Data Center Liquid Cooling Market

Market Definition

The market comprises thermal management systems designed to efficiently remove heat from high-density computing environments. It includes direct-to-chip cooling, immersion cooling, coolant distribution units, and control systems.

The market supports deployment across hyperscale, enterprise, and colocation data centers, enabling performance optimization in workloads related to cloud computing, artificial intelligence, and high-performance computing. The report examines industry trends, regional developments, and regulatory frameworks impacting market growth through the projection period.

Data Center Liquid Cooling Market Overview

The global data center liquid cooling market size was valued at USD 3880.5 million in 2024 and is projected to grow from USD 4881.7 million in 2025 to USD 24887.4 million by 2032, exhibiting a CAGR of 26.09% during the forecast period. The global expansion of 5G infrastructure and the shift toward liquid-based cooling for high-density computing is driving the growth of the market.

Major companies operating in the data center liquid cooling industry are Vertiv Group Corp, Submer, Schneider Electric, LiquidStack Holding B.V., COOLIT SYSTEMS., DUG Technology, DCX INC, Delta Power Solutions, Wiwynn Corporation, Midas Immersion Cooling, Boyd., Chilldyne, Inc., Asperitas, ZutaCore, Inc., and FLEX LTD.

The market is driven by the growth of cloud computing and big data analytics, which demand high-performance computing infrastructure and dense server configurations. This increases heat generation, making traditional air-cooling methods insufficient. Liquid cooling addresses these thermal challenges efficiently, supporting system reliability and energy optimization across hyperscale, enterprise, and edge data centers.

Key Highlights:

1. The data center liquid cooling industry size was recorded at USD 3880.5 million in 2024.
2. The market is projected to grow at a CAGR of 26.09% from 2025 to 2032.
3. North America held a market share of 34.09% in 2024, with a valuation of USD 1322.7 million.
4. The solution segment garnered USD 2445.1 million in revenue in 2024.
5. The large data center segment is expected to reach USD 14676.1 million by 2032.
6. The server cooling segment secured the largest revenue share of 33.24% in 2024.
7. The colocation providers segment is poised to grow at a robust CAGR of 26.23% through the forecast period.
8. Asia Pacific is anticipated to grow at a CAGR of 27.26% during the forecast period.

Market Driver

5G Expansion Fueling Adoption of Liquid Cooling Systems

The data center liquid cooling market is driven by the expansion of 5G infrastructure, which significantly amplifies data traffic and computing workloads. The surge in low-latency applications and edge computing requirements is intensifying thermal output across network nodes. Liquid cooling systems are increasingly deployed to manage this rising heat load efficiently, ensuring performance stability and operational continuity in high-density environments.

• According to the 5G Americas organization, 5G connections reached 2.25 billion globally in 2024. This rapid growth is increasing the need for effective thermal management solutions, thereby accelerating the demand for liquid cooling systems in data-intensive infrastructure.

Market Challenge

High Deployment Costs and Infrastructure Complexity

The data center liquid cooling market faces challenges related to the high upfront costs of deployment and the need for specialized infrastructure, which limit adoption among small and mid-sized data centers. Integration with existing air-cooled systems further increases design complexity and installation time.

To address these challenges, manufacturers are developing modular and retrofit-compatible solutions to reduce capital expenditure and simplify implementation. Partnerships with data center operators are being formed to demonstrate long-term efficiency gains and support broader market acceptance.  

Market Trend

Transition Toward Advanced Liquid Cooling Solutions

The data center liquid cooling market is witnessing a growing shift from traditional air cooling to liquid based solutions, particularly in high density computing environments. This trend includes the adoption of direct-to-chip and immersion cooling technologies to manage rising thermal loads more efficiently.

The market is increasingly focusing on advanced cooling methods to support higher processing densities, improved energy efficiency, and space optimization within modern data centers.

• In October 2024, Hewlett Packard Enterprise introduced the industry’s first 100% fanless direct liquid cooling architecture for large-scale AI deployments. This new solution claims to reduce cooling power per server blade by 37%, thereby lowering utility costs, carbon emissions, and data center noise.

