Server refresh cycle drives industry growth in Q4: IDC

The worldwide server market increased 5.2 percent year-over-year to $15.3 billion in Q4 as businesses pursue server refreshment and cloud service providers build infrastructure.

The worldwide server market increased 5.2 percent year-over-year to $15.3 billion in the fourth quarter as businesses pursue server refreshment and cloud service providers build infrastructure.

According to research firm IDC, server unit shipments also increased in Q4, rising 3.8 percent to 2.6 million units.

IDC says that much of the server market growth throughout 2015 was driven by on-premise refresh deployments as well as continued hyperscale cloud deployments.

Kuba Stolarski, research director for Servers and Emerging Technologies at IDC, says:

As the cyclical refresh of 2015 comes to an end, the market focus has begun to shift towards software-defined infrastructure and hybrid environment management, as organizations begin to transform their IT infrastructure as well as prepare for the compute demands expected over the next few years from next-gen IT domains such as IoT and cognitive analytics.

In the short term, Stolarski says 2016 will be a year of accelerated cloud infrastructure expansion with existing footprints filling out and new cloud datacenter buildouts across the globe.

Over the fourth quarter, Hewlett-Packard held the top position in the worldwide server market with a factory revenue share of 24.9 percent, despite slower demand for its x86-based ProLiant servers, particularly in Canada, Japan, and Latin America

Dell came in second with a 16.7 percent share for the quarter. IBM retained the No. 3 spot with 14.1 percent share of server revenue driven by strong growth for POWER Systems and double-digit growth for its z System mainframes in the quarter.

Lenovo and Cisco came in fourth and fifth, respectively. Here's a look at how things shaped up for 2015 as a whole:

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As for server types, IDC says density-optimized servers saw a 30.2 percent revenue growth rate for the fourth quarter. This added a full 2 percent to the total revenue growth in the market.

Demand for x86 servers improved 8.0 percent year-over-year in the quarter to $12.5 billion, while shipments climbed 4 percent to 2.6 million servers.

Revenue for non-x86 servers declined 5.4 percent annually to $2.9 billion. ARM server sales fell compared to the same time in 2014, with HPE Moonshot system deployments representing the largest single component.