Gartner: HP's third quarter storage numbers drop

By Robert Mullins, IDG News Service, 12/05/06

Major storage vendors reported double-digit sales growth in the third quarter with the exception of HP, which suffered a double-digit decline.

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HP sales of external controller-based disk storage slumped by 11.9% from the year ago quarter to $475 million in the three months that ended Sept. 30, according to a report out Tuesday from research firm Gartner.

HP trailed market share leader EMC, whose 17.4% revenue gain to $954 million earned it a 25.5% market share. IBM ranked second with a 14.8% share, as its revenue grew 17.9% to $553.1 million. While HP held onto third place, its market share slipped to 12.7% from 15.5% in the third quarter of 2005.

Dell ranked fourth with a 10.8% share and Hitachi Data Systems fifth with a 7.3% share.

The storage vendor with the strongest growth was sixth-ranked Network Appliance, which saw sales jump 20.4% to $272 million for a 7.3% share.

Sun trailed the pack with a 5.3% share. In the third quarter, Sun completed its first year of StorageTek ownership, which it acquired for $4.1 billion.

Overall, the global market for disk storage grew 7.4% from the year ago quarter to $3.74 billion.

HP aside, Gartner says the major vendors strengthened their place in the market in the third quarter through some consolidation and enhanced marketing efforts.

HP CEO Mark Hurd alluded to weak storage sales in a quarterly financial conference call with investment analysts Nov. 16. HP's storage sales grew only 1% in its fiscal fourth quarter, which ended Oct. 31, the weakest of any of its product lines.

"Our growth profile of our storage business is negatively impacted by our mix toward the declining tape market," Hurd told analysts. "We are not happy with our storage growth in the fourth quarter and we need to do a better job of driving top line momentum in the coming year."

The IDG News Service is a Network World affiliate.

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