Alphabet (GOOGL) Stock: Google Eyes Chinese Suppliers as AI Cooling Demand Surges

TLDR

• Google’s procurement team visited China this month to meet with liquid cooling suppliers, including Envicool
• Supply of liquid cooling parts has tightened globally as AI data center buildouts accelerate
• The AI server liquid cooling market is projected to hit $17 billion in 2026, up from $8.9 billion in 2025
• Envicool showed off a coolant distribution unit built to Google’s specs at a recent industry event
• Goldman Sachs says Envicool expects quarterly liquid cooling revenue growth, with potential Google orders in the pipeline

Google is looking to China to solve a cooling problem. A procurement team from the company’s Taiwan operations visited China this month to meet with liquid cooling equipment suppliers for its data centers.

Two sources familiar with the visit confirmed that the team met with Shenzhen-based Envicool. A separate source said the team also plans to meet with at least one other supplier. Neither Google nor Envicool responded to requests for comment.

Alphabet Inc., GOOGL

Liquid cooling systems circulate water or other fluid directly over or around hardware. In AI data centers, where computing is packed tightly and runs hot, air cooling alone can no longer keep up.

The visit reflects how tight supply has become across the entire data center supply chain — not just for advanced chips, but for lower-profile hardware like cooling components too.

A Market Growing Fast

The global market for AI server liquid cooling systems is expected to more than double, growing from $8.9 billion in 2025 to over $17 billion in 2026. That forecast, from JPMorgan, is driven by demand from Nvidia and cloud providers rolling out custom AI chips.

Envicool, founded in 2005 and now valued at around $14 billion, posted a 40% revenue jump in the first nine months of last year. At a recent industry event, the company displayed a coolant distribution unit (CDU) — the component that distributes coolant to server racks — built specifically to Google’s specs.

A Goldman Sachs report, following an analyst call with Envicool this month, said the company expects its liquid cooling revenue to grow on a quarterly basis through this year. Potential Google orders for fifth-generation CDUs are in the pipeline.

Envicool is also expanding. It plans to build out a new factory in Guangdong province and has facilities in development in Thailand and the United States.

Chinese Suppliers Gaining Ground

Chinese suppliers have been gaining traction in the liquid cooling market, helped by strong demand at home. Large-scale domestic data center projects have let them scale production and bring costs down.

Key players include Lingyi iTech and Feilong Auto Components, alongside server makers like Lenovo. But the market itself is fragmented, with many companies supplying different parts of a full cooling system.

Taiwanese firms remain major suppliers for Google in Asia. Foxconn, Auras, and Delta Asia all currently provide cooling components. Chinese firms appear to be picking up additional orders as supply tightens.

Other Chinese hardware makers benefiting from AI data center growth include optical transceiver makers Innolight and Eoptolink. Printed circuit board manufacturers like Victory Giant Technology list both Nvidia and Google as clients.

Wall Street analysts currently rate GOOGL stock as a Strong Buy, based on 26 Buy ratings and six Holds over the past three months. The average price target of $376.57 implies roughly 23% upside from current levels.

The post Alphabet (GOOGL) Stock: Google Eyes Chinese Suppliers as AI Cooling Demand Surges appeared first on CoinCentral.