Data Center Liquid Cooling Market Size, Share & Trends Analysis Report By Component, By Solution, By Service, By Type Of Cooling (Immersion Cooling, Cold Plate Cooling, Spray Liquid Cooling), By Data Center Type, By End-use, By Region, And Segment Forecasts, 2025 - 2030

Data Center Liquid Cooling Market Summary

As the volume of data generated globally grows, so does the need for advanced cooling systems to manage the heat generated by densely packed server racks. Traditional air cooling systems are reaching their limitations in terms of efficiency, leading many data centers to adopt liquid cooling solutions. Liquid cooling systems are known for their superior efficiency, as liquids can absorb and transfer heat more effectively than air, allowing for better heat dissipation and reduced energy consumption.

Another key factor is the increasing use of high-performance computing (HPC) applications and artificial intelligence (AI). These applications require high computational power, which in turn generates considerable heat. Liquid cooling systems are essential for maintaining the performance and reliability of such systems, making them an attractive option for data centers that host HPC workloads, machine learning models, and AI-driven applications. The growing demand for AI, machine learning, and data analytics in industries such as healthcare, automotive, and finance is fueling the need for high-density server environments that rely heavily on advanced cooling methods.

Moreover, sustainability initiatives are contributing to the data center liquid cooling industry. With increased awareness of the environmental impact of energy consumption, companies are seeking ways to reduce their carbon footprints. Liquid cooling, due to its energy efficiency, helps in lowering power consumption compared to traditional air cooling systems, contributing to more sustainable operations in data centers. This shift aligns with the broader trend of adopting green technologies in various industries, especially in regions with stringent environmental regulations.

For instance, in May 2023, the U.S. Department of Energy (DOE) announced USD 40 million in funding for 15 projects aimed at developing high-performance, energy-efficient cooling solutions for data centers. Data centers, which house computers, storage systems, and computing infrastructure, currently account for around 2% of total U.S. electricity consumption. Cooling systems alone can represent up to 40% of the total energy usage in these facilities. This funding is designed to help reduce energy consumption and enhance the sustainability of data centers.

The advancement of liquid cooling technologies, including immersion cooling and direct-to-chip cooling, is also driving the market. These innovations are designed to optimize heat transfer while minimizing the space requirements and maintenance costs associated with traditional cooling methods. As these technologies become more cost-effective and scalable, more data centers are adopting liquid cooling solutions to meet the evolving demands of high-performance workloads.

Component Insights

The solution segment dominated the market and accounted for a revenue share of 60.0% in 2024, driven by technological, environmental, and economic factors. One of the primary drivers is the rapid rise in high-performance computing (HPC) and artificial intelligence (AI) workloads, which generate significantly more heat than traditional data center operations. As businesses increasingly adopt AI, machine learning, and big data analytics, the need for advanced cooling solutions, particularly liquid-based systems that can more effectively handle dense, high-heat environments, becomes essential.

The service segment is anticipated to grow at a CAGR of 23.0% during the forecast period due to the increasing complexity of liquid cooling systems, which require specialized expertise for installation, maintenance, and optimization. Unlike traditional air-cooling systems, liquid cooling involves advanced technologies such as direct-to-chip liquid cooling, immersion cooling, and rear-door heat exchangers.

Solution Insights

The direct liquid cooling segment dominated the market and accounted for a revenue share of over 68.0% in 2024, driven by the growing demand for thermal efficiency in high-density computing environments. With the rapid advancement of AI, machine learning, big data analytics, and blockchain technologies, servers are becoming increasingly powerful and heat-intensive. DLC solutions, which involve cooling the processor and other components directly with a liquid coolant, offer a far superior heat removal capability compared to traditional air cooling.

The indirect liquid cooling segment is expected to grow at a significant CAGR over the forecast period, driven by its ability to offer a balanced, lower-risk pathway for data centers transitioning away from traditional air cooling. In indirect liquid cooling systems, liquid is used to absorb heat at the rack or row level, typically through rear-door heat exchangers or in-row cooling units, but it doesn't directly contact electronic components. This method allows data centers to achieve significant improvements in thermal management without requiring major redesigns of existing server architecture, making it highly attractive for operators seeking incremental upgrades rather than full system overhauls.

Service Insights

The installation and deployment segment dominated the market and accounted for a revenue share of over 46.0% in 2024. Many existing data centers, built for air cooling, now need to transition to more efficient cooling methods to handle high-density computing loads driven by AI, big data, and cloud applications. Retrofitting a live data center with liquid cooling is a complex process that requires careful planning, minimal disruption to ongoing operations, and thorough testing post-installation. Specialized installation and deployment services are critical to managing these retrofits, driving growth as companies seek partners with proven expertise in both old and new cooling environments.

