Liquid Cooling Industry Enters Explosive Growth Phase Amid Surging AI Computing Demand
The liquid cooling sector has become a standout high-growth track in the capital market throughout 2026. Driven by skyrocketing AI computing power, high-power chips generate massive heat, making traditional air cooling inadequate for high-density computing scenarios. As a result, liquid cooling data center solutions have evolved into essential infrastructure for modern intelligent computing facilities, unlocking huge growth potential across the industrial chain.
The liquid cooling industry has officially moved from pilot trials to large-scale mass production, with domestic manufacturers running at full capacity. According to the China Academy of Information and Communications Technology, China’s water cooled data center market reached RMB 18.4 billion in 2024, up 66% year-on-year. Steady high growth is projected through 2029, with the market size expected to hit approximately RMB 130 billion, marking the industry’s official explosive growth inflection point.
Booming AI demand has brought saturated orders and rapid capacity expansion for industrial players. Multiple manufacturers face tight supply for supporting parts of high-performance water cooled server equipment. Since early 2026, core enterprises including Shenling Environment, Jinfu Technology and Dingtong Technology have maintained full production, with customized components for high-power liquid cooled server products in short supply. Many firms have launched new manufacturing projects and obtained NVIDIA and other top AI enterprise verification orders.
Domestic liquid cooling companies are ramping up capital investment and multi-regional layout to seize market dividends. Leading players such as Tongfei, Chuanrun and Jialitu have built dual north-south production bases and launched financing initiatives to expand precision cooling production. Their product lines cover full-spec CDU liquid cooling devices, cold plates and immersion systems, fully catering to large-scale AI cluster demands. Key upgrades include Shenling’s RMB 800 million new manufacturing base, Lingyi iTech’s 10-fold capacity expansion of liquid cooling components, and Chuanrun’s exclusive liquid cooling supply partnership with Huawei Ascend super nodes.
Cross-industry players are enriching the liquid cooling ecosystem with innovative technologies and full product coverage. Companies including Luxshare Precision and Binglun Environment have developed high-efficiency heat dissipation materials and micro-channel cooling solutions. Their high-stability server cooling liquid products are advancing toward mass production for next-gen high-power AI servers. Luxshare is building the world’s largest 3D-printed liquid cooling component factory, while Yimikang, Shuobeide and Chengtian Weiye have completed full core component layout with qualified small-batch deliveries.
Global liquid cooling competition is intensifying as international giants accelerate capacity expansion. Vertiv is investing USD 50 million to upgrade its U.S. production base for high-power CDU and cooling modules, set for operation in late 2026. AVC expands core component capacity sharply for NVIDIA GB200 supporting supply, while Cooler Master advances large-scale investment in Vietnam manufacturing bases. Together with Delta Electronics, these global leaders dominate the server liquid cooling plate market, continuously optimizing the standardized data center liquid cooling system for global deployment.
In 2026, the liquid cooling industry has completely shifted from conceptual hype to solid order and performance delivery. With the implementation of industry cooling standards and mass production of high-power AI chips, efficient AI data center liquid cooling has become an indispensable industry solution, with robust growth expected to last until 2028. In the future, production capacity scale, technical verification strength and global delivery capability will define core competitiveness, driving the high-quality upgrade of global AI data center cooling infrastructure.
Trusted globally as a liquid cooling leader, EXTRCOOL engineers custom solutions for high-density AI and HPC data centers. Our premium hardware—dual-mode CDUs, manifolds, cold plates, rear-door heat exchangers, dry coolers, and containerized units—offers reliability, seamless integration, and easy scaling for turnkey one-stop full liquid cooling. We support data center operators and enterprises across Western Europe, South America, Southeast Asia, the Middle East, and Oceania.
