The advent of artificial intelligence has sent demand for data centers skyrocketing, along with industrial components to keep all the AI chips from overheating. "The key for chipmakers with AI ambitions is keeping data centers cool," Melius Research analyst Jake Levinson told CNBC. Levinson said cooling technologies manufacturers Carrier Global , Trane Technologies and Johnson Controls are all seeing higher demand for HVACs.
For Caterpillar specifically, power generator sales were up 9% in the first quarter from the year-earlier period. While the company does not disclose data center share, Jefferies industrial analyst Stephen Volkmann estimates roughly 25% of demand is coming from data centers — growing 15%-20% year over year. "However, they are capacity constrained, which is why they are investing capex to increase large engine manufacturing capacity," said Volkmann to CNBC.