Microsoft is taking chip cooling to the next level with a new liquid that can be injected directly into semiconductor chips, slashing GPU temperatures by up to 65%.

Unlike traditional cold plates used in most data centers, Microsoft’s breakthrough system removes heat three times more efficiently. The company aims to deploy this fluid for next-generation AI chips. They are working with fabrication and silicon partners to bring the technology into production. However, they haven’t given a timeline.

Cooling is one of the biggest expenses in running data centers, with electrical systems accounting for 40–45% of costs. Faster, more effective cooling means GPUs can handle heavier workloads during peak demand, boosting efficiency.

The tech giant also revealed plans to invest $4 billion in a new Wisconsin data center. This is in addition to a $3.3 billion project already under construction and set to be operational in 2026.

The news rattled cooling-solution providers, with NYSE-listed Vertiv falling over 6% after the announcement.

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