The global Liquid Cooling for Data Center market was valued at approximately USD 1,982 million in 2023, and it is projected to reach USD 11,101.99 million by 2032, reflecting a robust CAGR of 21.10% during the forecast period. This rapid growth trajectory is attributed to the increasing need for efficient thermal management in data centers, especially as organizations adopt AI, IoT, and other data-intensive technologies.

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Liquid cooling for data centers refers to the use of liquid-based technologies typically water or specialized coolants to absorb and dissipate heat generated by high-performance computing (HPC) systems, servers, storage devices, and networking hardware. The global liquid cooling for data centre market is experiencing rapid growth as hyperscale and enterprise data centres face increasing demands for high performance and energy efficiency. Traditional air cooling methods are struggling to manage the heat generated by high-density computing workloads, especially with the rise of AI, machine learning, and high-performance computing (HPC). As a result, liquid cooling technologies such as direct-to-chip and immersion cooling are gaining traction due to their ability to reduce power usage effectiveness (PUE) and support sustainable operations.

For instance, Meta announced plans to deploy immersion cooling technologies across select data centres to reduce energy consumption and carbon footprint highlighting a shift toward environmentally conscious infrastructure.

Market Size

Global Liquid Cooling for Data Center Market Size and Forecast

In North America, the market was estimated at USD 720.15 million in 2023 and is anticipated to expand at a CAGR of 18.09% from 2025 through 2032. The United States leads the regional market due to the presence of numerous hyperscale data centers and cloud service providers.

The market expansion is also supported by growing investments in green data center infrastructure, along with regulatory mandates aimed at improving energy efficiency and reducing greenhouse gas emissions. The long-term outlook for the liquid cooling market is promising, with continued innovation and adoption of advanced technologies across the globe.

Market Dynamics (Drivers, Restraints, Opportunities, and Challenges)

Drivers

Rising Data Processing Demands Are Driving the Shift to Liquid Cooling

The rise in data processing demands, especially from AI, big data analytics, and high-performance computing (HPC), is one of the main factors propelling the expansion of liquid cooling in data centers. Compared to conventional applications, these workloads produce a lot more heat, which makes air cooling ineffective and expensive. Liquid cooling technologies such as direct-to-chip and immersion cooling offer up to 1,000 times greater heat dissipation efficiency than air-based systems.

For instance, Intel and Submer collaborated to implement next-generation immersion cooling in Intel's data centers, claiming better thermal performance for AI workloads and lower energy consumption. This is in line with a larger trend in the industry, where liquid cooling is being used more and more by hyperscale data centers to preserve operational stability and satisfy ESG objectives.

Restraints

High Initial Investment and Infrastructure Complexity Limit Adoption

Despite its benefits, the high initial cost and difficulty of integrating these systems into the current data center infrastructure pose serious barriers to the widespread use of liquid cooling technologies. Large-scale server rack, plumbing, and safety system redesigns are frequently necessary when retrofitting legacy buildings with liquid cooling, which can interfere with ongoing operations and raise the risk of downtime.For instance, many small to medium-sized data centre operators hesitate to adopt liquid cooling because the costs and operational challenges outweigh the immediate benefits, slowing widespread market penetration.

Opportunities

Growing Demand from Hyperscale Data Centres

A major growth opportunity for the liquid cooling market is the quick development of hyperscale data centers, which are being fueled by cloud computing giants like Microsoft Azure, Google Cloud, and Amazon Web Services. To handle the excessive heat loads produced by dense server configurations, these facilities need cooling solutions that are both scalable and extremely efficient.One efficient method for raising energy efficiency and lowering operating expenses on a large scale is liquid cooling.Moreover the growing demand for high-performance computing and AI workloads has led to significant investments in liquid cooling technologies. Companies are forming strategic partnerships to enhance cooling efficiency and reduce environmental impact.

For instance, in May 2025, Microsoft and NVIDIA announced a collaboration to integrate NVIDIA's next-generation GPUs with Microsoft's liquid cooling systems. This partnership aims to optimize AI workloads by providing efficient thermal management solutions. The integration is expected to enhance computational performance while maintaining energy efficiency.

Challenges

Lack of Industry Standards and Interoperability Slows Adoption

The absence of unified industry standards and interoperability frameworks for liquid cooling systems presents a significant challenge. Data centre operators often deal with proprietary solutions that lack compatibility with diverse server hardware, which complicates integration and raises vendor lock-in concerns.For example, while companies like Submer, LiquidStack, and Vertiv offer cutting-edge immersion and direct-to-chip solutions, their systems can differ widely in design, connector types, and thermal interface materials. This fragmentation makes it difficult for operators to scale or transition between providers without major redesigns.

According to a survey by Castrol, For the industry to continue seeing performance gains, experts predict that immersion cooling must be implemented within the next three years. Those who don't do this run the risk of lagging behind competitors at a time when data centers are under a lot of strain due to AI surges.

