Data Center Cooling System Market - Global Industry Size, Share, Trends, Opportunity, and Forecast, 2021-2031

The Global Data Center Cooling System Market is projected to expand from a valuation of USD 17.03 Billion in 2025 to USD 36.43 Billion by 2031, reflecting a CAGR of 13.51%. This market encompasses specialized infrastructure designed for thermal management, ranging from precision air conditioning units to liquid immersion systems, which are essential for regulating humidity and temperature for critical IT hardware. The primary forces driving this industry are the explosive growth in data generation and the escalating computational requirements of artificial intelligence, which are pushing rack power densities to unprecedented levels. Consequently, enhanced cooling capabilities are required to avert hardware malfunctions and guarantee business continuity, serving as the main catalysts for investment in the sector.

One major hurdle slowing market growth is the complexity of modernizing older facilities to satisfy contemporary thermal loads and efficiency standards without incurring prohibitive capital costs. This infrastructure gap acts as a significant operational barrier for many enterprises attempting to scale their operations. According to an AFCOM report from 2024, 38% of data center professionals indicated that their existing cooling solutions were insufficient for their changing facility requirements. This statistic underscores the ongoing struggle operators face in aligning increasing performance expectations with the limitations of their current thermal management systems.

Market Drivers

The surge in power densities resulting from high-performance computing and artificial intelligence is fundamentally altering the landscape of thermal management. As operators implement clusters of high-density Graphics Processing Units to support generative AI workloads, the heat generated per rack has escalated beyond the cooling capacity of traditional air-based systems. This increase in thermal output mandates the adoption of specialized infrastructure capable of handling extreme localized heat loads to ensure hardware reliability. In its June 2024 report 'AI Disruption: Challenges and Opportunities for Data Center Operators,' Schneider Electric notes that the swift adoption of AI accelerators is pushing rack power densities to 100 kilowatts in specialized zones, necessitating a radical change in cooling architecture.

To address these density challenges and the imperative for energy efficiency, there is an accelerated transition toward advanced liquid and immersion cooling technologies. Data centers are increasingly utilizing direct-to-chip or immersion methods, which offer significantly lower Power Usage Effectiveness ratios compared to conventional air cooling. In a June 2024 press release titled 'Supermicro Expands Silicon Valley Manufacturing Campus,' Supermicro projects that liquid cooling solutions will be utilized in up to 30% of new data center deployments in the near future. This technological shift is critical given that the International Energy Agency's 'Electricity 2024' report from January 2024 predicts that global electricity usage by the AI and data center sectors could potentially double to 1,000 terawatt-hours by 2026.

Market Challenges

The primary obstacle hampering the Global Data Center Cooling System Market is the logistical and financial burden associated with retrofitting legacy facilities to accommodate modern thermal loads. Older data centers were typically constructed with infrastructure specifications intended for lower rack densities, rendering the structural integration of high-performance cooling systems difficult. This incompatibility creates a bottleneck, compelling operators to delay necessary upgrades to avoid the risks of prolonged downtime and the substantial capital investment required to overhaul active environments. Consequently, the adoption of advanced cooling units faces deceleration as enterprises struggle to justify the heavy expenditure needed to modernize aging operational footprints.

Recent industry data substantiates this resistance to infrastructure investment by highlighting the barriers to technology implementation. According to AFCOM in 2025, 47% of data center operators cited integration complexity as a primary obstacle to adopting advanced liquid cooling solutions, while 41% noted significant concerns regarding the associated costs. These statistics demonstrate that market growth is restricted not by a lack of demand for thermal management, but by the practical and economic hurdles involved in modifying established facilities to support these critical systems.

Market Trends

The implementation of waste heat recovery and reuse systems is rapidly emerging as a critical strategy to integrate data center infrastructure with local energy ecosystems. Instead of venting thermal byproducts into the atmosphere, operators are increasingly deploying liquid loops and heat exchangers to capture high-grade heat for industrial applications and district heating networks. This transition is driven by strict environmental regulations and the need to improve overall facility efficiency metrics beyond standard Power Usage Effectiveness (PUE) calculations. In a press release from December 2025 titled 'Equinix Named a Leader in the IDC MarketScape,' Equinix reported the export of 14.5 gigawatt-hours of residual heat from its operations in 2024, representing a 245% increase compared to the previous year, establishing heat reuse as a tangible revenue stream and sustainability lever.

Simultaneously, the standardization of higher operating temperatures for energy efficiency is reshaping cooling architecture designs. To reduce the energy intensity of mechanical chillers, manufacturers are optimizing systems to function with elevated coolant supply temperatures, which extends the hours available for free cooling and improves heat rejection efficiency. This approach aligns with modern hardware specifications that tolerate warmer thermal envelopes, allowing for significant reductions in compression energy. In an article from May 2025 titled 'Dell Technologies Fuels Enterprise AI Innovation,' Dell Technologies highlighted that its new rear door heat exchanger solutions now operate with water temperatures between 32 and 36 degrees Celsius, eliminating the reliance on energy-intensive chilled water loops for high-density deployments.

Key Players Profiled in the Data Center Cooling System Market

• Siemon Company
• Asetek, Inc.
• NTT Limited
• Schneider Electric SE
• STULZ GmbH
• Rittal GmbH & Co. KG
• Cisco Systems Inc.
• Emerson Network Power
• Fujitsu Limited
• Vertiv Group Corp.

Report Scope

In this report, the Global Data Center Cooling System Market has been segmented into the following categories:

Data Center Cooling System Market, by Cooling Strategies:

• Free Cooling
• Air Containment
• Closed Loop Cooling

Data Center Cooling System Market, by End-Use Type:

• Tier-1
• Tier-2
• Tier-3
• Tier-4

Data Center Cooling System Market, by Service:

• Installation/Deployment Services
• Maintenance Services & Monitoring Software

Data Center Cooling System Market, by End User Industry:

• Oil & Gas energy
• BFSI
• Healthcare
• Government & Defense
• IT & Telecom
• Others

Data Center Cooling System Market, by Region:

• North America
• Europe
• Asia-Pacific
• South America
• Middle East & Africa

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Data Center Cooling System Market.

Available Customization

The analyst offers customization according to your specific needs. The following customization options are available for the report:

• Detailed analysis and profiling of additional market players (up to five).

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