Data Center Cooling Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Product (Air Conditioners, Precision Air Conditioners, Liquid Cooling, Air Handling Unit, and Others), By Data Center Type (Large Scale, Medium Scale, and Small Scale), By Cooling Technique (Room-based Cooling, Rack-based Cooling, and Row-based Cooling), By Region, By Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 16.05 Billion
CAGR (2026-2031)	11.29%
Fastest Growing Segment	Air Conditioners
Largest Market	North America
Market Size (2031)	USD 30.49 Billion

Market Overview

The Global Data Center Cooling Market will grow from USD 16.05 Billion in 2025 to USD 30.49 Billion by 2031 at a 11.29% CAGR. Data center cooling consists of the collective systems and equipment designed to regulate temperature and humidity levels within critical IT facilities. The primary driver propelling this market is the rapid acceleration of artificial intelligence and high density computing which requires robust thermal management to support increasing server loads. This intensifying demand has created a discrepancy between existing capabilities and necessary performance. According to AFCOM, in 2024, 38% of data center professionals stated that their current cooling solutions were inadequate for their operational needs. Consequently, facility operators are compelled to modernize their infrastructure to ensure reliability.

The market faces a substantial challenge regarding environmental sustainability and resource efficiency. The significant electricity required for effective cooling often conflicts with strict regulatory frameworks and corporate carbon reduction goals. Furthermore, water availability in arid regions limits the implementation of evaporative cooling methods and forces companies to seek alternative strategies. These environmental constraints present a formidable obstacle to market expansion as operators struggle to balance performance requirements with resource conservation.

Key Market Drivers

The rapid proliferation of artificial intelligence and machine learning workloads is fundamentally reshaping the Global Data Center Cooling Market. As operators deploy power-intensive algorithms for generative AI training and inference, the thermal output of IT infrastructure has spiked dramatically, necessitating advanced thermal management solutions beyond traditional air-based methods. This surge in high-performance computing requirements compels facility managers to adopt more aggressive cooling strategies to maintain operational stability and prevent equipment failure. According to AI Magazine, September 2025, global power demand from data centers is forecast to rise 165% by 2030 from 2023 levels, driven largely by the massive energy footprint of these accelerated computing tasks. This trajectory underscores the urgent need for cooling infrastructure capable of handling unprecedented thermal loads while minimizing energy volatility.

Escalating rack power densities and high-performance computing requirements further accelerate the demand for innovative cooling technologies. Modern server configurations, particularly those integrating specialized accelerators, generate heat concentrations that render standard raised-floor cooling inefficient or obsolete. Consequently, the market is witnessing a decisive shift toward liquid and immersion cooling architectures designed to manage extreme thermal fluxes at the chip level. According to JLL, January 2025, in the '2025 Global Data Center Outlook', NVIDIA's latest AI chips consume up to 300% more power than their predecessors, a metric that directly correlates to the requisite cooling capacity. However, these advancements bring environmental challenges, particularly regarding resource consumption. According to the Pew Research Center, in 2025, hyperscale data centers alone are expected to consume between 16 billion and 33 billion gallons of water annually by 2028, highlighting the critical balance operators must strike between cooling performance and sustainability.

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Key Market Challenges

The substantial challenge of environmental sustainability and resource efficiency effectively throttles the expansion of the Global Data Center Cooling Market by imposing physical and financial limits on infrastructure deployment. Cooling systems are energy-intensive, and as facilities attempt to scale, they collide with regional power capacity ceilings and strict carbon reduction mandates. In many strategic data center hubs, local utility providers cannot supply the necessary electricity or water required for traditional cooling methods, leading to construction moratoriums. This lack of available resources prevents operators from building new facilities or upgrading existing ones, directly stalling the procurement and installation of cooling equipment.

Financial constraints resulting from resource inefficiency further dampen market growth. When cooling systems operate inefficiently, they drive up operating expenses, diverting capital that could otherwise fund infrastructure modernization or expansion. According to AFCOM, in 2024, 62% of data center professionals identified increasing energy costs as a key driver of their rising operational expenditures. This escalation in utility expenses forces organizations to pause capital projects to preserve liquidity, thereby reducing the aggregate demand for new cooling solutions and slowing the market's overall trajectory.

Key Market Trends

The implementation of waste heat recovery and reuse networks is emerging as a critical strategy to transform thermal byproducts into valuable energy assets, driven by stringent regulatory frameworks and decarbonization mandates. Operators are increasingly integrating data centers with district heating systems to capture and redirect excess thermal energy to nearby residential and commercial facilities, thereby reducing the overall carbon footprint of digital infrastructure. This shift converts a traditional operational liability into a revenue-generating utility service, aligning facility performance with circular economy principles. According to Equinix, April 2025, in the '2024 Sustainability Report', the company boosted its community heat export projects by 245% compared to the previous year, successfully returning 14.5 GWh of heat to local communities.

