The x86 server market in terms of revenue declined YoY by 1.2% to reach $264.0 million in 4Q19 from $267.1 million in 4Q18. “The professional services vertical which includes public cloud providers, traditional IT/ITES companies, witnessed a drop in revenues of 24.1% to account for 36.1% of the overall market. It is important to note that this segment accounted for nearly 47.1% of all revenues in 4Q18,” said Harshal Udatewar, Market Analyst, Server, IDC India.
“The silver lining, however, was the increase in spending from verticals such as banking, telecommunications, and manufacturing that grew 33.5%, 42.9%, and 18.4% respectively. The education vertical registered the highest YoY growth of 189.9% in the x86 market during 4Q19,” he further added.
The non-x86 server market declined YoY by 13.2% to reach $35.6 million in revenue, in 4Q19. IBM tops the market with a revenue share of 74.0%, followed by Hewlett Packard Enterprise with a share of 18.2%, and Oracle with 7.8%, during 4Q19. Banking remains top vertical with 75.2% revenue share followed by manufacturing and insurance with 12.3%, and 3.6% respectively, during 4Q19.
“The market is expected to decline in 2020 due to the COVID-19 outbreak adversely affecting the supply-side leading to a shortage of components and delays in shipping. While it is impossible to predict the duration of the current situation, there is a high probability of a shift in demand towards the second half of the year,” adds Harshal.
IDC India Forecast
Due to COVID-19, the growth of the Indian economy is expected to remain moderate. The on-going lockdown is imposing severe challenges across multiple sectors such as manufacturing, BFSI, and others, due to which growth seems highly uncertain. Enterprise spending is expected to be delayed as supply-chain elements remain badly affected. However, telco and government verticals show a strong pipeline for the entire 2020. Investments from telco would be driven by projects related to OSS, BSS, IMS stack for VoLTE and 5G testbed programs towards 5G development. Also, local cloud service providers would invest in expansion projects for their infra capacity in 2020. At present, India x86 server market is expected to witness a YoY decline in values by 4.2%, during the period 2019-2020, according to the latest IDC Worldwide Quarterly Server Tracker Forecast, 4Q19, (March 2020 Release).
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