The global data center cooling market size was estimated at USD 18.65 billion in 2023 and is projected to experience robust growth, with a compounded annual growth rate (CAGR) of 16.8% from 2024 to 2030. This growth trajectory is primarily driven by the increasing demand for energy-efficient data centers, which presents lucrative opportunities for market expansion. Numerous key players in the industry are actively preparing for strategic expansions to meet this rising demand.

Several factors contribute to the favorable growth prospects in this sector. One of the most significant is the rapid increase in data generation, spurred by advancements in technology, digital transformation, and the proliferation of IoT devices. As organizations across various industries rely more heavily on data, the demand for data centers is surging globally. However, data centers are inherently power-intensive facilities that generate considerable heat as a byproduct of their operations. This heat generation necessitates the implementation of efficient cooling systems to ensure optimal performance and prevent equipment overheating.

The shift toward digital transformation, particularly accelerated by the pandemic, has intensified the need for scalable, secure, and flexible data center facilities. As businesses invest more in building new data center facilities, the outlook for the data center cooling industry becomes increasingly favorable. However, the industry faces challenges, including the need for specialized infrastructure and the high costs associated with arranging and maintaining these advanced data center solutions. Additionally, cooling challenges can arise during power outages, and there is an ongoing emphasis on reducing carbon emissions, both of which pose potential hurdles to market growth.

Gather more insights about the market drivers, restrains and growth of the Data Center Cooling Market

Solution Insights

In terms of solution offerings, the air conditioners segment held the largest share of over 30.0% of the overall revenue in 2023. Air conditioning units are widely favored among end-users because they provide essential 24-hour cooling protection while also helping to reduce energy costs. During data storage and analysis—critical processes for informed decision-making—data centers often utilize heavily packed racks that generate substantial heat. Air conditioners play a vital role in maintaining optimal temperature levels, ensuring that data centers operate effectively and efficiently. Additionally, air conditioners function as heat exchangers, regulating the room temperature in sensitive IT environments where temperature fluctuations can lead to equipment failures or data loss.

Looking ahead, the precision air conditioners segment is estimated to grow at an impressive CAGR exceeding 18% from 2024 to 2030. This anticipated growth can be attributed to ongoing technological advancements and the development of energy-efficient units that align with the evolving needs of modern data centers. Precision air conditioners are designed to offer numerous advantages, including continuous operation and precise humidity control, which are critical for maintaining optimal conditions in IT environments. Furthermore, these units demonstrate superior air distribution capabilities and can automatically control individual AC loads, providing efficient cooling solutions tailored to the specific requirements of each data center.

In summary, while the global data center cooling market faces challenges, it is also poised for significant growth driven by increasing data demands, technological advancements, and a commitment to energy efficiency.

Order a free sample PDF of the Market Intelligence Study, published by Grand View Research.