Regional Analysis

Market Trends by Region

North America remains at the forefront of adopting liquid cooling technologies, primarily driven by the escalating demands of AI and high-performance computing workloads. Meta has initiated a transition to direct-to-chip liquid cooling for its AI infrastructure, aiming to enhance energy efficiency and support higher-density computing. Europe is witnessing significant advancements, propelled by stringent sustainability goals and innovative collaborations. In Germany, Equinix has partnered with local entities to channel excess heat from its Frankfurt data centres into a district heating system, set to supply approximately 1,000 households starting in 2025. Similarly, in the Netherlands, Equinix signed a letter of intent with the Municipality of Diemen to explore utilizing residual heat from its AM4 data centre to support local heating needs.Asia-Pacific is emerging as a dynamic market for liquid cooling solutions. In Japan, NTT Communications, in collaboration with Mitsubishi Heavy Industries and NEC, commenced a demonstration of two-phase direct-to-chip cooling in an operational Tokyo data centre. This initiative aims to enhance cooling capacity without significant modifications to existing facilities, aligning with energy-saving and CO₂ reduction goals.South America's data centre market is experiencing significant growth, driven by the increasing adoption of cloud services, digital transformation initiatives, and a focus on sustainable infrastructure.Amazon Web Services (AWS) announced a $4 billion investment to establish its first data centres in Chile, marking its third cloud region in Latin America after Brazil and Mexico.The MEA region is witnessing a surge in data centre developments, fueled by digital transformation, increased internet penetration, and government initiatives promoting technological advancement

Competitor Analysis 

Major Players and Market Landscape

The Liquid Cooling for Data Center market is moderately consolidated with several global and regional players competing based on product innovation, energy efficiency, scalability, and reliability.

Key players include:

• Vertiv: Offers integrated liquid cooling systems with scalable modularity.

• Stulz: Specializes in precision cooling and modular cooling technologies.

• CoolIT Systems: Known for direct-to-chip liquid cooling.

• Schneider Electric: Provides EcoStruxure cooling systems for high-density environments.

• Submer and Green Revolution Cooling: Leaders in immersion cooling solutions.

Most companies are focusing on partnerships, R&D investments, and strategic acquisitions to strengthen their market position and expand their product portfolios.

2025, Intel advanced its Superfluid cooling technology, utilizing microbubble injection and dielectric fluids to improve heat transfer. This innovation supports Nvidia's megawatt-class rack servers, addressing the thermal demands of high-performance AI infrastructures.

October 2024,Schneider Electric agreed to buy a majority share in Motivair Corp.for about USD 850 million, a leader in liquid cooling for high-performance computing. By taking this action, Schneider Electric hopes to improve its standing in the data center cooling industry.

December 2024, Vertiv acquired BiXin Energy (China), specializing in centrifugal chiller technology, enhancing Vertiv's capabilities in high-performance computing and AI cooling solutions.

December 2023,Equinix, Inc.a global digital infrastructure company, announced plans to extend support for cutting-edge liquid cooling technologies, such as direct-to-chip, to over 100 of its International Business Exchange® (IBX®) data centers located in over 45 metropolitan areas worldwide.

December 2023, Vertiv expanded its portfolio of cutting-edge cooling technologies with the acquisition of CoolTera Ltd (UK), a business specializing in liquid cooling infrastructure solutions.

Global Liquid Cooling for Data Center Market: Market Segmentation Analysis

This report provides a deep insight into the global Liquid Cooling for Data Center Market, covering all its essential aspects. This ranges from a macro overview of the market to micro details of the market size, competitive landscape, development trend, niche market, key market drivers and challenges, SWOT analysis, value chain analysis, etc.

The analysis helps the reader to shape the competition within the industries and strategies for the competitive environment to enhance the potential profit. Furthermore, it provides a simple framework for evaluating and assessing the position of the business organization. The report structure also focuses on the competitive landscape of the Global Liquid Cooling for Data Center Market. This report introduces in detail the market share, market performance, product situation, operation situation, etc., of the main players, which helps the readers in the industry to identify the main competitors and deeply understand the competition pattern of the market.

In a word, this report is a must-read for industry players, investors, researchers, consultants, business strategists, and all those who have any kind of stake or are planning to foray into the Liquid Cooling for Data Center Market in any manner.

Market Segmentation (by Cooling Type)

• Direct-to-Chip (Cold Plate) Cooling

• Immersion Cooling

• Other Liquid Cooling Solutions

Market Segmentation (by Data Center Type)

• Hyperscale Data Centers

• Enterprise Data Centers

• Colocation Providers

• Modular/Edge Data Centers

• Cloud Providers

Market Segmentation (by End Use Industry)

• IT & Telecom

• BFSI (Banking, Financial Services, and Insurance)

• Healthcare

• Government & Defense

• Energy & Utilities

• Manufacturing

• Cloud & Hyperscale Providers

• Others

Key Company

• Vertiv

• Stulz

• Midas Immersion Cooling

• Rittal

• Envicool

• CoolIT

• Schneider Electric

• Sugon

• Submer

• Huawei

• Green Revolution Cooling

• Eco-atlas

Geographic Segmentation

• North America (USA, Canada, Mexico)

• Europe (Germany, UK, France, Russia, Italy, Rest of Europe)

• Asia-Pacific (China, Japan, South Korea, India, Southeast Asia, Rest of Asia-Pacific)

• South America (Brazil, Argentina, Columbia, Rest of South America)

• The Middle East and Africa (Saudi Arabia, UAE, Egypt, Nigeria, South Africa, Rest of MEA)

FAQs : 

▶ What is the current market size of the Liquid Cooling for Data Center Market?

As of 2023, the global Liquid Cooling for Data Center market was valued at approximately USD 1,982 million.

▶ Which are the key companies operating in the Liquid Cooling for Data Center Market?

Major players include Vertiv, Stulz, CoolIT Systems, Schneider Electric, Submer, Huawei, and Green Revolution Cooling, among others.

▶ What are the key growth drivers in the Liquid Cooling for Data Center Market?

Key growth drivers include rising power densities in data centers, the demand for energy-efficient solutions, and the growing deployment of AI and HPC applications.

▶ Which regions dominate the Liquid Cooling for Data Center Market?

North America currently leads the market, followed by Europe and Asia-Pacific. Asia-Pacific is expected to witness the fastest growth in the forecast period.

▶ What are the emerging trends in the Liquid Cooling for Data Center Market?

Emerging trends include the growing adoption of immersion cooling, development of sustainable coolant technologies, and integration of AI-based monitoring systems for thermal management.

 

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