Industry Insight｜NVIDIA Expands CDU Supply Chain, Ushering in a Structural Inflection Point for the AI Liquid Cooling Industry

With the rapid iteration of AI computing power, computing clusters act as the 'core engine' of the technology industry. Meanwhile, liquid cooling systems serve as critical infrastructure to ensure the long-term stable operation and temperature control of computing clusters. As the core hub of liquid cooling systems, CDU (Cooling Distribution Unit) determines the heat dissipation efficiency, operational stability and energy consumption performance of high-end AI computer rooms through its technical capability, delivery quality and supply chain system.

Recently, NVIDIA has updated its global Tier-1 CDU supplier list, expanding the original 4 suppliers to 6. Two leading international refrigeration giants, Carrier and Stulz, have officially joined the list. Superficially, the adjustment merely increases the number of suppliers; essentially, it triggers an in-depth restructuring of the global AI liquid cooling industrial chain. Substantial irreversible changes have taken place in industrial competition logic, supply chain pattern and profit structure, marking that the industry has officially transitioned from an oligopolistic stage to a standardized, market-oriented and highly competitive mature phase.

I. Original Pattern: Four Giants Build High-End CDU Monopoly Barriers

Before Q2 2026, the Tier-1 CDU suppliers within NVIDIA’s global NPN direct supply system remained stable, including Vertiv, CoolIT, Schneider-owned Motivair, and Nidec. The four enterprises long monopolized the core orders of high-end AI computing power CDU products worldwide, establishing a solid industrial barrier with closed-loop technology and locked orders.

The four manufacturers had clear divisions, accurately covering diverse high-end computing power application scenarios:

• Vertiv: A global leader in liquid cooling CDU. It deeply participates in the reference design of NVIDIA Rubin architecture and focuses on high-end integrated liquid cooling solutions, ranking among the top in the global high-end CDU market in terms of market share.
  
• CoolIT: A benchmark enterprise for ultra-high-power liquid cooling, specializing in supercomputers and high-density computing clusters above 2MW, serving top-tier supercomputing projects.
  
• Motivair (Schneider): A reliability benchmark for data center liquid cooling. It is compatible with mainstream computing platforms such as GB200, with its stability verified by large-scale commercial applications.
  
• Nidec: Leveraging sophisticated motor technology, it delivers excellent heat dissipation efficiency with balanced cost performance and stability, covering high-end computing power markets in Asia and North America.
  

NVIDIA locked the high-end supply chain through a dual mechanism of technical certification and order binding. Stringent technical standards, compatibility requirements, leakage protection and redundant design raised the industry entry threshold. A large number of core orders from top cloud manufacturers were concentrated among the four Tier-1 suppliers, sustaining a high gross profit margin across the industry for a long time. Small and medium-sized manufacturers could only undertake low-end renovation and supporting OEM businesses with narrow profit margins and no industry discourse power.

II. Industry Change: Carrier & Stulz Join to Restructure the Global Supply Chain

In May 2026, NVIDIA officially added two international temperature control giants, Carrier and Stulz, expanding its Tier-1 CDU supplier roster to six. This capacity expansion is not a simple supplier supplement, but a strategic adjustment made by NVIDIA targeting production capacity, cost and global layout.

The two new entrants precisely made up for the shortcomings of the original supply chain:

• Carrier: A global leader in the refrigeration industry with large-scale production capacity and extreme cost control capabilities. It is capable of delivering millions of CDU units in bulk, solving the production capacity shortage in the high-density computing power era.
  
• Stulz: A benchmark enterprise for European precision temperature control. With profound experience in high-end data center temperature control, it strengthens NVIDIA’s delivery capacity in the European market and high-end financial computing scenarios, optimizing the global supply chain layout.
  

Behind this adjustment lies NVIDIA’s clear strategic intention: to break the price alliance of the four original suppliers, introduce competition to force industrial cost optimization, expand production capacity to match the large-scale implementation of high-density computing power equipment in the second half of the year, achieve global regional coverage relying on six giants to diversify supply chain risks, and further consolidate its leading position in the industry.

