With so many organizations moving to the cloud, it might come as a surprise to know that data center hardware sales are booming.

But it’s true if we’re to believe International Data Corp.’s numbers in its latest Worldwide Quarterly Converged Systems Tracker, released Tuesday. Revenue jumped 9 percent from a year ago, to $3.6 billion, in the fourth quarter of 2017. Full-year sales were also up 9 percent, hitting $12.5 billion in 2017.

IDC breaks up the converged systems market into three segments, including certified reference systems and integrated infrastructure, which are systems that come prepackaged with servers, disk storage, networking gear and the necessary management software. The second segment relates to integrated platforms, which are those sold with extra, integrated software and customized system engineering that’s optimized to run things such as databases, application development software and testing tools. Last are the modern hyperconverged systems that bundle storage and compute functionality within a single virtualized system.

“The number of organizations deploying converged systems continued to expand through 2017,” said Eric Sheppard, IDC’s research vice president of Enterprise Servers and Storage. “This drove the total market value past $12.5 billion for the year. Not all market segments increased during the year, but those that did grow provided considerable benefits related to the core infrastructure challenges facing today’s data centers.”

Older systems in decline

IDC said the certified reference systems and integrated infrastructure segment was the largest of the three, pulling in $1.7 billion in fourth quarter revenue. That’s a slight 3.4 percent decline from the year before, but the segment still represents 47 percent of the overall converged systems market.

Dell EMC, a subsidiary of Dell Technologies Inc., was ranked the largest supplier in this segment. The company pulled in $735 million in sales to control 43 percent of the market. The alliance between Cisco Systems Inc. and NetApp Inc. came in second, with Hewlett-Packard Enterprise Co. landing in third place.

Integrated platforms saw the largest declines, however. Sales in this segment dipped by 18 percent in the fourth quarter to just $675.5 million. Oracle Corp. was the top supplier in the quarter with revenue of $360.5 million, giving it a 53 percent market share.

Hyperconverged systems drive rapid growth

The real growth was in hyperconverged systems. Revenue there grew by 69 percent compared to the previous quarter, hitting $1.25 billion to give it a 34 percent share of the market.

IDC ranks suppliers in this segment in two ways: by the brand of the hyperconverged system, and by the company that provides the software that delivers the hyperconverged capabilities.

Dell EMC also ranked on top of the branded systems, with its $346.8 million revenue, giving it a 28 percent share of the market. Nutanix came in second with $243 million and 19.5 percent, followed by HPE and Cisco, which tied for third place.

However, it’s VMware Inc. that led in HCI software. Systems running the virtualization giant’s software accounted for $405.1 million in revenue in the fourth quarter, or 32 percent of the market. Nutanix was once again the runner up with $368.4 million in revenue and 29.5 percent.

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