Capitalizing on the AI-Driven Data Center Cooling Boom: Hedge Fund-Backed Leaders in Quantum and AI Infrastructure

The AI revolution is heating up-and so are the data centers that power it. As artificial intelligence and high-performance computing (HPC) workloads surge, the demand for advanced has become a critical bottleneck for the industry. According to a report by Arizton, the global data center liquid cooling market, , is projected to balloon to $10.7 billion by 2030, growing at a staggering 51.93% CAGR. This explosion in demand has drawn the attention of hedge funds and institutional investors, who are aggressively backing companies positioned to capitalize on this infrastructure boom. For investors seeking outsized returns, the intersection of AI, , and presents a compelling opportunity.

Vertiv: A $1 Billion Bet on Liquid Cooling and AI Integration

Vertiv (VRTX) has emerged as a dominant force in the data center cooling sector, with its recent $1 billion acquisition of PurgeRite-a leader in thermal management and filtration systems-underscoring its commitment to addressing the heat challenges of AI-driven workloads according to stocktwits. The acquisition, which expands Vertiv's liquid cooling portfolio, is expected to enhance heat transfer efficiency and reduce downtime in high-density computing environments. Complementing this move, Vertiv also acquired Waylay NV, a generative AI software firm, to integrate AI-based monitoring and predictive analytics into its infrastructure solutions as reported by investors. This dual focus on hardware and software innovation positions Vertiv as a one-stop provider for AI factories, a concept highlighted by the company during its 2025 analyst conference.

Hedge funds have taken notice. according to Nasdaq, while institutional investors like Advisors Asset Management Inc. increased their stakes by 43.4%. Vertiv's strategic alignment with AI infrastructure and its aggressive M&A activity make it a high-conviction play for investors seeking exposure to the cooling sector.

SPX Technologies: Scaling Through Strategic Acquisitions

SPX Technologies (SPXC) has levered a series of acquisitions to solidify its leadership in data center cooling. The company's integration of KTS and Sigma & Omega-specialists in thermal management and detection systems-has driven a 22.6% year-over-year revenue increase to $592.8 million in Q3 2025. These moves have not only boosted margins but also expanded SPX's capabilities in HVAC systems, a critical component for managing the thermal loads of AI and HPC clusters.

Hedge fund activity in SPX has also surged, according to Prospero AI. Advisors like Advisors Asset Management Inc. have increased their holdings, reflecting confidence in SPX's ability to scale with the AI infrastructure boom. With its acquisition of Crawford United Corporation further bolstering its HVAC segment, SPX is well-positioned to benefit from the long-term tailwinds of AI-driven cooling demand.

LiquidStack: Direct-to-Chip Cooling for AI's Next Frontier

LiquidStack, a pioneer in direct-to-chip and immersion cooling, has secured $20 million in Series B funding led by Tiger Global. This capital infusion will accelerate the deployment of its liquid cooling solutions, which are critical for managing the extreme heat generated by AI accelerators like GPUs and TPUs. Unlike traditional air cooling, LiquidStack's technology , making it a preferred choice for hyperscalers and AI-first companies.

The company's rapid growth has attracted institutional attention, with hedge funds and private equity firms recognizing its potential to disrupt the cooling market. As continue to intensify, LiquidStack's ability to scale its solutions will be a key differentiator in a sector where thermal management is no longer optional but existential.

Submer: Expanding the AI Cooling Ecosystem

Submer, a leader in immersion cooling, has taken a different but equally impactful approach by forming strategic partnerships rather than pursuing acquisitions. CleanSpark, a blockchain and AI infrastructure firm, selected Submer as its first strategic partner to build gigawatt-scale AI data centers in North America. Submer's modular, liquid-cooled data center designs enable rapid deployment of AI infrastructure, a critical advantage in a market where time-to-market is paramount.

The company's expansion into India-through partnerships with local OEMs and the establishment of a manufacturing facility-further underscores its global ambitions. While Submer has not made direct acquisitions, its ecosystem-driven strategy positions it to capture a significant share of the AI cooling market, particularly in regions with surging demand for low-latency, high-density computing.

Quantum Infrastructure: The Next Frontier for Cooling Innovators

As AI converges with quantum computing, the need for advanced cooling solutions becomes even more urgent. Quantum systems, which operate at near-absolute zero temperatures, require specialized thermal management to maintain . While Vertiv, SPX, and LiquidStack have not yet announced quantum-specific partnerships, their existing expertise in liquid cooling and thermal optimization positions them to play a pivotal role in this emerging field.

Hedge funds are already betting on the quantum-AI infrastructure stack. In Q3 2025, funds like and Citadel increased their holdings in energy and utility companies like Vistra Corp. and Constellation Energy, recognizing the critical role of in supporting both AI and quantum workloads. This trend highlights the importance of investing in companies that can bridge the gap between traditional infrastructure and .

Conclusion: A High-Conviction Play for the AI Era

The data center cooling sector is at an inflection point, driven by the exponential growth of AI and the nascent potential of quantum computing. Vertiv, SPX Technologies, LiquidStack, and Submer are not just beneficiaries of this trend-they are architects of the infrastructure that will power the next decade of technological progress. With hedge funds and institutional investors pouring capital into these companies, now is the time to act. For investors seeking to capitalize on the AI-driven cooling boom, the message is clear: the future is liquid, and the winners are already being backed by the market's sharpest minds.