The Zhitong Finance App learned that Orient Securities released a research report saying that Nvidia VR and Google's TPU v7/v8 shipment climbing will be the core driving force for the release of liquid cooling demand, which is expected to drive the global liquid cooling industry chain from small-batch shipments to large-scale mass production. The performance growth and guidelines of Taiwanese liquid cooling manufacturers will further verify the certainty of overseas liquid cooling demand volume in the second half of the year. Demand for liquid cooling in data centers is expected to be released at an accelerated pace from the third quarter, and domestic liquid cooling industry chain companies are expected to gradually enter the stage of order execution and gradual mass production in the second half of the year.
Orient Securities's main views are as follows:
Large-scale shipments of Nvidia VR and Google TPU v7/v8 are expected to accelerate the release of demand for liquid cooling
According to media reports, in August, Microsoft and OpenAI announced that the first batch of Nvidia Vera Rubin NVL72 racks had been delivered, marking that the Nvidia VR platform had officially entered the phase of mass production; Google confirmed at the second quarter earnings conference that TPU had begun to be delivered to data center customers, and the TPU v8 is expected to be officially mass-produced in the second half of the year. The bank believes that starting in the third quarter, Nvidia VR and Google TPU v7/v8 will be the core driving force for releasing demand for liquid cooling, which is expected to drive the global liquid cooling industry chain from small-batch shipments to large-scale mass production.
Taiwanese manufacturers have clear guidelines, and liquid cooling emissions are expected to be highly deterministic in the second half of the year
Qiyi's July revenue reached a record high of NT$18.590 billion, up 57%/6%, respectively. The company said that Nvidia VR series liquid cooling products are expected to contribute revenue in the third quarter. ASIC liquid cooling products are expected to be released in the fourth quarter, and the data center liquid cooling penetration rate is expected to exceed 50% in 2027; Shuanghong's July revenue reached a record high of NT$3,765 billion, up 117%/39%, respectively. The company said that the increase in demand for Nvidia GB series products and the beginning of production of ASIC liquid cooling products in the third quarter will jointly drive the increase in shipments. Taiwanese liquid cooling manufacturers saw a year-on-month increase in performance in July and put forward clear guidelines for mass production of Nvidia/ASIC liquid cooling products in the second half of the year, which will further verify the certainty of overseas liquid cooling demand volume in the second half of the year.
It is expected that from the third quarter, domestic liquid cooling industry chain companies will gradually usher in order execution or performance fulfillment
Invek's interim report revealed second-quarter revenue of 1,841 billion yuan, up 12%/57% year on month; net profit to mother was 176 million yuan, up 5%/1934% year over month; according to company announcements, the company has become a data center liquid cooling partner for overseas technology giants such as Nvidia, Google, and Intel. According to the report of Feilong Co., Ltd., in the first half of the year, the company ordered more than 50,000 liquid cooling pump terminals for platforms below 10 kW, and nearly 10,000 liquid cooling pump terminals for platforms above 10 kW; nearly 20 of the company's liquid cooling pump projects have been delivered in small batches. The bank believes that some domestic liquid cooling companies, such as Invec and Feilong Co., Ltd., have obtained approval from overseas customers and received orders. With the gradual mass production of next-generation Nvidia/Google chips, it is expected that domestic liquid cooling industry chain companies will experience marginal changes in orders or performance fulfillment in the third quarter.
Risk Alerts
Overseas data center expansion rate is lower than expected, liquid cooling penetration rate is lower than expected, domestic liquid cooling supplier's overseas progress is lower than expected, and market competition is intensifying