Data-center cooling stocks fall after Nvidia CEO comments at CES

Shares of several makers of data-center cooling equipment fell after Nvidia CEO Jensen Huang said Rubin chips can be cooled with water at temperatures that do not require water chillers.

Shares of companies that make data-center cooling equipment fell on Tuesday after comments by Nvidia's chief executive at the CES trade show in Las Vegas. Jensen Huang said Nvidia's next-generation Rubin chips can be cooled with water at a temperature that does not require a water chiller. The remarks arrived as investors considered potential changes in demand for chilled-water systems used in data centers. Key facts: - Johnson Controls International's shares fell as much as 11%, its worst intraday drop since 2022. - Modine Manufacturing's shares fell as much as 21%; Carrier Global and Trane Technologies also declined. - Jensen Huang said Rubin chips can be cooled with water at temperatures that do not require water chillers. - Barclays analyst Julian Mitchell wrote that, given Nvidia's central role in the AI ecosystem, the company's comments should not be taken lightly. Summary: The comments corresponded with sharp intraday declines for several cooling-equipment makers, reflecting investor concern about potential demand shifts in data-center cooling. Analysts noted Nvidia's influence within the AI ecosystem. Undetermined at this time.