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Dell EMC, Nutanix share HCI market leadership

Dell EMC extended its lead over Nutanix in hyper-converged systems sales in the second quarter, although Nutanix crept ahead of Dell-owned VMware into first when the market is measured by HCI software.

That was the verdict from IDC in its worldwide converged systems tracker report released last night.

IDC measures the hyper-converged infrastructure (HCI) market two ways: by the brand of the systems and by the vendor whose software provides the core hyper-converged capabilities. Dell-owned technologies led both HCI market categories in the first quarter with Nutanix second in both. Nutanix, which moved to a software-centric reporting model earlier this year and is getting out of the hardware business, jumped up in software revenue but lost ground to Dell EMC in systems.

Overall, IDC said the HCI market grew 78% year-over-year to $1.5 billion in the second quarter. Dell EMC’s $419 million in revenue gave it 28.8% share. That represented 95.2% year-over-year growth, outgrowing the market. Nutanix placed second in branded revenue with $275.3 million, up 48.5% year-over-year and basically flat from its first-quarter branded revenue of $273 million. Nutanix had 18.9% of the branded revenue, down from 22.7% a year ago and 22.2% in the first quarter of 2018.

On the software side, Nutanix revenue grew 88.9% year-over-year to $498 million and 34.2% of the HCI market. It slipped past VMware, which grew 97% year-over-year to $496 million and 34.1% share. IDC considers Nutanix and VMware in a statistical tie because they are within one percent in share. VMware’s share jumped from 30.9% in the second quarter of 2017 to 34.1% a year later. But it dropped from 37.2% share in the first quarter while Nutanix increased from 35.2% to 34.2% quarter-over-quarter to catch VMware. However, Dell did receive part of Nutanix’s revenue gains because the Dell EMC  XC platform uses Nutanix software through an OEM deal,.

Dell had $79 million in HCI software, putting it in a statistical tie Cisco ($77 million) and Hewlett-Packard Enterprise ($72 million). Dell had 5.4% share, Cisco 5.3% and HPE 4.9% — all within one percent. Because Cisco and HPE sell their software on their own servers, they had the same revenue and share in systems as in HCI software. HPE had the largest year-over-year growth of any systems vendor, increasing 119.4%. However, Cisco grew more since the first quarter, jumping from $60 million to $77 million and increasing share from 4.9%. HPE dropped share quarter-over-year, slipping from 5% to 4.9% while its revenue went from $61 million to $72 million.

Hyper-convergence was the only three of the converged markets that increased year-over-year. The certified reference systems/integrated infrastructure market declined 13.9% year-over-year to $1.3 billion in revenue. Integrated platform sales slipped to $729 million for a 12.5% decline. Dell led the certified reference systems market with $640 million, with No. 2 Cisco/NetApp at $481 million. Oracle led in integrated platforms with $441 million and 60.4% share. The HCI market is also now the largest of those three converged markets for the first time.

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