Data Center Liquid Cooling Market Report Snapshot

Segmentation	Details
By Component	Solution (Indirect, Direct), Services (Professional, Managed)
By Data Center Size	Small & Medium Data Center, Large Data Center
By Application	Server Cooling, Storage Cooling, Networking Cooling
By End Use	Colocation Providers, Enterprises (BFSI, IT & Telecommunications, Healthcare, Government, Retail), Hyperscale Data Centers
By Region	North America: U.S., Canada, Mexico
	Europe: France, UK, Spain, Germany, Italy, Russia, Rest of Europe
	Asia-Pacific: China, Japan, India, Australia, ASEAN, South Korea, Rest of Asia-Pacific
	Middle East & Africa: Turkey, U.A.E., Saudi Arabia, South Africa, Rest of Middle East & Africa
	South America: Brazil, Argentina, Rest of South America

Market Segmentation:

• By Component (Solution and Services): The solution segment earned USD 2445.1 million in 2024 due to its comprehensive offerings that enable efficient thermal management and energy savings in high-density data center environments.
• By Data Center Size (Small & Medium Data Center and Large Data Center): The large data center held 59.94% of the market in 2024, due to its higher demand for advanced cooling solutions to manage increased heat generated by dense computing infrastructure.
• By Application (Server Cooling, Storage Cooling, Networking Cooling): The server cooling segment is projected to reach USD 8194.4 million by 2032, owing to its critical role in maintaining optimal temperatures for high-performance servers and preventing overheating in data centers.
• By End Use (Colocation Providers, Enterprises, and Hyperscale Data Centers): The enterprises segment earned USD 1464.3 million in 2024 due to its extensive adoption of liquid cooling solutions to support growing IT infrastructure and ensure operational efficiency.

Data Center Liquid Cooling Market Regional Analysis

Based on region, the market has been classified into North America, Europe, Asia Pacific, Middle East & Africa, and South America.

North America data center liquid cooling market share stood at 34.09% in 2024 in the market, with a valuation of USD 1322.7 million. This dominance is attributed to substantial government investments aimed at enhancing data center infrastructure and strengthening the digital ecosystem.

These investments focus on upgrading existing facilities, promoting energy-efficient cooling technologies, and supporting innovation in liquid cooling solutions. Additionally, policies encouraging sustainable IT operations and digital transformation initiatives are further driving market growth in this region.

• In April 2025, the U.S. Department of Energy (DOE) announced plans to lower energy costs by co-locating data centers with energy infrastructure on DOE lands. The DOE released a Request for Information (RFI) to explore potential AI infrastructure development at 16 identified sites suitable for rapid data center construction.

Asia Pacific data center liquid cooling industry is poised for significant growth at a robust CAGR of 27.26% over the forecast period. This growth is driven by digital transformation and increasing demand for high-performance computing.

The region is witnessing significant government investments in cloud infrastructure, edge computing, and hyperscale data centers, which require advanced cooling solutions to manage thermal loads. Additionally, rising energy efficiency regulations and sustainability initiatives are accelerating the adoption of liquid cooling technologies across the region.

Regulatory Frameworks

• In the US, the Occupational Safety and Health Administration (OSHA) establishes workplace safety regulations governing the installation and maintenance of liquid cooling systems.
• In China, the Ministry of Ecology and Environment (MEE) enforces environmental regulations that encourage energy efficiency and minimize waste in data centers, thereby supporting the adoption of liquid cooling technologies.

Competitive Landscape

The data center liquid cooling industry is witnessing a series of launches introducing advanced thermal management technologies suited for high-performance computing environments. Leading companies are introducing solutions including direct-to-chip and immersion cooling systems, aimed at maximizing energy efficiency and reducing operational overhead.

These launches are defining a competitive landscape centered on innovation and technological advancement, as market participants focus on enhancing infrastructure capabilities and securing a stronger position in the data center sector.

• In April 2025, Daikin expanded its data center cooling portfolio by launching the Pro-C CRAH. Engineered to accommodate diverse data center configurations, the unit features an optimized design and advanced control strategies to enhance cooling performance and efficiency.

List of Key Companies in Data Center Liquid Cooling Market:

• Vertiv Group Corp
• Submer
• Schneider Electric
• LiquidStack Holding B.V. 
• COOLIT SYSTEMS. 
• DUG Technology
• DCX INC
• Delta Power Solutions 
• Wiwynn Corporation
• Midas Immersion Cooling
• Boyd.
• Chilldyne, Inc.
• Asperitas
• ZutaCore, Inc.
• FLEX LTD.

Recent Developments (Product Launch/Expansion)

• In November 2024, Vertiv expanded its liquid cooling portfolio with the addition of two new Vertiv CoolChip Coolant Distribution Units (CDU). These systems support modular and cost-efficient liquid cooling deployments, allowing data centers to manage high-density computing workloads.
• In February 2024, Submer expanded its operations by establishing new business units focused on data center design. The company aims to develop next generation liquid-cooled data centers incorporating both direct liquid cooling and immersion cooling to enable efficient, sustainable transitions from air cooling and support high-density AI workloads.