Vertiv is benefiting from the growth in data center capital expenditures and the expanding direct liquid cooling market, with a $9.5 billion backlog. The company is focusing on providing higher-margin lifecycle services to support AI data centers. Global data center capex increased 59% in Q3 2025, while the direct liquid cooling market grew by 85%.

The build-out of AI infrastructure faces an energy constraint, with data center electricity consumption projected to increase from 448 TWh in 2025 to 980 TWh by 2030. Vertiv plays a critical role in providing power distribution and management systems, thermal management solutions, data center racks, and software services to support complex AI workloads.

Vertiv’s financial results in Q3 2025 were strong, with revenue up 29% year over year to $2.68 billion and adjusted diluted EPS rising 63% to $1.24. The company reported a book-to-bill ratio of 1.4, with orders increasing by 60% year over year. Vertiv exited Q3 with a $9.5 billion backlog, providing strong revenue visibility into 2026.

Vertiv’s recent acquisition of PurgeRite enhances its thermal management portfolio. The company is also expanding its manufacturing capacity in Asia to meet the demand for AI-ready, high-density infrastructure. Vertiv’s services platform, which includes remote monitoring and predictive analytics, is expected to benefit as data center systems become more complex.

Vertiv is positioned to address the energy and efficiency challenges faced by AI infrastructure. Despite trading at roughly 33 times forward earnings estimates, the company’s strong order backlog and high revenue visibility justify its valuation. The Motley Fool Stock Advisor team did not include Vertiv among their top 10 stock picks, but the company’s growth potential remains promising.

Read more at Yahoo Finance: AI’s Next Bottleneck Isn’t Hardware — It’s Efficiency. Here’s the Stock to Watch.