2011年5月13日 星期五

Serving Up Tech Growth

MAY 13, 2011   THE WALL STREET JOURNAL


The forecast is cloudy for tech titans, like IntelHewlett-Packard and Cisco Systems, as they find growth harder to come by in their core businesses.
But a ray of sunshine is bursting through: Sales of servers to data centers are on fire as more people access more information on more devices every year.
[CISCOHERD]
Intel's key challenge is to get its chips into handsets, as well as PCs. Being power-hungry, its chips are a bad fit for mobile phones. But because they are faster calculating engines than rival chips, they are ideal for servers. Indeed, its data-center business, mostly driven by chips inside servers, was up 32% last quarter. At roughly 20% of overall sales, Intel's data-center group is a key growth driver.
H-P faces growth issues, too, weighed down by a slowing consumer PC business. Again, servers are expanding quickly, up 17% last quarter versus the company's total 4% growth rate.
Cisco, meanwhile, chased far-flung growth opportunities and lost focus. Its struggling core-networking business is so big it will continue to drag on growth. But not every new initiative has become a turkey.
Cisco jumped into servers in 2009. Because these are integrated with Cisco's networking technology, the servers provide compelling value to customers. Though still a small percentage for Cisco, sales of gear to data centers, which also includes specialized switches, are expanding fast. Last quarter, they ran at an annual rate of $1.5 billion, up from zero three years ago.
Even as investors wrestle with larger issues hanging over these companies, sales of data-center gear ultimately may serve them well.
Write to Rolfe Winkler at rolfe.winkler@wsj.com

沒有留言:

張貼留言