The maintenance and support segment is expected to grow at a significant CAGR over the forecast period. Modern liquid cooling systems are being equipped with IoT sensors and smart monitoring tools that collect real-time data on coolant flow rates, temperatures, pressures, and system integrity. Maintenance and support services are evolving to include predictive analytics that can anticipate failures before they occur. This proactive approach minimizes unexpected disruptions, extends the lifespan of cooling infrastructure, and helps data center operators optimize total cost of ownership.

Type Of Cooling Insights

The cold plate cooling segment dominated the market and accounted for a revenue share of over 48.0% in 2024. Traditional air cooling solutions face physical limitations when trying to cool increasingly dense server environments. Cold plate cooling enables operators to pack more compute power into the same or smaller physical footprint, maximizing the return on investment for expensive data center real estate. This trend is particularly important as companies strive to scale their digital operations while keeping infrastructure expansion costs under control.

The immersion cooling segment is expected to grow at a significant CAGR over the forecast period. Innovations in dielectric fluid chemistry and tank design have improved the reliability, safety, and cost-effectiveness of immersion cooling systems. Advances in single-phase and two-phase immersion techniques now offer tailored solutions for different performance and maintenance needs. This, combined with growing support from OEMs and hardware vendors, is reducing integration barriers and accelerating mainstream adoption.

Data Center Type Insights

The hyperscale data centers segment dominated the market and accounted for a revenue share of over 36.0% in 2024, driven by the surging computational demands of cloud services, artificial intelligence (AI), big data analytics, and high-performance computing (HPC). Hyperscalers such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud, and Meta-are continuously expanding their global infrastructure to support these workloads, many of which generate intense heat loads that traditional air cooling systems can no longer efficiently manage. Liquid cooling offers a scalable, energy-efficient alternative that supports higher rack densities and improves performance while reducing power consumption.

The edge data centers segment is expected to grow at a significant CAGR over the forecast period, due to the need for compact, high-performance, and energy-efficient cooling solutions in decentralized IT environments. Unlike traditional centralized data centers, edge data centers are located closer to end-users to reduce latency and support real-time applications such as autonomous vehicles, industrial IoT, augmented/virtual reality (AR/VR), and smart city infrastructure. These sites often operate in space- and power-constrained environments, making traditional air cooling both inefficient and impractical. Liquid cooling-particularly compact solutions like cold plates and immersion tanks-enables edge facilities to maintain optimal thermal conditions even under high-performance loads.

End-use Insights

The IT segment dominated the market and accounted for a revenue share of over 25.0% in 2024. The growing size and complexity of IT workloads are another critical factor. With the advent of big data, cloud computing, and AI/ML applications, IT workloads have become more computationally demanding and heat-intensive. High-density server configurations, which support these workloads, often generate much more heat than traditional data center designs can handle. Liquid cooling provides a more scalable solution by efficiently cooling individual components (e.g., processors, GPUs) or entire systems, enabling organizations to continue scaling up their IT infrastructure without being constrained by cooling limitations.

The healthcare segment is expected to grow at a significant CAGR over the forecast period, driven by the growing reliance on digital health technologies, data-driven medical research, and the increasing need for secure, high-performance computing in healthcare operations. The healthcare sector is embracing technologies like electronic health records (EHRs), telemedicine, AI-driven diagnostics, and advanced imaging, which require vast amounts of data processing and storage. As these systems generate large volumes of data, data centers in healthcare facilities must support high-performance computing while maintaining strict reliability and uptime standards.

Regional Insights

North America data center liquid cooling market held a significant share of nearly 39.0% in 2024, driven by the region’s rapid technological advancements and the increasing adoption of high-performance computing (HPC) and artificial intelligence (AI) workloads. As demand for cloud services and data analytics continues to rise, data centers are opting for more energy-efficient solutions to address power consumption concerns and manage heat generation effectively.

U.S. Data Center Liquid Cooling Market Trends

The data center liquid cooling market in the U.S. is expected to grow significantly at a CAGR of 21.6% from 2025 to 2030, owing to the expansion of hyperscale data centers and the increasing requirements for high-density computing. These facilities, which support massive data workloads from industries such as AI, machine learning, and big data analytics, require efficient cooling systems to prevent overheating and ensure operational reliability.

Europe Data Center Liquid Cooling Market Trends

The data center liquid cooling market in Europe is anticipated to register considerable growth from 2025 to 2030. Europe's data center liquid cooling market is largely influenced by strict environmental regulations and the region's commitment to sustainability. With the European Union's Green Deal and its target for achieving carbon neutrality by 2050, data centers in the region are under pressure to adopt energy-efficient technologies. Liquid cooling solutions are considered highly effective in reducing energy usage and lowering emissions, making them a preferred choice for data center operators.

The UK data center liquid cooling market is expected to grow rapidly in the coming years due to the country's focus on reducing its carbon emissions and meeting climate change goals. The increasing demand for data services, coupled with the need for more sustainable operations, is pushing UK-based data centers to implement advanced cooling technologies.

