Data Center Cooling Market to Reach USD 73.4 Billion by 2035, Driven by AI Workloads and Cloud Expansion

The data center cooling market has become a critical component of the global digital infrastructure ecosystem. As data centers operate around the clock to support cloud computing, artificial intelligence, big data analytics, streaming platforms, and enterprise IT operations, they generate substantial amounts of heat. Efficient cooling systems are essential to maintain optimal operating conditions, prevent equipment failure, reduce downtime, and improve energy efficiency. With the rapid growth in data traffic and computing intensity, the demand for advanced and sustainable cooling solutions is accelerating worldwide.

The global Data Center Cooling Market is witnessing strong expansion, driven by the rapid growth of cloud computing, artificial intelligence, and high-density data processing environments. The market was valued at around USD 21.2 billion in 2024 and is projected to grow at a compound annual growth rate of over 11.9% during the forecast period, reaching approximately USD 73.4 billion by 2035.

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Key Players:

• Vertiv Group Corp.
• Carrier
• Daikin
• Johnson Controls
• Siemens
• Schneider Electric
• GRC
• Dell Inc.
• FLEX LTD
• Modine
• Munters AB
• Boyd
• STULZ GMBH
• Black Box
• Delta Power Solutions
• ALFA LAVAL
• Trane Technologies

The data center cooling market has witnessed steady expansion over the past decade and continues to gain momentum due to the proliferation of hyperscale data centers, edge computing facilities, and colocation centers. Increasing server density and power usage per rack are further intensifying the need for high-performance cooling systems.

Market Size and Growth Outlook

The global data center cooling market is experiencing strong growth, driven by rising digitalization and the expansion of data center infrastructure across both developed and emerging economies. Market projections indicate robust growth through the next decade, supported by increasing investments in cloud services, artificial intelligence, and high-performance computing environments.

The market is expected to grow at a healthy double-digit compound annual growth rate over the forecast period, with liquid cooling and energy-efficient air-based systems emerging as high-growth segments. Long-term growth prospects remain favorable as data generation and processing requirements continue to rise across industries.
Key Market Drivers

Rising Demand for Cloud and Digital Services

The widespread adoption of cloud computing, remote work, online entertainment, and digital payments has significantly increased data processing and storage needs. This surge has led to rapid data center construction, directly boosting demand for reliable and efficient cooling systems.

Growth of High-Density and AI Workloads

Advanced workloads such as artificial intelligence, machine learning, and high-performance computing generate far more heat than traditional IT applications. As a result, data center operators are increasingly adopting advanced cooling technologies capable of handling high heat densities efficiently.

Energy Efficiency and Sustainability Focus

Cooling systems are among the largest consumers of energy within data centers. Growing emphasis on sustainability, carbon footprint reduction, and operational cost control is driving adoption of energy-efficient cooling technologies, including free cooling, liquid cooling, and intelligent thermal management systems.

Expansion of Edge and Modular Data Centers

The rise of edge computing has led to the deployment of smaller, distributed data centers closer to end users. These facilities require compact, scalable, and highly efficient cooling solutions, further supporting market growth.

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Market Segmentation

By Product

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

By Cooling Technique

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

By Application

• Telecom
• IT
• Retail
• Healthcare
• BFSI
• Energy
• Government & Defense
• Others

Regional Analysis

North America holds a prominent share of the data center cooling market due to the presence of hyperscale data centers, strong cloud adoption, and early implementation of advanced cooling technologies.

Europe continues to witness steady growth, driven by stringent energy efficiency regulations and a strong focus on sustainable data center operations.

Asia Pacific is expected to register the fastest growth during the forecast period, supported by rapid digital
transformation, expanding internet penetration, and large-scale investments in data center infrastructure across emerging economies.

Latin America and the Middle East & Africa are emerging markets, benefiting from increasing digitalization and government initiatives to strengthen data infrastructure.

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Key Market Trends

Adoption of Liquid and Immersion Cooling

Liquid-based cooling solutions are gaining traction due to their superior thermal efficiency and ability to support high-density computing environments. These systems help reduce energy consumption while improving overall data center performance.

AI-Driven Cooling Optimization

Artificial intelligence and machine learning are increasingly being integrated into cooling systems to optimize airflow, temperature control, and energy usage in real time,

enhancing operational efficiency.

Shift Toward Sustainable Cooling Technologies
Eco-friendly cooling approaches such as free cooling, evaporative cooling, and low-global-warming-potential refrigerants are becoming mainstream as operators prioritize environmental responsibility.

Modular and Prefabricated Cooling Systems

Prefabricated and modular cooling solutions allow faster deployment, scalability, and cost efficiency, making them attractive for both hyperscale and edge data centers.
Challenges in the Data Center Cooling Market

Despite strong growth prospects, the market faces several

challenges. High initial capital investment for advanced cooling technologies can limit adoption, particularly among small and mid-sized data center operators. Retrofitting existing facilities with new cooling systems can be complex and costly. Additionally, balancing cooling efficiency with rising energy prices and evolving regulatory standards remains a key concern for data center operators.

Future Outlook

The future of the data center cooling market looks promising, with continuous innovation focused on energy efficiency, sustainability, and performance optimization. As data centers evolve to support next-generation workloads such as artificial intelligence and edge computing, advanced cooling technologies will play a pivotal role in ensuring reliability and cost efficiency. Ongoing investments in smart and green cooling solutions are expected to shape the market's long-term trajectory.

Frequently Asked Questions (FAQs)

1. How big was the global data center cooling market in 2024?
The global data center cooling market was valued at US$ 21.2 Bn in 2024

2. How big will the global data center cooling industry be in 2035?
The global data center cooling industry is projected to reach more than US$ 73.4 Bn by the end of 2035

3. What are the factors driving the data center cooling market?
Growing need for increasing efficiency and focus on energy efficiency and sustainability are some of the factors driving the expansion of data center cooling market.

4. What will be the CAGR of the global data center cooling industry during the forecast period?
The CAGR is anticipated to be 11.9 % from 2025 to 2035

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