III. Industry Trends: Declining Gross Profit, Upgraded Technology & Concentrated Production Capacity

The numerical change from 4 to 6 suppliers has established three irreversible trends for the liquid cooling industry.

1. Rational Decline in Industrial Gross Profit & Fully Competitive Market

New entrants cut product quotations by virtue of scale cost advantages, forcing established leading manufacturers to optimize their pricing systems passively. The era of high gross profit for high-end CDU products has ended, and industrial profits have returned to a reasonable range. Small and medium-sized manufacturers lacking technological and production capacity advantages face further squeezed profit margins. Enterprises with low-end OEM and homogeneous products will be gradually eliminated from the market.

2. Rising Technical Threshold & Upgraded Industrial Standards

The supplier expansion has not lowered entry requirements; instead, NVIDIA has upgraded CDU technical specifications. The equipment is required to support 1MW-level heat dissipation capacity, with the cold plate flow channel precision controlled within ±0.01mm. Core components adopt N+1 redundant design, and the fault switching time is strictly limited to less than 5 seconds. Stringent standards have blocked the vast majority of small and medium-sized enterprises from the high-end supply chain, continuously elevating industrial technical barriers.

3. Concentrated Production Capacity & Increasing Industrial Concentration

The six leading manufacturers are continuously expanding production, with the annual output of a single factory reaching thousands of units. Core computing power orders are highly concentrated. Small and medium-sized manufacturers can only undertake marginal orders such as old computer room renovation and low-density computing power projects, with shrinking market shares. Industrial resources are rapidly gathering towards leading enterprises with advanced technology, sufficient production capacity and qualified certifications.

IV. Positioning of Domestic Manufacturers: Rooted in Local Markets, Focused on Supporting Business & Steady Breakthroughs

None of the domestic manufacturers have been included in NVIDIA’s global direct supply list for Tier-1 suppliers, currently focusing on regional exclusive supply and supporting OEM services.

As a China-exclusive Tier-1 supplier of NVIDIA, Invicool is deeply engaged in the local computing power market and adapts to domestic GB300 and Rubin projects. Outstanding domestic enterprises such as Chiheng, Gaolan and Shenling focus on core supporting components including cold plates, pipelines and intelligent monitoring systems, providing OEM and supporting services for international leading manufacturers to enter the supply chain indirectly.

In the short term, it is difficult for domestic enterprises to enter the global top-tier supply chain. In the long run, benefiting from the rapid growth of China’s computing power industry, as well as cost advantages and rapid service capabilities, domestic liquid cooling manufacturers have clear growth potential in regional markets, segmented tracks and supporting supply chains. Continuously polishing core technologies, optimizing manufacturing processes and binding leading supply chains are the core development directions for domestic manufacturers at this stage.

V. Industry Summary: An Inflection Point Arrives, Only the Strong Survive

The supply chain reshuffle of NVIDIA CDU marks a critical turning point for the liquid cooling industry to evolve from extensive growth to standardized, large-scale and professional development. The industry has bid farewell to crude growth and entered a high-quality competition stage focusing on technology, production capacity, cost and delivery.

The liquid cooling industry will witness an accelerated elimination cycle in the next six months to one year. Backward production capacity and homogeneous small and medium-sized enterprises will be phased out, while high-quality enterprises with core technologies, large-scale production capacity and compliant qualifications will benefit sustainably. Whether for international giants, local leading enterprises or supporting supply chain manufacturers, only by adapting to industrial trends, iterating technologies intensively and optimizing product systems can enterprises consolidate their market positions in the computing power wave.

The computing power era is an irresistible general trend, and the value of liquid cooling infrastructure is becoming increasingly prominent. Standing at the industrial inflection point, enterprises can achieve long-term sustainable development only through intensive cultivation and adaptive iteration.