Thermal management / data-center liquid cooling (Modine) — coolant distribution units
AI exposure 51% — derived from reported segment revenue, not asserted.
The Thermal Layer: Why AI Is Turning Cooling Into a Growth Industry — an industry deep dive with its slide deck, published on Frontier Macro & Markets, 2026-09-14, covering VRT, TT, CARR, JCI, AAON, NVT, MOD.
Physical Infrastructure → Thermal & Cooling · figures rebased to Q1 FY2027, reported 2026-07-29
Data-center cooling (57.1% pro forma) and commercial HVAC&R (42.9%) are now the whole company: Performance Technologies — the vehicle and off-highway thermal business that was 30% of revenue and off-map — left on 1 Oct 2026 in the Reverse Morris Trust with Gentherm, so Thermal & Cooling is Modine entirely.
Modine after the 1 Oct 2026 spin-off of Performance Technologies into Gentherm (Reverse Morris Trust; Modine received a $156.0M cash distribution). Pro forma Q1 FY2027 on the two remaining segments, $610.2M: DATA CENTERS 57.1% ($348.6M, +90% YoY — Airedale chillers/CDUs/air handling, anchored by a $4B hyperscaler chiller LTA, one global tech customer >11% of consolidated sales = primary B2 Thermal & Cooling) + Commercial HVAC&R 42.9% ($261.6M, +22% YoY). Performance Technologies ($277.8M in Q1, vehicle/off-highway thermal, off-map) left with the spin and is excluded. FY2027 data-center guide…
Moat. Data Centers is now the largest reported segment — $348.6M in Q1 FY2027, roughly 40% of sales and +90% YoY — on Airedale chillers and CDUs plus a $4B long-term chiller agreement, the largest contract in company history. The advantage is the LTA and the design-in position, not the technology: Vertiv, nVent and Boyd are credible alternatives on the same sockets.
Bottleneck / pricing power. Demand exceeds supply — the Q1 FY2027 revenue miss was a production constraint, not an order problem — but that has not yet converted into price. Adjusted EBITDA grew 5% on 28% sales growth and the margin compressed ~270bps to ~12.2% on capacity-ramp and supply-chain cost. The reaffirmed FY2027 guide requires roughly 16-17% for the full year, so the pricing-and-leverage question is unresolved rather than answered.
Role in the AI stack. The data-center liquid-cooling (CDU/coil) supplier.
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