Eye on Oracle

May 26 2011   1:50PM GMT

IDC: Oracle’s server revenue catapults

Mark Fontecchio Mark Fontecchio Profile: Mark Fontecchio

According to IDC numbers released this week, Oracle’s server revenue increased 13.6% in the first quarter of this year compared to the first quarter last year.

Oracle’s increase outpaced the industry as a whole, which grew 12.1%.

Oracle had $773 million in server revenue in the first quarter compared to $681 million in the first quarter of 2010. Its increase, combined with Fujitsu’s 15.6% decline in server revenue year-over-year, kept Oracle in fourth place behind HP, IBM and Dell. That’s not to say that Oracle is even close to catching up to the big 3 however; its revenue was less than half of Dell in 3rd place, and about one-fifth as much as 1st place HP.

In its release, IDC said Oracle’s increase was in part due to “improved demand for SPARC-based servers.” In fact, overall Unix servers performed well for the first time in almost three years, growing 12.5% compared to last year. IDC analysts attributed that to customers who had delayed buying more expensive Unix servers during the economic downturn in 2009 and 2010, but who were ready to upgrade in the first quarter.

That’s the good news. The more sobering news is that Oracle’s server revenue is the lowest it has been since the first quarter of last year. Its server revenue was higher in the second, third and fourth quarters of last year. Oftentimes this is the case – overall vendor server revenue tends to be lower in the first quarter. But it doesn’t look too great that Oracle has been out there pushing its server hardware, particularly the Exadata and Exalogic, but haven’t been able to increase revenues since the first quarter of last year. Maybe we’ll see an uptick next quarter.

Does Oracle really care about this? I’m not too sure. Many customers and analyst think that Oracle is more concerned with profit than with overall revenue – that’s why they’re pushing large-margin products like Exadata. Whether Exadata and Exalogic are selling as well as Oracle claims is another question.

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