Nvidia(US:NVDA)2025-08-20 14:49Summary of Liquid Cooling Industry and AI Server Market Industry Overview - The liquid cooling industry is experiencing rapid growth driven by the increasing power consumption of AI chips, with NVIDIA GPUs rising from 400 watts to 1,400 watts over five years, and the DGX D200 server consuming up to 14.3 kilowatts, far exceeding traditional servers [1][2][3] - Virtus predicts that by 2029, the power of a single AI GPU cabinet will exceed 1 megawatt, with an average cabinet density surpassing 50 kilowatts, indicating a significant advantage for liquid cooling as cabinet density exceeds 20 kilowatts [1][3] Key Points and Arguments - Market Growth: The Chinese liquid cooling market is expected to reach $2.4 billion in 2024, growing 67% year-on-year, with a projected compound annual growth rate (CAGR) of 47% over the next five years, reaching $16.2 billion by 2029 [1][12] - Technology Adoption: Cold plate liquid cooling technology is expected to mature and be adopted first due to its higher efficiency compared to air cooling, while immersion cooling, although more efficient, faces challenges related to cooling media and long-term immersion [1][4] - Investment Opportunities: The current market is at a pivotal point, transitioning from traditional air cooling to liquid cooling, driven by the need for efficient heat dissipation in high-power AI servers [2][5] - Component Value: The core components of liquid cooling systems, such as cold plates and CDU, have significant value, with the GB200NZL72 system valued between $73,000 and $83,000 per cabinet [2][17] Market Dynamics - Demand Drivers: Major demand drivers include large data centers, AI chips, and telecommunications operators, which collectively account for 90% of the demand in the Chinese market [12] - Global AI Server Market: The global AI server market is projected to reach $3.1 billion in 2025 and $8.6 billion in 2026, with NVIDIA GPUs accounting for over 80% of the market share [13][14] - Capital Expenditure Trends: There is an optimistic outlook for capital expenditures in 2026, driven by the acceleration of AI business models and sustained growth in AI computing demand [7][6] Competitive Landscape - Key Players: Major players in the liquid cooling supply chain include Vertiv, Colt, and Delta, with Vertiv being a significant partner in NVIDIA's ecosystem [21][22] - Domestic Developments: Chinese companies like InnoTek and Shuguang are rapidly developing liquid cooling technologies and entering global supply chains, with InnoTek recognized in NVIDIA's partner network [23][24] Investment Considerations - Focus Areas: Investors should consider companies capable of entering overseas supply chains, particularly those recognized by NVIDIA, as well as domestic firms involved in AI chip development and high-density solutions [25] - Market Trends: The increasing power levels of AI chips are driving the need for advanced cooling solutions, making this an opportune time to explore various liquid cooling technologies [26][27] Conclusion - The liquid cooling market is poised for significant growth, driven by the rising power demands of AI technologies and the transition from traditional cooling methods. Investors should closely monitor developments in this sector and consider the implications of technological advancements and market dynamics on potential investment opportunities.