The global sales of immersion cooling is estimated to be worth USD 636 million in 2025 and is projected to reach a value of USD 2,379.4 million by 2035. Sales are projected to rise at a CAGR of 14.1% over the forecast period between 2025 and 2035. The revenue generated by immersion cooling in 2024 was USD 522.6 million. The industry is anticipated to exhibit a Y-o-Y growth of 21.7% in 2025.
Immersion cooling is turning out to be preferred solution for the heat management of data centers in high performance computing environments. Use of this cooling technology helps in meeting broader strategic objectives within the industry, addressing not only cooling system efficiency but also key factors such as cost optimization, environmental sustainability, and operational reliability.
In this cooling technology, the electronic equipment is flooded with a dielectric liquid that is also thermally conducting so that the heated air from the equipment is efficiently removed such that the load on air-cooling systems is reduced to greater extent. This innovation is particularly beneficial for dense server configurations and high-computing workloads, where traditional methods struggle to deliver consistent performance under thermal stress.
| Attributes | Key Insights |
|---|---|
| Estimated Size, 2025 | USD 636 million |
| Projected Size, 2035 | USD 2,379.4 million |
| Value-based CAGR (2025 to 2035) | 14.1% |
The immersion cooling industry is set to experience robust growth, driven by the increasing adoption of high-performance computing and the rising demand for sustainable and efficient cooling solutions in data centers. This market is projected to create an incremental opportunity of USD 1,743.4 million and grow 3.7X by 2035 from its current worth in 2025.
Key factors fueling this growth include the superior energy efficiency of immersion cooling, which reduces cooling energy consumption by up to 90%, significantly lowering operational costs and carbon emissions.
Another key growth driver is the financial advantage of immersion cooling. By cutting down on both capital and operational expenditure by up to 50%, the technology attracts organizations seeking to optimize their infrastructure investments.
The reduced real estate footprint and minimized maintenance costs further enhance its economic viability, making it an attractive choice for large-scale data center operations and enterprises operating in regions with high-energy costs.
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The table below presents a comparative assessment of the variation in CAGR over six months for the base year (2024) and current year (2025) for the global immersion cooling market. This analysis reveals crucial shifts in market performance and indicates revenue realization patterns, thus providing stakeholders with a better vision of the growth trajectory over the year.
The first half of the year, or H1, spans from January to June. The second half, H2, includes the months from July to December. In the first half (H1) of the semi-annual from 2025 to 2035, the business is predicted to surge at a CAGR of 11.7%, followed by a slightly higher growth rate of 12.5% in the second half (H2).
| Particular | Value CAGR |
|---|---|
| H1 2024 | 11.7% (2024 to 2034) |
| H2 2024 | 12.5% (2024 to 2034) |
| H1 2025 | 13.1% (2025 to 2035) |
| H2 2025 | 15.1% (2025 to 2035) |
Moving into the subsequent period, from H1 2025 to H2 2035, the CAGR is projected to increase slightly to 13.1% in the first half and remain relatively moderate at 15.1% in the second half. In the first half (H1) the market witnessed an increase of 140 BPS while in the second half (H2), the market witnessed an increase of 260 BPS.
Rise in usage of data generative technologies indirectly driving demand for immersion cooling technologies
The growing adoption of data-generative technologies such as artificial intelligence, the Internet of Things, cloud computing, and machine learning is driving a global increase in demand for higher data density and data center racks.
These technologies require processing of high quantities of data, needing advanced and sophisticated technologies for ensuring security of data and elevated performance levels. Due to these demanding features, data center servers face overheating issues, which is met by deployment of precise and efficient immersion cooling technology.
According to ITU data, global Internet traffic grew at an average annual rate of 22%, reaching 5,291 Exabytes in 2022 from 2,401 Exabytes in 2019. While growth rates have slowed in developed regions such as Europe (18% CAGR) and the Americas (16% CAGR), emerging regions like the Arab nations (34% CAGR) and Africa (31% CAGR) are witnessing rapid increases.
