The demand for servers has recovered with growth in demand from AWS, FB, Google and MS, says TrendForce, with Dell EMC, HPE, Inspur, Huawei, and Lenovo dominating the  market.

AWS and FB were the main drivers of demand in 2019 increasing server purchases by 10% in 2019.

Google and MS had a slight decline in orders in 2019 but are expected to increase orders by a double digit percentage in 2020.

The overall growth in demand in 2019 by the Big Four was 5-6%.

Dell and second-place HPE registered 5% and 8% declines YoY respectively. 

Dell was down because orders from U.S.-based data centers have mostly been redirected to ODM fabs, and because China-based enterprise clients favour domestic brands such as Huawei and Inspur.

 HPE’s slow adoption of Intel’s new platform led to HPE’s enterprise clients redirecting their orders to other brands and cloud service providers. 

HPE’s enterprise clients now comprise 97% of its server business, with the other 3% being hyperscale servers. 

HPE is likely to hold progressively dwindling market shares.

Inspur profits from redirected orders resulting from the trade war, while Huawei’s self-built cloud services stimulate in-house server demand.

Thanks to redirected orders resulting from the China-U.S. trade war, as well as the fact that most large-scale data centers and telecom carriers in China use domestically manufactured servers, Inspur notched shipment numbers of one million units, an 11% growth YoY.

Owing to the impact from the U.S. ban, Huawei saw weakened shipment numbers in 2Q19, since it could not obtain the necessary components for server manufacturing. 

However, as the China-U.S. trade relations gradually improved in 3Q19, client orders for Huawei servers resurged, with a 60% growth in 2H19 compared to 1H19. 

The primary drivers of growth for Huawei’s server business stem from servers for 5G infrastructure in the domestic market, and data centers for automakers and telecom operators in the overseas market.

In addition, Huawei has been gradually migrating its mobile cloud back to its self-built data centers since 3Q19.