LG Electronics in talks with Nvidia to supply cooling solutions for AI servers

LG Electronics is in talks to supply a cooling solution for Nvidia's servers, eyeing the heat generated by the artificial intelligence (AI) industry as a new business opportunity.

A turbo chiller installed in the main mechanical room at LG Science Park in Magok, Gangseo District, western Seoul [LG ELECTRONICS]

LG Electronics is in talks to supply a cooling solution for Nvidia's servers, eyeing the heat generated by the artificial intelligence (AI) industry as a new business opportunity.

The company plans to expand its heating, ventilation and air conditioning (HVAC) business — previously focused on large commercial buildings — into AI data centers. By leveraging its differentiated liquid-cooling technology, LG aims to secure contracts with major tech companies, such as Nvidia, and grow at twice the market average.

LG Electronics held a press briefing on Tuesday at LG Science Park in Magok, Gangseo District, western Seoul, to present the business direction of its Electronics Solutions (ES) business division, which oversees the HVAC unit, along with its new cooling solutions for AI data centers.

“We will commercialize our liquid-cooling solution within this year to rapidly enter the AI data center cooling market, and begin full-scale supply from next year,” said Lee Jae-sung, head of the ES Business Division and executive vice president. “Our goal is to triple our cooling solution orders for data centers compared to last year and achieve growth twice as fast as the market.”

Cooling solutions generally fall into two categories: air cooling and liquid cooling. AI data centers, which generate large amounts of heat, primarily use liquid cooling with chilled water, as conventional air cooling is insufficient to cool AI semiconductor chips that can exceed 90 degrees Celsius (194 degrees Fahrenheit).

Lee Jae-sung, executive vice president and head of LG Electronics' ES Business Division, presents the company’s HVAC business strategy and AI data center solutions during a press briefing at LG Science Park in Magok on June 8. [NEWS1]

LG Electronics unveiled a new “Core Tech” technology that enables the stable operation of its liquid-cooling system even if key sensors fail. “We are currently undergoing certification procedures and discussions to enter Nvidia’s server supply ecosystem,” Lee added.

LG also plans to extend its existing chiller business to data centers. A chiller is a device that cools water, which then circulates through buildings to provide air conditioning via heat exchangers. LG aims to generate 1 trillion won ($730.8 million) in revenue from chillers within two years, citing a projected global market of $12 billion by 2027.

The company is also accelerating its overseas expansion. It will establish a dedicated HVAC product development unit in India later this year, expanding beyond its current base in Changwon, South Gyeongsang. LG also plans to strengthen its localized strategies and value chains across the Global South. In addition, it is considering sequential acquisitions in adjacent fields to enhance its HVAC portfolio and create synergy with its existing operations.

Lee Jae-sung, left, executive vice president and head of LG Electronics' ES Business Division, examines a cooling distribution unit (CDU), part of the company's liquid-cooling solution for AI data centers. [NEWS1]

Going forward, LG Electronics aims to diversify its business portfolio by bolstering its B2B operations, including HVAC. The strategy comes as profitability in traditional home appliance segments, such as TVs and refrigerators, declines due to intensified competition from Chinese manufacturers.

“HVAC is not just about selling products — it requires installation, maintenance and engineering expertise tailored to each building’s heating and cooling needs,” said Bae Jung-hyun, head of SAC business. “We intend to widen the gap with Chinese competitors before they catch up in these areas.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff. BY LEE GA-RAM [kim.minyoung5@joongang.co.kr]