This rise is fueled by growing connectivity needs, streaming, gaming, and social networking, leading to greater reliance on cloud and hyper scale data centers, further boosting the demand for immersion cooling technologies.
Implementation of immersion cooling technologies to facilitate efficient space utilization in data centers
Increasing mobile subscription base, penetration of broadband technologies and data generation is posing challenges for the IT and Telecom industry to maintain efficient service standards and effectively manage data ensuring best-in-class security measures.
Increasing urbanization and expanding industrial base has affected real estate costs across the globe. Traditional air cooling methods incorporate chillers, air coolers that have bulky designs and require more space in data centers.
This issue by far, is addressed by utilizing immersion-cooling technologies for heat management in data centers. These technologies allow for installing greater rack capacities within same spaces in compact manner thus also supporting retrofit and infrastructure up-gradation activities.
These technologies offer promising solution for saving on capital costs while ensuring high efficiency standards particularly in metropolitan areas and technology hubs where set-up costs are high.
Immersion cooling technologies helping to meet sustainability challenges in modern data centers
High-density data centers primarily rely on efficient immersion cooling technologies for meeting elevated demands of cooling for their safe operation. These technologies not only help in effective heat dissipation but also guard the infrastructure from pollution, dust, humidity and corrosion.
In these systems, the servers are submerged in non-conductive cooling liquids thereby improving machine efficiency and reducing energy consumption. The benefits offered by this technology helps in carbon emission mitigation and saving on space utilization, thus enabling organizations to achieve sustainability goals and capitalize on carbon credit opportunities.
Technology and service industry giants like Microsoft and Alibaba have incorporated this technology into their data centers to achieve high performance and efficiency. With proven demonstration of these technologies associated with operational benefits, its adoption is expected to gain traction amongst small, medium to large-scale enterprises across the globe and further drive growth in the market.
Substantial IT infrastructure spending shaping the market for immersion cooling technologies
IT infrastructure is backbone to technological developments and operational root of all the industries. Exponential rise in social media platforms, media and entertainment industries and expansion of BFSI industry is providing growth platform for telecom and IT industry, which in turn is driving need for advanced data center solutions.
Due to the increasing use of smart phones, Internet of Things, cloud computing, and telecommunications, IT infrastructure development has experienced tremendous growth in recent years. The development of modern computing technologies has accelerated the deployment of IT infrastructure while fueling the expansion of the world economy.
For instance, in February 2024, Facebook’s parent company Meta has announced plans to invest up to USD 37 billion to boost IT infrastructure to cater for advanced requirements of artificial intelligence services.
On the similar lines, other IT giants have also similar plans to strengthen their infrastructure in the near course of time. Such steps and plans by key companies will indeed provide a push to data center infrastructure and adoption of immersion cooling technologies.
In the globally interconnected world, businesses need to work at an ever-increasing pace as the data economy grows, radically altering the services landscape and mode of delivery. These centers are extremely expensive in terms of energy use, water use and carbon footprint.
Immersion cooling fluids are used in single phase or two phase cooling techniques to provide data centers with faster, smarter, more energy-efficient, and more sustainable cooling solutions while also lowering total operating costs for manufacturers and service providers.
Tier 1 companies comprise market leaders with a market revenue of above USD 10 million capturing a significant market share of 70% to 75% in the global market. These market leaders are known for their large production capacities and diverse product offerings. They stand out due to their vast expertise in manufacturing across various packaging formats and their extensive global presence, supported by a strong and loyal customer base.
They provide a wide range of series including recycling, and manufacturing utilizing the latest technology meeting regulatory standards providing the highest quality. Prominent companies within Tier 1 include The DOW Chemical Company, 3M, FUCHS LUBRICANTS CO., Solvay, Shell Inc., Chemours.
Tier 2 and other includes the majority of small-scale companies operating at the local presence and serving niche markets having revenue below USD 10 million. These companies are notably oriented towards fulfilling local market demands and are consequently classified within the tier 2 share segment. They are small-scale players and have limited geographical reach.
