02 Nov 2020 -

Server shipments may drop further 12% in 4Q20 but Amazon bucks trend, says Digitimes

After a 6% loss in Q3, global server shipments are estimated to drop a further 12% during Q4 as a result of the coronavirus pandemic disrupting the buying pattern, reports DigiTimes.

“Most datacenter operators and brand vendors have decelerated their order pull-ins since the start of the second half due to high inventory levels already built in the second quarter. The lingering pandemic has hit hard Europe and North America, with datacenter operators delaying their server installation and testing there. Local enterprises are also cutting their procurement of servers,” says the DigiTimes research

Amazon will be the only top-4 cloud computing service provider to see sequential shipment growth in the fourth quarter as the company’s server orders for the first half were milder than those of its fellow companies. Amazon has strong demand for servers due to expansion plans.

Intel, which was originally set to unveil its next-generation Whitley server platform at the end of 2020, is unlikely to begin volume production for the new CPUs until after first-quarter 2021. Server clients have decelerated order pull-in to wait for the transition to be completed with the replacement trend unlikely to take place until the first half of 2021.

Says DigoTimes, “Facebook and Google both increased server shipments in the third quarter due to demand from their online multimedia and cloud computing AI platforms. However, the two datacenter operators will slow down the pace of orders pending Intel’s transiting to the new CPU platform. The two still have inventory needed to be digested. As a result, each of them will see a sequential shipment decline of around 10% in the fourth quarter.”

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