#Industry News
AI Server Liquid Cooling and Connector Industry Development Trend
40% Gross Margin, 10% to 70% Revenue Shift: The Connector Industry's Liquid Cooling Inflection Point
AI server competition has shifted to high-precision connector manufacturing, where liquid cooling connectors earn a 40% gross margin versus 30% for air cooling and 26% for high-speed backplane products, but only two mature mass-production liquid cooling lines exist worldwide, constrained by microchannel processing and brazing bottlenecks. AI liquid cooling accounts for about 10% of leading domestic connector makers' revenue, projected to surge to 60%-70% after large-scale shipment begins in mid-next year, while the zero-burr delivery standard mandatory since late 2025 forms a high barrier for new entrants. The industry shows cyclical swings and severe polarization. Despite CPO's emergence, liquid cooling remains the most cost-effective thermal solution for the next five to six years. EXTRCOOL provides one-stop liquid cooling solutions.