Tier 2, within this context, is recognized as an unorganized market, denoting a sector characterized by a lack of extensive structure and formalization when compared to organized competitors.
Historically (2020 to 2024) the demand for immersion cooling witnessed a CAGR of around 19% between the same periods. The growth was primarily driven by technologies gaining traction including artificial intelligence, cloud computing, machine learning and other IoT driven technologies.
As the awareness and penetration of these technologies advanced across the globe the market is expected to stabilize and mature during the further assessment period. The growth trajectory is expected to lower down and stabilize with CAGR of 14.1% between 2025 and 2035.
Deployment of 5G networks and the expansion of AI-powered applications will push need for data processing requirements to elevated levels, thus, amplifying the need for immersion cooling. Sustainability goals, stringent energy efficiency regulations, and the rising costs of energy will also play key role in promoting the use of energy-saving immersion cooling technologies.
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The following section presents an industry analysis of the immersion cooling market across various countries. It includes a market demand analysis for key countries in regions such as North America, Asia Pacific, Western Europe, and others. The USA is expected to maintain a dominant position in North America, holding a value share of 89.2% through 2035. In East Asia, China is projected to experience a compound annual growth rate (CAGR) of 16% by 2035.
| Countries | Value CAGR (2025 to 2035) |
|---|---|
| USA | 13.3% |
| UK | 13.9% |
| France | 14.7% |
| Germany | 15.5% |
| China | 16.0% |
| Japan | 14.3% |
The UK immersion cooling market is projected to experience significant growth, with an impressive compound annual growth rate (CAGR) of 13.9% from 2025 to 2035. By the end of the forecast period, the market is expected to reach a value of over USD 208.2 million. This growth is primarily driven by the increasing number of data centers in the UK, which currently operates 514 facilities, making it one of the leading data center hubs in Western Europe.
UK is home to several high-performance computing (HPC) systems, with 12 systems ranked in the Top 500 global HPC survey in 2021. While this accounts for only about 2.4% of the total systems worldwide, these HPC systems are crucial in supporting advanced research across various domains, requiring exceptionally high processing power and, consequently, enhanced cooling capabilities.
The role of government in UK is also providing growth avenues for the domestic IT industry. In October 2024, the government pledged GBP 6.3 billion investment to enhance datacenter facilities in the country in order to respond to developments in AI industry landscape.
USA, is currently estimated to hold about 35.9% of the global immersion cooling market in 2025 and is expected to grow at an impressive CAGR of 13.3% during the forecast period. By the year 2035, even USA market alone is expected to be valued at a staggering USD 793.2 million.
Awareness regarding crypto currency in USA is quite high when compared with other countries of the world. In January 2024, USA Securities and Exchange Commission approved 11 bitcoin exchange-traded fund applications. Cryptocurrency mining for digital currencies require enormous amount of computing capabilities and as these activities scale up, requirement for efficient data-centers is also expected to increase at rapid scale.
The USA is home to 137 commercial-scale cryptocurrency mining facilities spread across 21 states, with a notable concentration in Texas, Georgia, and New York. These facilities require substantial power and highly efficient cooling systems to support the intensive computational workloads involved in mining.
As a result, immersion cooling presents a promising solution to reduce energy consumption and prevent hardware overheating. The expansion of cryptocurrency mining clusters, along with the increasing number of data centers, indicates that the demand for immersion cooling technologies is set to grow significantly in the coming years.
China continues to strengthen its position in the immersion cooling market, projected to account for approximately 48.1% of the East Asia market in 2025. This growth is fueled by China's expanding data center industry, which currently includes 362 data centers supported by 13 major data center providers.
As demand for data processing and storage grows, immersion cooling becomes essential due to its efficiency in handling high-density computing. There is an increasing trend of adoption of immersion-cooling technology by the data centers in China to reduce operational costs, enhance cooling efficiency and improve sustainability, all of which are desirable in data processing environments.
China is investing heavily in development of domestically designed architecture and supercomputing centers. In December 2023, China inaugurated its supercomputing facility in Guangdong province.
