LG Electronics shares surge 6% after Nvidia qualifies AI cooling unit

LG Electronics Inc (KS:066570) shares surged over 6% on Tuesday following Nvidia's qualification of the company's 2.6-megawatt coolant distribution unit (CDU) for its DSX AI Factory platform. The stock was trading at 215,000 won in Seoul on Tuesday, marking a 6.2% increase. This performance surpassed the 1.2% rise in the broader KOSPI index.

Nvidia's qualification of the unit signifies its adherence to the DSX reference-design requirements and inclusion in the NVIDIA DSX AI Factory Marketplace. The 2.6MW CDU is engineered to handle the heat produced by extensive AI server clusters, functioning as part of a direct-to-chip liquid-cooling system. It circulates coolant through cold plates attached to CPUs and GPUs, transferring the generated heat to the data center's cooling infrastructure.

This qualification enhances LG's range of Nvidia-approved cooling equipment, which also includes 600-kilowatt and 1MW CDUs. LG's recognition of the 2.6MW system as a "Large-Scale" solution aligns with the growing power intensity of AI accelerators, leading to heightened heat generation in data-center servers. With rack power density nearing hundreds of kilowatts, there is a surge in demand for centralized megawatt-class cooling systems capable of serving numerous high-density server racks.

LG's "Chip-to-Chiller" portfolio, encompassing chillers, computer room air handlers, and liquid-cooling systems, targets a larger market opportunity in AI infrastructure, covering the cooling process from heat absorption at AI chips to heat rejection at the data-center facility. Nvidia had already verified a 600kW CDU in July, which passed more than 100 technical evaluation criteria related to cooling performance, reliability, and failover capabilities.

LG also introduced a new air-cooled centrifugal chiller for AI data centers on Monday, augmenting its cooling portfolio just one day prior to the Nvidia qualification announcement.