DELRAY BEACH, Fla., Aug. 6, 2026 /PRNewswire/ — According to MarketsandMarkets™, the Data Center Thermal Management Market is projected to grow from USD 13.24 billion in 2026 to USD 32.38 billion by 2032, at a CAGR of 16.1% during the forecast period. Key drivers of the data center thermal management market are rising rack power densities, growing adoption of liquid cooling technologies in data centers, expansion of hyperscale and AI data centers, and growing demand for energy-efficient cooling solutions.
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Data Center Thermal Management Market Size & Forecast:
Market Size Available for Years: 2021-20322026 Market Size: USD 13.24 billion2032 Projected Market Size: USD 32.38 billionCAGR (2026-2032): 16.1%
Data Center Thermal Management Market Trends & Insights:
Data center thermal management encompasses a variety of technologies, equipment, and services designed to maintain a stable temperature and effectively expel heat from data center environments. There are numerous air-based cooling solutions, such as Computer Room Air Conditioners (CRACs), Computer Room Air Handlers (CRAHs), precision cooling systems, chillers, cooling towers, and various airflow management systems. Additionally, there are more advanced liquid cooling methods, including direct-to-chip cooling, immersion cooling, rear-door heat exchangers, coolant distribution units, and heat exchangers, along with pumps and manifolds that form a network for liquid distribution. Recently, as AI-enabled data centers have led to higher rack densities, there has been a notable shift from traditional air-cooling systems toward liquid cooling solutions. This change is primarily because liquid cooling provides superior heat transfer efficiency and better accommodates high-density computing setups, reducing the challenges associated with conventional air cooling.North America is the fastest-growing region, in terms of value, with a CAGR of 18.6% during the forecast period.Liquid cooling systems accounted for the largest share of 30.4% in terms of value in 2025.Room-based cooling is expected to lead the data center thermal management market during the forecast period.Hyperscale data centers are the largest segment of the data center thermal management market, accounting for 44.2% of the market by value in 2025.BFSI is the largest segment, in terms of value; it is estimated to have accounted for 20.4% in 2025.Vertiv Group Corp., Johnson Controls, and Schneider Electric were identified as key players in the data center thermal management market, given their strong market share and product footprint.CoolCentric and Iceotope Precision Liquid Cooling are among the startups and SMEs securing a strong foothold in specialized niche areas, underscoring their potential as emerging market leaders.
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By component, the liquid cooling systems are expected to dominate the global market throughout the forecast period.
The liquid cooling systems segment is projected to lead the global data center thermal management industry during the forecast period. This growth is largely driven by the rapid increase in workloads related to artificial intelligence (AI), high-performance computing (HPC), and cloud computing, which require significantly higher cooling capacities than traditional air-based solutions can provide. Modern processors and AI accelerators generate more heat than earlier technologies, making liquid cooling technologies such as direct-to-chip, immersion cooling, and liquid-to-liquid cooling systems essential for maintaining optimal operating temperatures, enhancing server performance, and ensuring long-term equipment reliability. These systems offer superior heat transfer capabilities, enabling efficient cooling for high-density racks and aligning with next-generation computing infrastructure.
Additionally, the widespread growth of hyperscale and colocation data centers is further strengthening the market for liquid cooling. Major cloud providers like Amazon Web Services (AWS), Microsoft, Google, Meta, and Oracle are increasingly developing AI-ready facilities where rack power densities often exceed 50–100 kW. In these scenarios, traditional air cooling proves to be ineffective. Liquid cooling solutions not only facilitate the proper operation of these high-density setups but also reduce cooling energy consumption, improve Power Usage Effectiveness (PUE), and allow operators to increase server utilization. Consequently, many operators are incorporating liquid cooling into new data center builds and upgrading existing sites to meet the rising demands of computational workloads.
By data center type, hyperscale data centers are expected to lead the global data center thermal management market during the forecast period.