Following a similar trend it is likely that new facilities will come up to aid to the country’s digital infrastructure, as this industry develops, and with the projection that by 2026 China will host about 26% of edge sites worldwide, the need for energy-efficient immersion cooling solutions increases.
The section contains information about the leading segments in the industry. By Type, the single-phase immersion cooling segment is estimated to grow at a CAGR of 13.1% throughout 2035. Additionally, high-performance computing is projected to expand at 14.7% by 2035.
| Type | Single-Phase Immersion Cooling |
|---|---|
| Value Share (2035) | 76.5% |
The single-phase immersion cooling market is expected to increase at a CAGR of 13.1% between 2025 and 2035, with a market value expected to surpass USD 1,286.8 million by the end of forecast period. This rise is mostly due to the increased demand for effective heat management systems in data centers and high-performance computer environments.
Single-phase immersion cooling, in which equipment is submerged in dielectric fluids that enables heat transfer from critical components, is gaining popularity due to its simple construction and lower maintenance requirements compared to two-phase systems.
Companies like Engineered Fluids and Submer have shown that single-phase cooling solutions, which do not rely on phase-change fluids, offer a reliable option for operators aiming to reduce energy consumption and minimize equipment wear.
| Application | High-Performance Computing |
|---|---|
| Value Share (2035) | 29.4% |
The immersion cooling market for high-performance computing (HPC) is projected to exceed USD 823.7 million by 2035, driven by a CAGR of 14.7%. This growth aligns with the increasing demands in data-intensive industries, where HPC applications require efficient cooling solutions to sustain operations.
As computing needs become more complex across sectors like artificial intelligence, genomics, financial modeling, and energy simulations, the limitations of traditional cooling methods make immersion cooling a viable and essential alternative.
This market expansion will also benefit from broader adoption trends in HPC applications as organizations seek solutions that reduce carbon emissions and operational costs. With immersion cooling systems reducing the need for air cooling infrastructure, they allow for denser data center configurations without thermal risk.
The section provides comprehensive assessments and insights that highlight current opportunities and emerging trends for companies in developed and developing countries. It analyzes advancements in manufacturing and identifies the latest trends poised to drive new applications in the market.
The key players in the absorption chiller market are actively enhancing their market presence and competitiveness through different strategies by incorporating advanced technologies like variable-speed compressors, intelligent controls, and integration with renewable energy sources to improve energy efficiency and environmental sustainability.
Significant players are further introducing new products to address the increasing need for cutting-edge solutions in various end-use sectors. Geographic expansion is another important strategy that is being embraced by reputed companies. Start-ups are likely to emerge in the sector through 2035, thereby making it more competitive.
Recent Industry Developments in the Immersion Cooling Market:
In terms of type, the industry is divided into single-phase immersion cooling and two-phase immersion cooling
In terms of operating pressure, the industry is divided into high-performance computing, artificial intelligence, edge computing, cryptocurrency mining and others.
Key regions include North America, Latin America, Western Europe, Eastern Europe, East Asia, South Asia & Pacific, and Middle East & Africa.
The global immersion cooling industry is projected to witness a CAGR of 14.1% between 2025 and 2035.
The global immersion cooling industry stood at USD 522.6 million in 2024.
The global immersion cooling industry is anticipated to reach USD 2,379.4 million by 2035 end.
India is set to record the highest CAGR of 17.3% in the assessment period.
The key players operating in the global immersion cooling industry include The DOW Chemical Company, 3M, FUCHS LUBRICANTS CO., Solvay, Shell Inc., Chemours.
| Estimated Size, 2025 | USD 636 million |
|---|---|
| Projected Size, 2035 | USD 2,379.4 million |
| Value-based CAGR (2025 to 2035) | 14.1% |
| Market Share (2023) | USD 2,660.1 million |
|---|---|
| Market Share (2033) | USD 15,974.3 million |
| Market CAGR (2023 to 2033) | 19.6% |
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