Worthington Projects Over 13 Million Data Center Tanks for Q1 FY2027
1h ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
worthington-industriesdata-center-infrastructure
Fazen Markets Editorial Desk
Collective editorial team · methodology
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Worthington Industries has projected it will ship a minimum of 13 million ASME-certified pressure tanks for data center cooling applications in the first quarter of its 2027 fiscal year, according to a report from June 24, 2026. The company anticipates that headwinds related to the adoption of lower-global-warming-potential A2L refrigerants will begin to moderate by the second quarter. This guidance provides a clear metric for the booming demand in data center infrastructure, particularly for thermal management systems required by high-density computing and artificial intelligence workloads. The first fiscal quarter of 2027 corresponds to the period beginning June 1, 2026.
Data center construction is experiencing a global surge, driven by the computational demands of AI model training and inference. Power and cooling requirements for new facilities have escalated dramatically, making efficient thermal management a critical bottleneck. The transition to A2L refrigerants, which are less harmful to the ozone layer but are mildly flammable, has introduced regulatory and engineering complexities for cooling system manufacturers. Worthington's projection indicates that the industry is adapting to these new standards, with a normalization of supply chains and component integration expected in the coming quarters. The current macroeconomic backdrop features elevated interest rates, yet capital expenditure in digital infrastructure remains a top priority for major cloud providers.
This guidance follows a period of significant growth for Worthington's pressure cylinder segment. In the third quarter of fiscal 2024, the segment generated $268 million in net sales. The company's forward-looking statement on data center tanks suggests a strategic pivot toward high-growth, specialized industrial markets beyond its traditional automotive and energy storage applications. The moderation of A2L-related challenges is a key catalyst, suggesting that design validation and compliance hurdles are being systematically overcome.
Worthington's projection of 13 million tanks for a single quarter represents a substantial volume. ASME tanks are specialized vessels built to American Society of Mechanical Engineers codes, designed to safely contain gases under pressure for closed-loop cooling systems. For comparison, the global data center cooling market was valued at over $12 billion in 2024 and is projected to grow at a compound annual growth rate of approximately 13% through 2030.
| Metric | Value | Context |
|---|---|---|
| Projected Tank Shipments (Q1 FY27) | 13,000,000+ units | Minimum guidance for data center applications |
| Expected Headwind Moderation | Q2 FY27 | Timeline for A2L refrigerant challenges to ease |
| Worthington Q3 FY24 Sales (Pressure Cylinders) | $268 million | Baseline for segment performance |
| Global Data Center Cooling Market (2024) | >$12 billion | Addressable market size |
The company's stock, WOR, has a market capitalization of approximately $3.5 billion. Peers in the industrial and thermal management space, such as Modine Manufacturing Company (MOD), have also seen strong performance, with MOD shares rising over 80% in the past year versus the S&P 500's 14% gain. The specific focus on ASME tanks highlights a high-margin, engineering-intensive niche within the broader cooling market.
Worthington's bullish guidance is a positive indicator for the entire data center supply chain. Companies that manufacture cooling components, such as heat exchangers and pumps, should see derivative demand. This includes firms like Vertiv Holdings Co (VRT) and nVent Electric (NVT), whose products are essential for complete thermal management solutions. The guidance also reinforces the capital expenditure commitments announced by cloud giants like Microsoft, Amazon Web Services, and Google, signaling that infrastructure build-out is proceeding at pace.
A counter-argument is that any delay in the adoption of A2L refrigerant systems or a slowdown in data center construction permits could push out this demand timeline. The projection is also a minimum figure, leaving room for upside surprise but also potential downside if execution falters. Institutional positioning data suggests increased interest in industrial names leveraged to the AI infrastructure theme, with inflows into sector-specific ETFs. The guidance may put a floor under Worthington's valuation as it demonstrates tangible revenue visibility.
The primary catalyst for confirming this guidance will be Worthington's fiscal Q1 2027 earnings report, expected in early July 2026. Investors should monitor management commentary on order book strength and manufacturing throughput for the ASME tank division. The timeline for A2L headwind moderation in Q2 will be a key focus during quarterly earnings calls for the remainder of 2026.
Key levels to watch for WOR stock include the $65 support zone, which has held多次 in recent months, and resistance near the 52-week high of $78. Broader market sentiment on rate cuts from the Federal Reserve will also influence capital-intensive industrial stocks. The next FOMC meeting on July 26, 2026, will be critical for gauging the funding environment for large-scale data center projects.
ASME tanks are pressure vessels that store refrigerant or water used in precision cooling systems for data halls. They are critical for managing the immense heat generated by high-performance computing servers, especially those used for AI. The tanks must meet strict safety standards to handle the pressures of advanced cooling cycles, making them a specialized component with high barriers to entry for manufacturers.
A2L refrigerants have lower global warming potential than previous generations but are mildly flammable, requiring new safety protocols and system designs. This transition created a temporary headwind as the industry adapted, impacting the design and certification of associated equipment like pressure tanks. Worthington's guidance that these headwinds will moderate suggests it has developed compliant tank systems and that the broader supply chain is catching up.
The demand extends to companies that produce complementary cooling infrastructure. Vertiv Holdings Co is a leader in data center cooling and power management solutions. nVent Electric manufactures enclosures and thermal management products. companies like Carrier Global (CARR) and Trane Technologies (TT), which produce large-scale HVAC systems, are key beneficiaries of the data center construction boom.
Worthington's tank guidance quantifies the massive scale of infrastructure required to support the AI-driven expansion of data centers.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
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