The worldwide market for the physical infrastructure that keeps data centers powered, cooled and online reached $14 billion in manufacturer revenue during the second quarter of 2026, up 27% from a year earlier, according to Dell’Oro Group’s latest Data Center Physical Infrastructure report.
That number does not include the GPUs and CPUs doing the computing. Dell’Oro’s DCPI category tracks the equipment around them: uninterruptible power supplies, thermal management, heat rejection, cabinet power distribution, busway, racks, containment, software and related services. In other words, it measures the physical systems required to turn a room full of expensive accelerators into an operating data center.
Cooling is the fastest-moving part of the market. Thermal management revenue expanded more than 40% year over year, with direct liquid cooling and heat-rejection equipment both growing faster than the broader segment. That lines up with the engineering shift already visible in high-density AI halls, where rack power is moving beyond what conventional air cooling can comfortably handle. BitcoinVersus.Tech recently covered a study finding a 17% PUE improvement from liquid cooling.
Power infrastructure is changing at the same time. Dell’Oro says UPS revenue grew about 20%, concentrated in large three-phase systems as AI halls standardize around megawatt-class power blocks. Vendors are also moving toward medium-voltage architectures and preparing for 800 VDC distribution. Busway remains the preferred overhead power train for many AI clusters, and Dell’Oro says supply—not demand—is currently the limiting factor.
The direction is already visible in new hardware. BitcoinVersus.Tech recently examined a 1 MW 800 VDC AI rack design, while broader Open Compute Project infrastructure spending could approach $892 billion by 2030.
The customer mix is also changing. Colocation providers were the largest DCPI customer segment in the quarter, followed by hyperscalers. The fastest growth came from Dell’Oro’s “Other Cloud” category, which includes neoclouds and AI model builders; AI-specialized cloud infrastructure roughly doubled from a year earlier. Traditional enterprise buyers continued to lose share.
Supplier strategy is shifting with that demand. Dell’Oro points to continued consolidation across cooling and power, including Ecolab’s acquisition of CoolIT Systems, Vertiv’s agreement to acquire UtilityInnovation Group, and SLB’s agreement to acquire heat-exchanger maker Kelvion. Those deals show how infrastructure vendors are trying to own more of the path from utility input to rack power and from chip heat to outdoor heat rejection. The physical plant around AI compute is becoming a larger part of the competitive stack.
The harder constraint is increasingly outside the data hall. Dell’Oro identifies siting, permitting, grid interconnection and long-lead electrical equipment as the most serious near-term brakes on deployment. That concern is supported by developments in PJM, where Reuters reported that data center demand is forecast to triple to about 29 GW by 2030 while the grid faces a projected 6.8 GW shortfall.
That distinction matters. A delayed data center is not necessarily a cancelled one. Projects can slip because power studies, permits, transformers, switchgear or cooling equipment are not ready even while underlying compute demand remains intact. For equipment vendors and operators, the next phase of the AI buildout may therefore be defined as much by execution—power delivery, thermal engineering and commissioning—as by processor performance.
Why it matters: the AI infrastructure boom is becoming a power-and-cooling story. The servers may get the headlines, but the fastest-growing spending is increasingly going into the systems that let those servers operate safely at megawatt scale.
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