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Server shipments and revenue increased in the second quarter, as Sun Microsystems and Dell gained market share at the expense of Hewlett-Packard and IBM, according to research recently released by Gartner.

Up 24.5 Percent from 2003

Worldwide shipments of servers totaled 1.6 million units, up 24.5 percent from the second quarter of 2003. Every region of the world posted a revenue increase compared to last year, Gartner says.

Low-cost servers based on Linux or Microsoft Windows continue to grow faster than their Unix counterparts, a trend that has been evident for several quarters. Linux server shipments grew 61.6 percent, while revenue from Linux servers grew 54.6 percent, Gartner says.

Servers based on Intel's Xeon processors still dominate this low-cost market, although the Advanced Micro Device Opteron processor has received a lot of attention over the past year. Both companies now ship processors based on the widely used x86 instruction set that have both 32-bit and 64-bit capabilities.

That market grew a whopping 2183 percent compared to last year's second-quarter, when only IBM was shipping an Opteron server, Gartner says. Revenue from 32-bit x86 servers grew 10 percent, while revenue from Unix servers fell 4 percent.

Numbers By Vendor

HP shipped 463,489 servers to lead all vendors in the second quarter. Its shipments grew 22.7 percent, but rival vendor Dell's shipments grew faster, and HP lost a little ground to Dell in the quarter. HP's server unit is coming off a disastrous second quarter in which revenue declined 5 percent, costing three executives their jobs.

IBM shipped 238,721 servers in the quarter, an increase of 18.5 percent, but it lost some market share. Sun shipped 90,487 servers in the quarter for an increase of 38.4 percent, the largest increase posted by any vendor.

Sun sold more of its Netra servers to the telecommunications industry in the past quarter, and also won more business for its high-end Unix servers at financial customers, Gartner says.

Fujitsu and Fujitsu Siemens Computers rounded out Gartner's list with shipments of 47,072 servers, an increase of 17.7 percent.

All server vendors combined to rake in $11.5 billion in revenue during the quarter, a 7.7 increase. IBM, HP, and Sun led the way due to the expensive Unix servers that each company still ships. Dell's product line is focused on less expensive one-way to four-way servers based on Intel's chips.