AWS just crushed Vertiv? Stock tanks over 6% after Amazon’s bold cooling move

Vertiv Holdings stocks dropped more than 6% on Thursday, reeling from a surprise announcement by Amazon Web Services that could directly threaten one of Vertiv’s key revenue streams, as per a report.

Vertiv Stock Slips After AWS Unveils In-House Cooling Tech

The drop followed AWS’s unveiling of its own custom cooling hardware designed to support Nvidia’s next-gen AI chips—technology that overlaps significantly with Vertiv’s offerings, as it provides liquid cooling solutions for data centers, according to an Investing.com report.

Stock Target Still Optimistic For Now

GuruFocus reported that according to the one-year price targets provided by 20 analysts, the average target price for Vertiv stock is $120.56, with a high estimate of $150.00 and a low estimate of $82.00.


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Amazon's Game-Changing Cooling System

The cause of the shakeup is AWS’s new In-Row Heat Exchanger (IRHX), a homegrown cooling system built to handle the extreme heat output of Nvidia’s Blackwell GPUs, as per the report. These cutting-edge chips are driving a new wave of AI computing, but their power demands have created a significant thermal challenge for data center operators, according to Investing.com.

Until now, companies like Vertiv have been key players in addressing those needs through advanced liquid cooling systems, as per the report. But AWS, one of the biggest cloud providers and potentially one of Vertiv’s top customers, just announced it's taking matters into its own hands, according to the report.

Developed in collaboration with Nvidia, the IRHX system went from design to production in just 11 months, according to the report. It uses a hybrid approach, combining liquid cooling through cold plates directly on GPU chips with air-based components that help remove heat through fan-coil arrays, and is expected to deliver high-performance cooling without the space or water usage of traditional methods, as reported by Investing.com.

AWS vice president Dave Brown noted that standard cooling techniques "would take up too much data center floor space or increase water usage substantially," as quoted in the report.

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Analyst Flags Growth Concerns

Bloomberg Intelligence analyst Mustafa Okur highlighted the potential impact on Vertiv, saying, "Amazon Web Services rolling out its own server liquid-cooling system could weigh on Vertiv’s future growth prospects. Around 10% of overall sales come from liquid cooling, we calculate, and AWS may be one of the largest customers," as quoted by the Investing.com report.

A Broader AI Push by AWS

The timing of the announcement coincides with AWS rolling out new AI computing instances featuring Nvidia’s latest chips, all supported by its custom-built Nitro infrastructure for performance monitoring and networking, according to the Investing.com report.

FAQs

Why did Vertiv’s stock drop this week?
Because AWS revealed it built its own cooling tech for AI servers—potentially cutting into Vertiv’s business.

What is AWS’s new cooling system?
It’s called the In-Row Heat Exchanger (IRHX), and it cools high-performance AI chips like Nvidia’s Blackwell GPUs, as per the Investing.com report.