Data Center Cooling Market to Hit USD 92,775.81 Mn by 2035, Growing at 15.50% CAGR - DC Market Insights

LONDON, Nov. 26, 2025 /PRNewswire/ --

Market overview

The Global Data Center Cooling Market size was valued at USD 10,617.23 million in 2020, increasing to USD 21,864.96 million in 2025, and is anticipated to reach USD 92,775.81 million by 2035, at a CAGR of 15.50% during the forecast period. The market growth reflects the rising penetration of hyperscale data centers, AI clusters, cloud computing, edge deployments, and high-density IT infrastructure. With increased global digital transformation, organizations demand scalable, energy-efficient thermal management systems to meet operational resilience, sustainability targets, and continuity requirements. Innovations in liquid cooling, immersion cooling, and modular cooling architectures continue to redefine system efficiency benchmarks while reducing operational costs and carbon emissions across facilities.

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Key growth determinants

Rising Data Center Construction and Hyperscale Expansion

The accelerating pace of global data center development is a major factor propelling the Data Center Cooling Market. Hyperscale operators—particularly cloud giants and AI computing clusters—are deploying large-scale infrastructure designed to support high-performance computing workloads. The increased server densities generate significant heat loads, requiring sophisticated cooling solutions to maintain optimal functionality and prevent hardware degradation. As colocation providers expand to meet enterprise outsourcing demand, the requirement for resilient and scalable cooling systems intensifies. Regional investments in digital infrastructure, 5G rollout, and cloud connectivity further contribute to the increasing adoption of advanced cooling systems in modern data centers.

Growing Adoption of AI, Machine Learning, and HPC Applications

Artificial intelligence, machine learning, high-performance computing, and generative AI workloads have dramatically increased heat output in modern computing environments. These high-density applications require cooling systems capable of supporting rack power densities exceeding traditional standards while maintaining operational efficiency. As computing continues transitioning toward high-performance processing environments, traditional air-based cooling becomes insufficient, driving increased adoption of liquid and hybrid cooling architectures. This technological shift is expected to accelerate the deployment of direct-to-chip, immersion, and water-based systems that offer superior thermal performance, energy savings, and lower power usage effectiveness (PUE), fueling sustained growth within the Data Center Cooling Market.

Increasing Sustainability Mandates and Energy Optimization Requirements

Regulatory mandates, enterprise sustainability targets, and rising operational energy costs are pushing data center operators to adopt environmentally efficient cooling systems. Traditional cooling systems consume substantial energy, contributing significantly to the facility's overall operational carbon footprint. Governments and industry regulators worldwide are enforcing compliance frameworks focused on reduced emissions, water conservation, and optimized energy utilization. As organizations adopt green data center strategies—including renewable energy integration, advanced airflow engineering, and liquid-based cooling—the demand for upgraded cooling infrastructure continues to rise. These initiatives support reduced operating expenditure (OpEx) and alignment with environmental responsibility commitments.

Key growth barriers

High Capital Expenditure and Infrastructure Complexity

The high initial investment cost associated with advanced cooling technologies poses a significant challenge to market growth. Installation of liquid cooling, advanced heat exchangers, and high-efficiency chillers often requires extensive facility upgrades, specialized engineering, and ongoing maintenance. Smaller enterprises and legacy facility owners may find the transition economically restrictive, creating barriers to modernization. Integration complexities further arise when cooling systems must operate within mixed environments that include legacy infrastructure and diverse density workloads. These financial and operational constraints may slow adoption, especially across developing markets and small-scale IT environments where budget limitations and capacity constraints remain prevalent.

Key market trends

Shift Toward Liquid Cooling and Immersion Cooling Technologies

The market is witnessing a growing shift from traditional air cooling to advanced liquid cooling technologies, including immersion and direct-to-chip cooling. These solutions are increasingly adopted in high-density computing environments where traditional cooling methods are no longer sufficient. Liquid cooling offers superior thermal efficiency, reduced energy consumption, and enhanced support for AI-driven workloads. As rack-level heat output continues to rise, liquid cooling adoption is accelerating across hyperscale and enterprise facilities. This trend reflects growing technological alignment with sustainability objectives and operational resiliency as data centers transition toward next-generation compute architectures supporting more demanding workloads.

