EMEA server space hit by 'severe weakness' at top end in Q1

Enterprise infrastructure market facing tough year, claims Gartner

The EMEA server market took a battering in Q1 as the enterprise arena displayed "severe weakness", according to data from Gartner.

Shipments in the region during Q1 fell 6.8 per cent to 583,443, while revenue plummeted 9.6 per cent to just under $3bn (£2bn). HP led the market in revenue terms, despite sales falling 12.5 per cent year on year to $1bn. IBM, in second, has shed more than four points of market share in the past 12 months and its revenue dropped 24.8 per cent annually to $617.4m, giving Big Blue a 20.9 per cent slice of the market.

Third-placed Dell was the real winner of the quarter, with sales soaring 18.9 per cent to $517.5m. The Texan giant's market share has shot up from 13.3 per cent in Q1 2012 to 17.5 per cent in this year's opening three months.

One place behind was Fujitsu, which also managed to grow revenue, albeit at a modest 1.1 per cent rate. Its $228.7m sales gave it a 7.7 per cent chunk of the market. Oracle is hanging on to its top five spot, but the company continues to post uninspiring numbers, with revenue dropping 27.2 per cent to $161.6m.

The story was similar in shipment terms, with HP heading the table despite unit volumes falling 13.2 per cent to 218,610. Dell placed second after seeing shipments grow 2.6 per cent year on year to 132,187. Third-placed IBM endured a shipment decline of 12.2 per cent and saw its market share fall south of 10 per cent. Despite its revenue increase, Fujitsu saw its shipments fall 9.1 per cent to 36,453.

Cisco shipped 14,691 servers in EMEA during the quarter, a whopping 55.6 per cent year-on-year rise and placing the networking giant in the top five with a market share of 2.5 per cent.

Gartner research director Adrian O'Connell claimed that the poor start to the year endured by the EMEA market comes hot on the heels of a lukewarm 2012.

"Following a challenging 2012, 2013 started in very much the same way," he added. "Budgets are restricted and server infrastructure spending is clearly not the highest priority for many organisations.

"The reality for server vendors is that spending levels are very low and there is severe weakness in the high-end segment. There are still areas of opportunity, but vendors need to be agile and focused on addressing them. The outlook for 2013 remains challenging."

Growth in Asia-Pacific and the US boosted the worldwide picture somewhat, but shipments were still down 0.7 per cent to 2.3 million, while revenue declined five per cent to $11.8bn. Dell and Cisco were the only vendors to display any growth during the quarter. HP, IBM and Fujitsu suffered revenue declines of 15.2, 13.9 and 15 per cent respectively.