Market overview

The global data center cooling components market was valued at USD 19,915.8 million in 2025 and is projected to reach USD 66,114.0 million by 2032, expanding at a compound annual growth rate (CAGR) of 18.70% over 2025 to 2032. The market has already more than tripled since 2017, when it stood at USD 5,645.3 million, and year-on-year growth has accelerated every year from 17.4% in 2021 to a projected 19.3% in 2032. In volume terms, shipments are forecast to rise from about 120.2 million units in 2025 to 380.3 million units in 2032.

The driving force is compute density. AI training clusters and GPU-heavy inference racks now draw several times the power of a conventional enterprise rack, and air alone can no longer carry that heat away efficiently. Operators are responding with a two-track strategy: upgrading room-level air systems (CRACs and CRAHs) in existing halls, while adding liquid loops, chillers, cooling towers and coolant distribution units for new high-density capacity. Vendors such as Schneider Electric now describe direct-to-chip cooling as the leading approach for AI workloads, and liquid-based systems already account for just over half of market revenue.

Market dynamics

How AI density turns into component demand

Market segmentation

The report breaks the market down by component type, cooling equipment type (with sub-segments for air-based and liquid-based systems), end user and data center tier, each sized for 2017 to 2032 at global, regional and country level.

By cooling equipment type: liquid overtakes air

Liquid-based cooling systems generated USD 10,029.9 million in 2025, a 50.4% share, edging past air-based systems at USD 9,235.5 million (46.4%). Growing at a 20.52% CAGR against 16.70% for air, liquid systems are forecast to hold 56.0% of the market by 2032, worth USD 37,032.9 million. Air cooling remains a large, steady business, driven by the huge installed base of CRAC and CRAH units in enterprise and colocation halls.

Sub-segments: direct-to-chip is the breakout category

Within liquid-based systems, chillers remain the largest sub-segment in 2025 (USD 4,501.1 million), followed by cooling towers (USD 2,876.2 million). Direct-to-chip cooling units, however, grow at 26.79% a year, rising from USD 2,652.6 million to USD 13,974.7 million and overtaking chillers as the single largest liquid sub-segment by 2032. On the air side, CRACs (USD 4,879.9 million) still lead CRAHs (USD 4,355.5 million), though CRAHs grow faster at 17.24% as chilled-water designs spread in large facilities.

By component type

Electrical and control components form a small but strategically important slice of the market. Controllers and PLCs were worth USD 329.7 million in 2025 and are expected to reach USD 1,008.7 million by 2032 (17.32% CAGR), as operators demand tighter supervisory control of pumps, valves and fans. Variable frequency drives, which let fans, pumps and compressors run at partial load, generated USD 198.2 million in 2025 and grow at 13.69% to USD 486.5 million. Automation suppliers such as ABB, Siemens and Rockwell Automation compete here. The remaining components (heat exchangers, pumps, fans, cold plates, fluid connectors and others) account for USD 19,387.9 million.

By end user: retrofit demand gains ground

OEM sales led in 2025 with USD 11,179.4 million (56.1%), reflecting components built into new chillers, CRAH units and server racks. The aftermarket and retrofit segment, worth USD 8,736.5 million, is growing faster at 19.76% as operators upgrade existing halls for denser loads rather than build from scratch. By 2032 the gap narrows to 53.3% vs 46.7%. North America is already retrofit-led, with aftermarket revenue of USD 4,139.4 million against USD 2,827.3 million for OEM in 2025.

By data center tier

Tier III facilities, the standard for most colocation and enterprise sites, account for 57.8% of 2025 revenue (USD 11,517.8 million). Tier IV sites carry the highest redundancy requirements (often 2N cooling paths), and their spending grows fastest at a 20.03% CAGR to USD 14,684.6 million by 2032. Tier I and II facilities contributed USD 4,306.8 million in 2025.

Regional analysis

North America was the largest regional market in 2025 at USD 6,966.7 million (35.0% share), with the United States alone contributing USD 5,867.8 million. It is also the most liquid-heavy region: liquid-based systems made up USD 3,846.8 million of North American revenue, well ahead of air. Asia Pacific follows at USD 6,022.0 million and is the fastest-growing region at 19.91%, closing most of the gap by 2032 (USD 21,466.1 million vs USD 22,173.4 million). Europe (USD 4,901.5 million) remains air-led, with air-based systems still accounting for about 60% of regional revenue in 2025. The Middle East and Africa grows at 19.42%, supported by large-scale builds in Saudi Arabia.

Country outlook

India is the fastest-growing country in the study at 21.26%, as hyperscalers and local operators expand capacity and new policy-backed projects, such as the Madhya Pradesh government’s data centre agreement with Submer, come through. Saudi Arabia (20.32%), China (19.92%) and South Korea (19.61%) follow. Germany is the largest European market at USD 1,182.2 million, ahead of the United Kingdom (USD 1,008.9 million) and France (USD 866.6 million).

