Gartner: Server revenue flat in Q1

Worldwide server revenue remained flat in the first quarter of 2006, bucking several consecutive quarters of year-over-year growth, says Gartner.

Worldwide server revenue remained flat at $US12 billion in the first three months of the year, bucking several consecutive quarters of year-over-year growth, research firm Gartner said Tuesday.

While revenue remained flat, the total number of servers being sold was up, reflecting the continuing shift in spending on lower-end x86 servers. Worldwide shipments increased about 14 percent, from 1.7 million to 2 million in the quarter.

Unix server revenue fell about 5 percent and shipments declined about 1 percent. Blade server shipments, however, were up 46 percent, with IBM leading that market.

While IBM maintained its edge over Hewlett-Packard Co. as the market leader in worldwide server revenue, IBM's revenue dipped about 4 percent in the quarter. Slower sales of IBM's Unix, mainframe and minicomputer servers were offset by an 11 percent jump in x86 server revenue.

Sun Microsystems meanwhile saw its server revenue rise for the first time in nearly two years, driven by sales of its UltraSparc and Opteron-based servers. And Dell uncharacteristically stumbled a bit in the quarter, with a 2 percent dip in revenue.

Dell shipped 7 percent more servers in the quarter at 431,000 units, falling in second place behind HP, which shipped about 538,000. HP's 8 percent shipment growth was led by a 30 percent increase in shipments of Integrity servers. IBM, which fell in line behind HP and shipped about 299,000 servers in the quarter, a 19 percent boost in shipments.

Research firm IDC is expected to release its server marketshare numbers on Wednesday.