Data Center Cooling Market Size (2024 - 2029)

Data Center Cooling Market Analysis

The Data Center Cooling Market size is estimated at USD 16.56 billion in 2024, and is expected to reach USD 34.51 billion by 2029, growing at a CAGR of 15.82% during the forecast period (2024-2029).

Due to the high computational needs of AI and media applications, data centers are being increasingly deployed worldwide. These data centers consume a massive amount of power, generating a significant amount of heat, further creating the need for various efficient cooling systems.

• The data center cooling market is expected to show substantial growth due to the increase in digitization worldwide, which will lead to greater computer performance and require a larger number of integrated small chips. The design of data centers and the need to cool them are mainly influenced by powerful computer hardware for AI workloads. Manufacturers are introducing large silicon chips to optimize the performance of artificial intelligence and high-performance computing workloads. The use of powerful GPUs in artificial intelligence and high-performance computing environments supports the need for data center cooling technologies.
• The increasing use of OTT and streaming services has led to a growth in data, fostering market development. Also, the increasing data from online streaming services such as Disney+ Hotstar, Hulu, and Netflix is expected to drive the demand for data center cooling systems.
• Market players are taking action to augment their consumer base by focusing on expanding their global footprint and service offerings. For instance, in March 2024, the intelligent power management company Eaton declared the North American launch of an innovative new modular data center solution for organizations that are seeking to rapidly fulfill the increasing requirements for machine learning, edge computing, and AI. Eaton's SmartRack modular data centers primarily combine IT racks, cooling, and service enclosures to build a performance-optimized data center solution for critical IT equipment with up to 150 kW of equipment load.
• The market's growth is expected to be hampered by the rising need for various adaptability requirements and power shortages worldwide. Also, factors like the use of inefficient cooling system designs, such as outdated infrastructure or poorly optimized layouts, leading to energy inefficiencies and increased operational costs, and rising energy prices, which might make the cooling expenses prohibitive, are some of the factors that can restrain the market growth during the forecast period.
• The COVID-19 pandemic negatively influenced a cooling market for data centers. However, in the post-COVID-19 period, the use of cloud services increased significantly, leading to the generation of massive amounts of data. This, in turn, is expected to drive the market's growth opportunities.

Data Center Cooling Industry Segmentation

Data center cooling refers to the collective equipment, tools, techniques, and processes that ensure an ideal operating temperature within a data center facility. With increasing capacity and higher density, there is an increasing need for energy-efficient cooling of IT equipment. Furthermore, benefits offered by the technology and support from the government by imposing efficiency regulations on data centers are expected to boost the growth of the data center cooling market directly in various fields such as IT, BFSI, Telecommunication, etc.

The global data center cooling market is segmented by cooling technology (air-based cooling (CRAH, chiller and economizer, cooling tower (direct, indirect, and two-stage cooling), and others)) and liquid-based cooling (immersion cooling, direct-to-chip cooling, and rear-door heat exchanger)), end-user vertical (IT & telecom, retail & consumer goods, healthcare, media & entertainment, federal & institutional agencies, and other end users), and by geography (North America, Europe, Australia and New Zealand, South America, and the Middle East and Africa) The market sizes and forecasts are provided in terms of value (USD) for all the above segments.