Competitive landscape

Data center cooling is a contest between two very different kinds of company. On one side are full-line thermal and electrical majors that can sell everything from the chiller on the roof to the controller in the white space. On the other are liquid and immersion specialists whose technology sits closest to the chip, where the fastest growth is. Since 2022 the majors have been buying their way toward the chip, while the specialists have raised capital and added factory space to keep up with AI demand. This section examines that contest through five lenses.

1. Vendor landscape

Twenty vendors are profiled in this study. They fall into four tiers by portfolio breadth and by where in the thermal chain they compete: from room and plant equipment, through the rack, down to the chip itself.

Where vendors play in the thermal chain. Heat moves from the chip to the atmosphere through five stages. The further left a vendor sits, the more exposed it is to the fastest-growing direct-to-chip segment (26.79% CAGR).

Product portfolio matrix. The table maps each vendor’s offer against the seven product families tracked in this report.

Table 1. Product portfolio matrix.   core offering,   partial offering, component supply or via partner, – not a focus. Indicative, based on public product pages.

2. Competitive environment

Rivalry is high and rising. Hyperscale buyers purchase at enormous scale, run competitive tenders and increasingly specify their own reference designs, which compresses margins on commodity air equipment. At the same time, the shift to liquid cooling has lowered the barrier for well-funded specialists, so incumbents face new challengers exactly where growth is strongest. The five forces below summarise the balance of power.

Competitive intensity by segment. Rivalry is sharpest where growth is fastest. Direct-to-chip and CDU supply now attracts almost every major vendor, while drives and controls remain a more stable, relationship-driven market.

3. Merger & acquisition analysis

Consolidation has accelerated alongside the AI build-out. Of the 11 transactions tracked between 2022 and 2025, five brought liquid cooling hardware (CDUs, cold plates, rear-door coolers or GPU cooling cabinets) into a larger group, and three added chiller or HVAC capacity. The pattern is consistent: full-line vendors are buying technology closer to the chip, while the most recent deals, such as Vertiv’s roughly USD 1.0 billion purchase of PurgeRite, move into lifecycle services for liquid loops.

Table 2. Mergers and acquisitions in data center cooling, 2022 to 2025. Dates refer to announcement, except PurgeRite (completion).

What the deals tell us. Three themes stand out. First, vertical integration toward the chip: Schneider Electric (Motivair), Vertiv (CoolTera) and Daikin Applied (DDC Solutions) each bought liquid or rack-level cooling rather than building it. Second, chiller capacity as a bottleneck: Munters (Geoclima) and Vertiv (BiXin) both added chiller technology as liquid loops increase heat-rejection demand. Third, services as the next battleground: PurgeRite and Waylay.io show Vertiv building revenue around the installed liquid base. Independent specialists such as Iceotope, Submer and DCX are the kind of assets that fit this pattern, so further consolidation looks likely.

4. Strategy framework

Company moves are grouped using the Ansoff growth matrix, then detailed by strategy type in the tables that follow.

Strategy A: New product development. The most common strategy, concentrated in CDUs and direct-to-chip systems.

Table 3. New product development initiatives.

Strategy B: Capacity and geographic expansion. Vendors are adding factories and engineering hubs in Europe and entering high-growth Asian markets.

Table 4. Capacity and geographic expansion initiatives.

Strategy C: Mergers and acquisitions. Strategic acquirers only; see the M&A analysis above for full detail.

Table 5. Strategic acquisitions by profiled and related companies.

Strategy D: Partnerships, agreements and investments. Partnerships let vendors fill portfolio gaps, especially in immersion and integrated power-plus-cooling designs, without the cost of acquisition.

Table 6. Partnerships, agreements, funding and major contracts.

Recent developments timeline.

5. Heat map analysis

Three heat maps summarise where the growth is, who is equipped to capture it, and who is acting most aggressively.

Heat map A: Segment growth by region. Direct-to-chip is the hottest cell in every region, led by Asia Pacific (28.1%) and the Middle East & Africa (27.5%). Aftermarket and Tier IV demand also run above 19% in every region, while VFDs are the coolest cells.

Heat map B: Vendor capability. Only Schneider Electric and Vertiv score high across air, plant and direct-to-chip. Specialists score high on one liquid column but low on breadth, which is exactly the gap the recent acquisitions have been closing.

Heat map C: Strategic activity. Counting the moves catalogued in Tables 2 to 6, Vertiv is the most active company, combining product launches with four acquisitions. Munters, STULZ and CoolIT follow, each pairing new products with capacity or contract wins.

Key company profiles and sources

Each profile summarises the company’s positioning in data center cooling and lists the source pages used for this report.

Report scope