Global server shipments performed weaker than DIGITIMES Research had anticipated originally, slipping almost 14% sequentially to fall below four million units. Having a lower comparison base in the same quarter a year ago and the fact that brand vendors are expected to begin volume shipments of servers with new CPU platforms, overall server shipments are expected to witness a low single-digit sequential growth in the second quarter of 2023, according to DIGITIMES Research's latest server report figures.
With mature markets continuing to be haunted by high interest rates and inflation, their impacts on consumers' and enterprises' spending have widened, affecting US-based cloud services providers' (CSPs) plans on establishing new datacenters and undermining brand vendors' server orders from enterprises.
Large public cloud services providers including Meta and Amazon were pessimistic about their cloud service business in the upcoming quarter and had significantly reduced their order pull-ins in the first quarter of 2023, resulting in a more than 8% sequential decline in US-based datacenter operators' overall shipments, the reports' figures show.
Meanwhile, enterprises in mature markets also largely cut their on-premise server deployments, leading to a double-digit downfall in the shipments by server brands Dell and HP Enterprise (HPE). With the US government's export controls on high-end ICs plus China's stagnant digital economy development, China-based datacenter operators' shipments also exhibited a sequential decline in the first quarter of 2023.
Looking into second-quarter 2023, global server shipments are expected to show a moderate rebound of nearly 4%. US-based datacenter operators' shipments will pale in comparison to the overall market performance as Meta continues to reduce its shipments. Microsoft and Google may place extra orders for AI servers to keep up with the rising popularity of ChatGPT but their shares among global server shipments will still be limited.
Server brands are expected to fare better in second-quarter 2023, to show a mid-to-high single-digit sequential growth as they step up shipments of servers with next-generation CPU platforms. China-based datacenter operators will also deliver a single-digit sequential growth due to a low comparison base in the first quarter of 2023.