Simultaneously, the market is witnessing a decisive adoption of water-scarce and waterless cooling methodologies to mitigate the environmental impact of evaporative systems in drought-prone regions. As water availability becomes a primary constraint for facility siting and operation, companies are transitioning to closed-loop liquid cooling and advanced air-assisted designs that eliminate water consumption from the cooling process entirely. This trend is accelerating as major hyperscalers re-engineer their infrastructure to decouple thermal management from freshwater withdrawal, ensuring operational resilience against climate volatility. According to Microsoft, May 2025, in the '2025 Environmental Sustainability Report', the company's new data centers optimized for AI workloads will consume zero water for cooling, avoiding the use of an estimated 125,000 cubic meters of water annually per facility.

Segmental Insights

The Air Conditioners segment is currently positioned as the fastest-growing category within the Global Data Center Cooling Market, driven by the escalating demand for precision cooling technologies. As data facilities manage increasingly high-density workloads, the requirement for exacting temperature and humidity control to ensure equipment reliability has intensified. Operators are prioritizing advanced precision air conditioning units because they offer superior energy efficiency and stabilize complex server environments effectively. Furthermore, the ability to seamlessly retrofit these systems into existing infrastructures, unlike more invasive alternatives, significantly accelerates their adoption across hyperscale and enterprise data centers.

Regional Insights

North America maintains a dominant position in the global data center cooling market due to the high concentration of hyperscale facilities and cloud service providers within the region. The United States and Canada drive demand through substantial investments in IT infrastructure and a strong focus on energy efficiency to meet sustainability goals. Furthermore, adherence to thermal guidelines established by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) encourages the adoption of compliant cooling systems. This regulatory environment, combined with continuous expansion in data capacity, sustains the regional leadership in this sector.

Recent Developments

• In November 2025, nVent Electric plc unveiled a collaboration with Siemens to create a liquid cooling and power reference architecture tailored for hyperscale AI workloads. Announced at the SC25 conference, this partnership combined nVent’s expertise in liquid cooling with Siemens’ power infrastructure capabilities to improve operational resilience and global deployment speed for data centers. The General Manager of nVent Data Solutions highlighted that the initiative addressed the escalating power densities of next-generation chips. Concurrently, the company introduced new modular coolant distribution units and manifolds designed to meet the rigorous thermal requirements of major chip manufacturers.
• In February 2025, Vertiv launched a comprehensive Liquid Cooling Services portfolio globally to support the growing deployment of AI and high-performance computing applications. This new service offering was developed to manage the entire lifecycle of liquid-cooled systems, addressing the complexities of increased rack densities and heat loads. The portfolio included expert installation, commissioning, and fluid management services designed to ensure system reliability and optimal coolant quality. By providing detailed health documentation and proactive maintenance, the company aimed to help data center operators maintain operational continuity and maximize the performance of their critical liquid cooling infrastructure.
• In December 2024, Schneider Electric announced a significant partnership with NVIDIA to develop cooling designs specifically for AI data centers. The collaboration focused on creating reference architectures for high-density, liquid-cooled clusters, including those utilizing NVIDIA’s powerful Blackwell chips. These new designs incorporated liquid-to-liquid coolant distribution units and direct-to-chip cooling methods to handle power consumption of up to 132 kW per rack. The Senior Vice President of Schneider’s secure power division noted that the engineering cooperation aimed to provide scalable and energy-efficient infrastructure solutions for hyperscale and enterprise facilities deploying advanced artificial intelligence computing.
• In September 2024, Munters and ZutaCore formed a strategic alliance to advance data center cooling capabilities for high-density AI workloads. The collaboration integrated Munters' SyCool split systems with ZutaCore’s waterless, two-phase direct-to-chip liquid cooling technology. This joint solution was designed to efficiently manage the intense heat generated by AI accelerators while eliminating the risk of water leakage within the server environment. The President of Data Center Technologies at Munters stated that the partnership offered a unique end-to-end cooling approach, optimizing energy efficiency and sustainability for data center operators facing increasing thermal demands.

Key Market Players

• Schneider Electric SE
• Vertiv Co.
• Rittal GmbH & Co. KG
• STULZ GmbH
• Airedale International Air Conditioning Ltd
• Mitsubishi Electric Corporation
• Johnson Controls International plc
• Asetek A/S
• Black Box Corporation
• Nortek Air Solutions, LLC

By Product	By Data Center Type	By Cooling Technique	By Region
Air Conditioners Precision Air Conditioners Liquid Cooling Air Handling Unit Others	Large Scale Medium Scale Small Scale	Room-based Cooling Rack-based Cooling Row-based Cooling	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Data Center Cooling Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Data Center Cooling Market, By Product:

• Air Conditioners
• Precision Air Conditioners
• Liquid Cooling
• Air Handling Unit
• Others

• Data Center Cooling Market, By Data Center Type:

• Large Scale
• Medium Scale
• Small Scale

• Data Center Cooling Market, By Cooling Technique:

• Room-based Cooling
• Rack-based Cooling
• Row-based Cooling

• Data Center Cooling Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE