Vertiv Stock Dips Following AWS' In-House Cooling Solution Announcement.

Vertiv Holdings has dropped 8% in late Thursday morning trading after Amazon Web Services (AWS) revealed its in-house cooling system for data centers powered by Nvidia GPUs. The system, developed by AWS Vice President David Brown, is designed to efficiently cool data centers and reduce operating costs. The news has negatively impacted Vertiv's stock, as the company provides cooling and other data center infrastructure solutions.

Vertiv Holdings (NYSE: VRT) saw its stock drop by approximately 8% in late Thursday morning trading after Amazon Web Services (AWS) unveiled its proprietary cooling system designed for data centers powered by Nvidia GPUs. The new system, developed by AWS Vice President Dave Brown, is aimed at efficiently cooling data centers and reducing operating costs.

AWS's In-Row Heat Exchanger (IRHX) system is designed to address the substantial thermal demands of Nvidia's latest AI GPUs, which consume significant energy and generate considerable heat when running AI workloads. The IRHX system circulates chilled liquid close to the server rows, effectively removing heat from the densely packed GPUs. This innovative solution is suitable for both new data center applications and retrofitting existing ones, eliminating the need for a complete redesign [1].

The announcement has negatively impacted Vertiv's stock, as the company provides cooling and other data center infrastructure solutions. Vertiv's shares fell 11% on Thursday following the news, with Bloomberg Intelligence analyst Mustafa Okur noting that AWS's custom cooling solution could weigh on Vertiv's future growth prospects [2].

AWS developed the cooling technology in partnership with Nvidia, taking just 11 months from design to production. The system combines liquid and air-based components, circulating coolant to GPU chips through cold plates while removing heat via fan-coil arrays. The cooling innovation coincides with AWS launching new computing instances that give customers access to Nvidia's most powerful AI server configurations, supported by AWS's Nitro infrastructure platform for networking and system monitoring [2].

The development of the IRHX is part of AWS’s broader strategy to own more of its infrastructure. In recent years, AWS has invested heavily in developing its own chips, storage systems, and networking gear to power its cloud services. This approach allows Amazon to reduce its reliance on third-party suppliers and balance operational performance with cost. The IRHX launch further solidifies AWS’s position as a leader in cloud infrastructure innovation [1].

Other tech giants, such as Microsoft, Google, and Meta, are also investing in custom hardware and cooling systems tailored to AI workloads. However, AWS’s extensive global footprint of data centers and experience in building and deploying custom hardware at scale give it a significant advantage. The IRHX could enhance AWS’s AI-ready infrastructure, making it more efficient, sustainable, and scalable [1].

References:
[1] https://www.ainvest.com/news/aws-introduces-irhx-liquid-cooling-system-nvidia-ai-gpus-2507/
[2] https://finance.yahoo.com/news/vertiv-stock-falls-aws-unveils-153259891.html