HP has been suffering from decreasing revenues from its server products over the past two fiscal years. In fact, it has experienced market share losses for 6 out of the last 7 quarters. However, the company did enjoy a short rise in market share in Dec, 2012, but the succeeding months have proven to be disappointing.
Per the IDC Worldwide Quarterly Server Tracker, December 2013, the number one position in the world in terms of server market share was previously held by IBM, but the recent increases in HP server market share has allowed HP to regain the top position with 28.1% of the total factory revenue share as of Q3 2013. On the other hand, IBM currently holds second place with 23.4% market share. While HP and IBM continue to occupy the top two rungs in the ladder, Dell has held onto their third place position with 16.2 percent of the market share. Only time will tell if HP can hold on to the top position.
HP still has a long battle ahead if it is to boost its revenues. In fact, the company is planning to let go of around 30,000 employees around the world as part of their strategy to cut costs and boost revenues. They plan to complete the process by Q4 2014. The company's CEO Meg Whitman is also currently in hot water for shareholder securities fraud.
"Worldwide server revenue declined in all major geographic regions includes Americas, EMEA, and Asia/Pacific in the third quarter. The market was impacted by a steady transition from 2nd Platform to 3rd Platform workload demand coupled with particularly weak sales of Unix servers, which served to further dampen the market," says IDC Group Vice President and General Manage of Enterprise Platforms Matt Eastwood. "2nd Platform workloads continue to represent a healthy consolidation opportunity across the market, driving solid demand for integrated systems. At the same time, 3rd Platform applications are shifting more and more server demand into cloud service provider datacenters, which is opening up new market opportunity for both ODMs and Chinese OEMs."
