SMCI vs. VRT: Which Liquid Cooling Provider is a Better Pick Now?

Super Micro Computer (SMCI) and Vertiv Holdings (VRT) are key players in the AI-driven data center liquid-cooling market, projected to grow at an 11.8% CAGR through 2032. While SMCI demonstrates technological leadership with its DLC-2 launch and high liquid-cooled rack production, it faces near-term headwinds from customer purchasing delays and margin contraction, leading to projected earnings declines for fiscal 2026. Conversely, Vertiv shows robust expansion through strategic acquisitions like CoolTera and collaborations with NVIDIA on AI factory designs, forecasting strong fiscal 2025 revenue and earnings growth of 24.6% and 34.74%, respectively, positioning it as the stronger investment choice due to its superior financial outlook.

Analysis

The data center cooling market is projected to grow at an 11.8% CAGR from 2025 to 2032, driven by AI and high-performance computing workloads. Super Micro Computer (SMCI) is a significant player, with its liquid-cooled GPU and AI platforms contributing over 70% to its top line in Q4 FY25 and producing over 2000 direct liquid cooling (DLC) racks monthly. The company further innovated with its DLC-2 technology launch in May 2025, promising up to 40% electricity cost reduction.

Despite technological advancements, SMCI faces near-term headwinds, including delayed customer purchasing decisions and margin contraction due to increased price competition from rivals like HPE and Dell. This is reflected in Zacks Consensus Estimates for Q1 and Q2 FY26 earnings, projecting year-over-year declines of 37% and 5% respectively. In contrast, Vertiv Holdings (VRT) demonstrates robust growth, leveraging strategic acquisitions like CoolTera in 2023 and collaborations with NVIDIA on AI factory projects.

Vertiv's strong thermal management portfolio and investments are driving significant financial performance, with fiscal 2025 revenue and earnings projected to grow by 24.6% and 34.74% year-over-year, respectively. While SMCI's forward P/S of 1.00x is above its median, VRT trades at a higher 6.09x, also above its median, indicating strong market expectations. The article concludes VRT's financials make it a stronger pick, supported by its Zacks Rank #2 (Buy) versus SMCI's #3 (Hold).

Key Decisions for Investors

• Investors should consider Vertiv (VRT) for its strong projected fiscal 2025 revenue and earnings growth of 24.6% and 34.74% respectively, driven by strategic acquisitions and AI infrastructure collaborations.
• Monitor Super Micro Computer (SMCI) for resolution of near-term headwinds, specifically customer purchasing delays and margin pressure, which are impacting its fiscal 2026 earnings outlook.
• Given the data center cooling market's projected 11.8% CAGR, both companies operate in a high-growth sector, but VRT currently presents a more favorable financial profile and analyst rating.