In the fourth quarter of 2016, worldwide server revenue declined 1.9% year-over- year, while shipments fell 0.6% from the fourth quarter of 2015, according to Gartner, Inc. (www.gartner.com). In all of 2016, worldwide server shipments grew 0.1 percent, but server revenue declined 2.7%, notes the research group.

"There were some distinct factors that produced the final results for 2016," says Jeffrey Hewitt, research vice president at Gartner. "Hyperscale data centers (e.g., Facebook, Google) grew and, at the same time, drove some significant server replacements. Enterprises grew at a lower rate as they continued to leverage server applications through virtualization and in some cases, service providers in the cloud.”

Hewlett Packard Enterprise (HPE) led the worldwide server market based on revenue in the fourth quarter of 2016. The company ended the year with $3.4 billion in revenue for the fourth quarter of 2016 for a total share of 22.9% worldwide. However, revenue was down 11% compared with the same quarter in 2015.

Of the top five global vendors, only Dell and Huawei exhibited growth for the quarter, increasing 1.8 percent and 88.4 percent, respectively. Dell grew 6.5% and moved into the No. 1 position in worldwide server shipments in the fourth quarter of 2016, with 19.1% of the market.

HPE experienced a decline of 19.4% and fell to the second spot with 17.2% market share. Huawei experienced the strongest shipment growth in the fourth quarter of 2016, increasing 64% over the same period last year.

x86 server demand increased in revenue by 1.1%; however, shipments declined 0.3% in the fourth quarter of 2016. In 2016, worldwide server shipments increased 0.1%, while revenue declined 2.7%.