Why Vertiv Is the Must-Own Stock in the AI Infrastructure Revolution

The AI infrastructure revolution is accelerating at an unprecedented pace, driven by the exponential growth of high-density computing workloads. At the heart of this transformation lies a critical shift: the transition from traditional air cooling to advanced liquid cooling systems, paired with high-density power solutions. Vertiv, a leader in data center infrastructure, is uniquely positioned to capitalize on this shift, making it a must-own stock for investors seeking exposure to the next phase of AI-driven innovation.

The Market Imperative: From Air to Liquid Cooling

The thermal demands of AI accelerators, such as NVIDIA's H100 and AMD's MI300X, have rendered conventional air cooling obsolete. According to a report by MarketsandMarkets, the global data center liquid cooling market is projected to grow from $2.84 billion in 2025 to $21.15 billion by 2032, at a compound annual growth rate (CAGR) of 33.2%. Specifically, the AI data center liquid cooling segment is expected to expand from $3.2 billion in 2025 to $15.7 billion by 2035, with a CAGR of 16.9%. This growth is fueled by the need to manage rack densities exceeding 130 kW, a reality for hyperscale AI deployments.

Direct-to-chip (D2C) liquid cooling currently dominates the AI segment, accounting for 47% of the market in 2025. This method, which uses cold plates to absorb heat directly from GPUs and CPUs, offers superior efficiency compared to air cooling. Leading vendors like NVIDIA explicitly recommend D2C solutions for their high-performance accelerators. Meanwhile, hybrid cooling systems-combining liquid-to-liquid, liquid-to-air, and liquid-to-refrigerant configurations-are gaining traction, projected to grow from 8% of the market in 2021 to 33% by 2028. Vertiv's focus on hybrid systems positions it to address both new and legacy data centers, ensuring flexibility in an evolving landscape.

Vertiv's Strategic Dominance in Liquid Cooling

Vertiv ranks among the top 23 global leaders in data center cooling, alongside peers like Schneider Electric and COOLIT SYSTEMS. The company's innovation in liquid cooling is underscored by its development of hybrid systems tailored for AI workloads. For instance, Vertiv's CoolPhase Flex system allows for air- or liquid-cooled deployments that can be reconfigured as business needs evolve. This adaptability is critical as data centers transition from traditional IT workloads to AI applications, which demand dynamic thermal management.

Recent partnerships further solidify Vertiv's market position. In 2025, Vertiv collaborated with Caterpillar to integrate power generation technologies with modular cooling systems, enabling data centers to reduce grid dependency while maintaining resiliency. Similarly, a partnership with GreenScale has deployed Vertiv's Vertiv OneCore hybrid data centers across Europe, supporting AI-ready platforms with rack densities exceeding 200 kW. These initiatives highlight Vertiv's ability to streamline AI infrastructure deployment, reducing on-site complexity and deployment time.

High-Density Power Solutions: Enabling AI's Energy-Intensive Workloads

Beyond cooling, Vertiv is advancing high-density power solutions to meet the volatile demands of AI workloads. These include uninterruptible power supply (UPS) systems and power distribution equipment capable of handling rapid fluctuations-from 10% idle to 150% overload. Liquid cooling systems are increasingly paired with these solutions to ensure continuous operation, a critical requirement for AI-driven applications.

Vertiv's Q3 2025 financial results underscore the strength of this strategy. Organic orders surged 60% year-over-year, driven by AI infrastructure demand, while the company's backlog reached $9.5 billion, up 30% year-over-year. Adjusted operating profit hit $596 million, a 43% increase compared to Q3 2024. These metrics reflect not only current demand but also future visibility, as the book-to-bill ratio of 1.4x indicates sustained momentum.

The Investment Case: A Leader in a High-Growth Sector

Vertiv's dominance in liquid cooling and high-density power solutions is underpinned by its technological innovation, strategic partnerships, and robust financial performance. As AI workloads drive exponential growth in data center thermal and power demands, Vertiv is uniquely positioned to benefit from the industry's shift toward liquid cooling and hybrid systems.

The AI data center liquid cooling market is projected to grow at a 16.9% CAGR through 2035, and Vertiv's recent contracts and financials demonstrate strong execution. For investors, Vertiv represents not just a play on AI's rise but a strategic bet on the infrastructure that will power the next decade of technological advancement.