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IBM storage still dropping, looking for a save from flash

Storage received a lot of attention on the IBM earnings call Monday night. And not in a good way.

IBM systems storage revenue decreased 19% year-over-year last quarter, which isn’t unusual over the past few years. But poor storage sales dragged down all of IBM’s hardware, which declined two percent overall.

The poor storage performance came in high-end disk systems and tape. Flash grew more than 50% year-over-year for the third straight quarter, so IBM is looking to rebuild its storage business around flash, Spectrum software and cloud/object storage from its recent Cleversafe acquisition.

“I think this is the most we’ve talked about storage on this call in over a year,” IBM CFO Martin Schroeter said during the earnings call. “But I’m glad because this is an important part of the business, and we see a lot of opportunity in storage.”

IBM launched new high-end DS8880 enterprise arrays last week, but Schroeter said he doesn’t see that part of the business getting much stronger. Flash is driving array sales, particularly in the IBM FlashSystem all-flash arrays.

IBM is also pushing storage software, which it-rebranded under the Spectrum umbrella earlier this year.

Schroeter admitted “storage continues to be a tough market” but emphasized that IBM is not throwing in the storage towel.

“There is a future in storage, and it’s all about flash,” he said. “It’s all about software-defined and it’s all about object storage. … The faster we can move to flash, and the faster we can build out our high-value software-defined storage platforms … the sooner we’ll see a return to growth in storage.”

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