The data center liquid cooling market in Germany held a substantial market share in 2024, driven by the country's strong emphasis on energy efficiency and environmental sustainability. As a leader in green technologies and renewable energy, Germany's data centers are increasingly adopting liquid cooling systems to meet their sustainability targets. With the growing need for high-density computing due to the rise of digitalization, AI, and IoT applications, liquid cooling offers an effective solution for managing heat while reducing energy consumption.

Asia Pacific Data Center Liquid Cooling Market Trends

The data center liquid cooling market in Asia Pacific is expected to register the fastest CAGR of 22.6% from 2025 to 2030, fueled by the rapid expansion of digital infrastructure and the rising demand for cloud services. Countries like India, Singapore, and South Korea are witnessing a surge in data center development, driven by the increasing reliance on data for industries such as e-commerce, banking, and telecommunications.

Japan data center liquid cooling market is expected to grow rapidly in the coming years. The country is investing heavily in AI, IoT, and cloud computing, all of which require high-performance data centers capable of managing large-scale computational workloads. With Japan’s high energy costs and environmental concerns, liquid cooling offers a viable solution to reduce energy consumption while maintaining the reliability of data center operations.

The data center liquid cooling market in China held a substantial market share in 2024, due to the country’s massive push toward digital transformation and its burgeoning cloud computing sector. The Chinese government’s policies, including the Made in China 2025 initiative and its focus on innovation in AI and big data, are driving the growth of high-performance data centers.

Key Data Center Liquid Cooling Companies Insights

Key players operating in the data center liquid cooling market are undertaking various initiatives to strengthen their presence and increase the reach of their products and services. Strategies such as expansion activities and partnerships are key in propelling the market growth.

Recent Developments

• In April 2025, Fujitsu partnered with Super Micro Computer, Inc., a U.S.-based producer of high-performance servers, and Nidec Corporation, a Japanese manufacturer of electric motors, to improve data center energy efficiency. This partnership aims to combine Fujitsu's liquid-cooling monitoring and control software with Super Micro Computer, Inc.’s GPU servers for high performance and Nidec Corporation’s high-efficiency liquid-cooling systems. The goal is to develop a service that enhances power usage effectiveness for data centers, enabling more efficient energy consumption without compromising performance.

• In December 2024, COOLIT SYSTEMS introduced the CHx1000, a liquid-to-liquid coolant distribution unit (CDU) specifically designed for cooling advanced liquid-cooled AI and high-performance computing (HPC) servers. The CHx1000 meets the stringent cooling requirements of AI racks while fitting seamlessly within the aisles of liquid-cooled data centers. With exceptional performance, the CHx1000 is compact enough to occupy a single-rack footprint, making it easy to install within a standard data center rack layout and position directly beside the server racks.

• In November 2024, Schneider Electric agreed to acquire a majority stake in Motivair Corporation, a U.S.-based company specializing in advanced thermal management and liquid cooling solutions for high-performance computing systems. This acquisition aims to enhance Schneider Electric's presence in the growing market for energy-efficient cooling technologies in data centers and high-performance computing environments.

Data Center Liquid Cooling Market Report Scope

Global Data Center Liquid Cooling Market Report Segmentation

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For this study, Grand View Research has segmented the global data center liquid cooling market report based on component, solution, service, type of cooling, data center type, end-use, and region.

• Component Outlook (Revenue, USD Billion, 2018 - 2030)

  • Solution

  • Service

• Solution Outlook (Revenue, USD Billion, 2018 - 2030)

  • Direct Liquid Cooling

  • Indirect Liquid Cooling

• Service Outlook (Revenue, USD Billion, 2018 - 2030)

  • Design and Consulting

  • Installation and Deployment

  • Maintenance and Support

• Type of Cooling Outlook (Revenue, USD Billion, 2018 - 2030)

  • Immersion Cooling

  • Cold Plate Cooling

  • Spray Liquid Cooling

• Data Center Type Outlook (Revenue, USD Billion, 2018 - 2030)

  • Hyperscale Data Centers

  • Enterprise Data Centers

  • Colocation Data Centers

  • Edge Data Centers

  • High-Performance Computing (HPC) Data Centers

• End Use Outlook (Revenue, USD Billion, 2018 - 2030)

  • IT

  • Telecom

  • Healthcare

  • BFSI

  • Retail & E-commerce

  • Entertainment & Media

  • Energy

  • Others

• Regional Outlook (Revenue, USD Billion, 2018 - 2030)

  • North America

    • U.S.

    • Canada

    • Mexico

  • Europe

    • UK

    • Germany

    • France

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

    • Australia

  • Latin America

    • Brazil

  • Middle East & Africa

    • UAE

    • Saudi Arabia

    • South Africa