Cooling fan manufacturer Power Logic is looking toward future prospects in the AI server field, with its server-related products expected to enter mass production in 2025. Contrary to the hype for liquid cooling, however, the company will continue to focus on air cooling for the time being, says chairman Vincent Hsu.
According to Hsu, amid the current rush for liquid cooling, success stories are likely to be few and far between: "Anyone can say they're going to do liquid cooling, but the real test is whether one can secure orders." Power Logic predicts air cooling to remain the dominant server cooling method in 2024, with more than 80% of servers using air cooling solutions well into 2025.
Liquid cooling has seen a surge in profile with the heightened thermal dissipation requirements of Nvidia's next-gen Blackwell chips, and many companies have been jostling for a share in the server market, where liquid cooling solutions used to be uncommon. However, Hsu notes that liquid cooling for servers comes with its own set of problems: in addition to technical hurdles, cash flow also becomes an issue.
Although the high cost of liquid cooling for AI servers may lead to higher revenues for cooling solution providers, they will nevertheless need additional funds for operation when payment terms with their customers are often in the 3–6 month range. As a result, Power Logic has adopted a more nuanced outlook, with Hsu noting that the company will only take on orders that it finds feasible to do.
Furthermore, simply having metal stamping equipment does not mean that a company has the know-how to produce cold plates. Even if one were to manufacture cold plates, they might not be certified for use, and with the high cost of AI servers themselves, no one can afford any accidents.
Lin Yu-Sheng, chairman of cooling solution provider Auras, has also noted liability as one of the issues concerning liquid cooling: who should be held responsible if a leak occurs, the cooling component provider, the cooling system supplier, or the server cabinet maker? Lin further notes that it will quickly become evident who truly has the expertise to succeed in this field, joking that when shipment volumes truly pick up in 2025, everyone will know who has been swimming all this time without putting swimming trunks on.
Higher profit margins in 2025 with non-PC cooling products
In terms of Power Logic's annual revenue, Vincent Hsu expects the second half of 2024 to account for 55% of the year's revenue. On the whole, however, revenue in 2024 is expected to remain on par with 2023 owing to the transitional period between old and new graphics card platforms; since Nvidia's new RTX 5000 series is not expected to launch until the end of this year, Power Logic is anticipating growth momentum in 2025.
In addition, the company also anticipates its efforts outside its core PC cooling business to begin bearing fruit next year. Power Logic's server fans are currently undergoing certification, with substantial shipment volumes expected in 2025, targeting the air cooling requirements for small- and mid-sized clients instead of large cloud service providers.
Meanwhile, after three years of development, the company's automotive products have already reached C-sample status in its customers' approval process. Power Logic will aim to provide main system fans and wireless charging fans for European automakers through Tier 1 suppliers, shipments of which will begin to pick up in 2025.
Finally, the company will begin shipping low volumes of its industrial control products to clients in Europe in the latter half of 2024, with substantial volumes expected to follow in 2025. Fans for server, automotive, and industrial control applications will help drive profits for the company as well, due to their higher profitability: Power Logic aims to increase the revenue share of non-graphics card related products to 30% in 2025, up from 5% in 2024.
Article translated by Kevin Wang