The hyperscale data center segment is expected to lead the global data center thermal management market during the forecast period. This growth is primarily driven by the rapid expansion of hyperscale cloud infrastructure, alongside increasing demands from artificial intelligence workloads, high-performance computing, and extensive colocation facilities. In these large data centers, thousands of servers, storage systems, networking equipment, and various AI accelerators operate continuously, which leads to significant heat buildup. Therefore, there is a critical need for highly efficient thermal management systems to maintain consistent performance and reliability.
As enterprises and cloud providers continue to shift more workloads to larger facilities, spending on advanced cooling infrastructure is markedly increasing. To manage high-density computing environments, operators are implementing comprehensive thermal management solutions such as direct-to-chip liquid cooling, immersion cooling, computer room air conditioners (CRACs), computer room air handlers (CRAHs), coolant distribution units (CDUs), precision cooling systems, chillers, heat exchangers, cooling towers, smarter airflow management systems, and AI-powered thermal monitoring platforms. These technologies effectively remove heat, enhance cooling efficiency, reduce energy consumption, and support rack power densities exceeding 100 kW. Consequently, such solutions are becoming essential for next-generation AI-ready data centers.
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By technology, liquid cooling is expected to lead the global data center thermal management market during the forecast period.
Liquid cooling segment is expected to dominate the global data center thermal management market during the forecast period, mainly because more people are using AI, high performance computing, cloud computing, and edge computing, all of which need a lot more cooling capability than air cooling can reasonably deliver. With the fast rollout of power-hungry processors, GPUs, and AI accelerators, rack power densities are climbing quite a bit, so liquid cooling becomes the go-to approach for getting rid of heat effectively while keeping server performance stable and reliability in check. Compared with air cooling, liquid solutions can move heat better, which helps computing density upward with less energy waste.
Also, the continual expansion of hyperscale and colocation data centers is quietly but steadily reinforcing this lead. Big cloud players like Amazon Web Services (AWS), Microsoft, Google, Meta, and Oracle are putting serious money into AI-ready campuses that use high density server racks, and in many cases those racks go beyond 50–100 kW per rack. To handle these advanced setups, liquid cooling methods such as direct-to-chip cooling, immersion cooling, and rear-door heat exchangers deliver the cooling performance needed, while also cutting the power spent on cooling tasks and helping improve Power Usage Effectiveness (PUE). So, liquid cooling is both in new greenfield builds and in retrofit projects, where older facilities are upgraded to keep pace with newer workloads.
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The North America region is poised to lead the global data center thermal management market throughout the forecast period.
North America is expected to lead the global data center thermal management market during the forecast period due to several factors. The region has a well-established digital infrastructure, a high concentration of hyperscale data centers, and rapidly increasing investments in artificial intelligence (AI), cloud computing, and high-performance computing (HPC). Major cloud service providers, along with tech giants such as Amazon Web Services (AWS), Microsoft, Google, Meta, Oracle, and CoreWeave, are based here. These companies are continually expanding their AI-ready data center capacity to meet the growing demand for computational workloads.
As GPU-heavy AI clusters and high-density server racks become more common, the need for effective cooling solutions has significantly increased. Consequently, there is a steady demand for advanced thermal management solutions. North America is also an early adopter of next-generation cooling technologies, such as direct-to-chip liquid cooling, immersion cooling, precision cooling systems, computer room air conditioners (CRACs), computer room air handlers (CRAHs), coolant distribution units (CDUs), heat exchangers, smarter airflow management systems, and AI-enabled thermal monitoring platforms.
These innovative approaches help operators manage high heat loads more effectively, enhance overall reliability, reduce energy consumption, and improve Power Usage Effectiveness (PUE). Overall, these thermal management solutions are essential for today’s AI and cloud data centers, especially where efficiency and control are crucial.
Key Players
Some of the leading players in data center thermal management companies include Vertiv Group Corp (US), Johnson Controls, Inc. (US), Schneider Electric (France), Carrier (US), and Daikin Industries Ltd. (Japan), among others.
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