shipments, accounting for 18.4% of all units shipped during the quarter.

Top server market findings

On a geographic basis, all regions declined in aggregate during the quarter. Japan outperformed the competitive set, down 0.5%, followed by Latin America at -2.3%, China at -2.6%, and Asia/Pacific (excluding Japan and China) at -3.0%.

The United States was down 6.1%, and Canada declined 8.3%. Europe, the Middle East and Africa (EMEA) declined by double digits, down 11.8% year over year.

Revenue generated from x86 servers decreased 9.1% in 1Q20 to $16.8 billion. Non-x86 servers grew 38.2% year over year to just under $1.8 billion.

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