HP loses as European server market slows

Server kingpin sees EMEA revenue drop by 19 per cent in Q1

HP emerged as the main loser in an EMEA server market that shrank by double digits in revenue terms in the first quarter.

According to figures from market watcher Gartner, the server market suffered its third consecutive quarter of revenue decline in the three months to 31 March. Revenue came in at $3.2bn (£2.1bn), down 10.5 per cent year on year, with western Europe down 13.1 per cent.

Unit shipments fell for a second consecutive quarter, by 2.2 per cent to 626,085.

Even the x86 segment – which has driven the market for so long – fell back by 2.1 per cent in revenue terms, with the RISC/Itanium Unix and Other CPU segments tumbling 25.7 and 29.4 per cent respectively.

Adrian O'Connell, research director at Gartner, said: "The Unix segment in particular is struggling and although we are seeing results vary by vendor, the overall segment appears to be rapidly approaching a tipping point, which could undermine the long-term viability of the segment."

Market leader HP was the worst hit as its revenue fell 19 per cent to $1.18bn. Gartner said the vendor had been particularly affected by Oracle's withdrawal of support for Itanium.

Dell was the only one of the top five vendors to achieve revenue growth, enabling it to increase its market share from 11.1 to 13.1 per cent year on year.

Second-placed IBM's revenue tumbled 15.3 per cent, while Oracle and Fujitsu's takings fell by 12.2 per cent and 7.6 per cent respectively.

"We are going through a period of significant disruption in which a combination of platform migrations, business challenges and technology changes is sending ripples through the industry," said O'Connell.

"Even the x86 segment that has driven the market for so long will start to face challenges as new servers based on extreme-low-energy processors threaten to undermine the strength of its ecosystem."