The world’s largest computer maker, Hewlett-Packard Company (HPQ), recently announced that it will continue to work on the Itanium-based Integrity server platforms with the company’s indigenous HP-UX operating system, which has a background of more than 10 years.
The company is trying to develop its server business, offering innovative solutions to retain its leading position in this segment. Moreover, with this new age Itanium server, the company will continue to support customers running existing versions of Oracle (ORCL) software on Itanium-based Integrity servers, in both the platforms in the same timeframe.
This adds value to the company’s existing portfolio and strengthens its market presence.
A renowned market research firm IDC, claims that HP accounted for around 39.0% of the total x86 server revenue for 2010. The company’s revenue from the x 86 servers grew 34.0% year over year. Moreover, the company has remained at the number one position in the x86 server market for 59 straight quarters.
Hewlett-Packard also grabbed market share from the EPIC/RISC Blade server market, which improved 20.8% on a year-over-year basis in the fourth quarter of 2010. Leading companies have chosen HP over any other server vendor, as the technology major follows a stringent quality control procedure for all its products.
Many industry experts believe that moving through 2011, there would be major development in the SQL Server universe. Some are also of the opinion that the SQL Server market is expected to face fierce competition from Microsoft in the cloud, as many companies are moving from traditional servers, to widespread adoption of virtualization technology and the growing popularity of self-service business intelligence (BI) tools. So demand for traditional servers is expected to be rationalized to a certain extent.
This apart, HP is focusing on cloud computing as well. The company expects the cloud computing market to be $143.0 billion by calendar year 2013. The company intends to play a pivotal role in the expansion of private and public cloud computing networks throughout the world. Moreover, HP also intends to increase its market presence in the business analytics software segment.
We remain positive on HP’s performance going forward, given its leadership position in the PC and Server segments. But we are not very confident about substantial improvement in the company’s consumer business in the near future, due to significantly higher competition.
The company has a short-term Hold recommendation (Zacks #3 Rank).
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