Key opportunities

Expansion of Edge Data Centers and Distributed Computing Environments

The accelerating adoption of 5G, IoT ecosystems, and distributed computing is driving increased deployment of edge data centers. These compact and remote facilities require highly efficient, compact, and automated cooling systems designed to operate in variable environmental conditions. The opportunity for innovative cooling solutions such as modular cooling, integrated rack cooling, and micro-liquid cooling systems is increasing as enterprises invest in infrastructure designed to reduce latency and support real-time processing. Emerging geographic markets and sectors—including smart cities, autonomous mobility, and industrial automation—present significant expansion potential for cooling vendors offering scalable, efficient, and low-maintenance solutions.

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Competitive Insights:

• Accelsius LLC
• Air Enterprises
• ALFA LAVAL
• Asetek, Inc.
• Boyd
• Carrier
• Chilldyne, Inc.
• Climaveneta Climate Technologies PVT. LTD.
• Condair Group
• Coolcentric (Heico Companies LLC)
• CoolIT Systems
• Danfoss
• DCX Liquid Cooling Systems
• Dell Inc.
• Fujitsu
• Hitachi, Ltd.
• JETCOOL Technologies Inc (Flex Ltd.)
• Johnson Controls International plc
• LiquidStack Holding B.V.
• Midas Immersion Cooling
• Mitsubishi Electric Corporation
• Modine Manufacturing Company
• Munters
• Nortek Air Solutions, LLC
• NTT Ltd.
• nVent
• PEZY Computing K.K.
• Rittal GmbH & Co. KG
• Schneider Electric
• STULZ GMBH
• Submer
• Vertiv Group Corp.
• ZutaCore, Inc.

Regional analysis

The Data Center Cooling Market demonstrates strong regional demand patterns driven by digital infrastructure maturity, investment trends, regulatory frameworks, and technological readiness. North America continues to lead the global market owing to high concentration of hyperscale operators, cloud service providers, and large-scale colocation facilities. The region benefits from substantial investment in AI-based infrastructure, edge deployments, and next-generation cooling technologies, reinforcing its position as a key adoption hub.

Europe stands as a rapidly evolving region with heightened focus on regulatory sustainability mandates, energy efficiency policies, and climate neutrality targets. Countries including Germany, the Netherlands, Sweden, and the UK are prioritizing green data center design, accelerating adoption of renewable energy-powered cooling systems, free-air cooling, and liquid-based technologies.

Asia-Pacific is poised for significant growth fueled by expanding digital infrastructure, rising internet penetration, and aggressive cloud investments across China, India, Japan, and Southeast Asia. The growing footprint of hyperscale facilities and local enterprise digital transformation initiatives are expected to elevate regional market share. Meanwhile, Latin America, the Middle East, and Africa are emerging regions gaining traction due to increasing deployment of colocation centers and edge computing ecosystems. Collectively, regional development trends indicate widespread cooling technology modernization, with sustainability and scalability shaping future investment priorities.

DC Market Insights's Competitive Landscape Analysis

The Data Center Cooling Market remains competitive and highly innovation driven, with industry players focusing on energy efficiency, scalability, and advanced thermal engineering solutions. The competitive ecosystem comprises global cooling technology providers, infrastructure OEMs, cloud operators, and specialized engineering service firms. Strategic partnerships, product innovation, and research and development investments drive competitive positioning. Manufacturers are increasingly adopting AI-based monitoring, automated control systems, and predictive analytics to optimize cooling performance and operational efficiency. As cooling needs intensify, companies that deliver sustainable, cost-efficient, and performance-optimized systems are expected to strengthen market presence. The race toward next-generation cooling architectures is shaping a dynamic and rapidly evolving competitive environment.

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