Analysis of Reddit Post Claims on Data Center Cooling Inefficiencies and AI Infrastructure Valuations

On November 18, 2025 (EST), a Reddit post argued that data centers are built with inefficient cooling systems, leading to imminent obsolescence and overvaluation of AI infrastructure investments. The post recommended buying put options on Oracle Corporation (ORCL) and Vertiv Holdings Co (VRT) as a bearish bet on the sector’s long-term depreciation and unaccounted cooling costs. [Note: Reddit post is user-generated content (Tier4 source) and should be interpreted with caution.]

• Vertiv (VRT):
  Closed down
  1.07%
  ($164.86) on November 18, despite announcing a strategic collaboration with Caterpillar to address data center energy optimization the same day [0,4]. The decline aligns with a broader tech sector pullback (-0.55% on Nov18) and concerns over lofty AI valuations [0,6].
• Oracle (ORCL):
  Closed slightly up
  0.29%
  ($220.49) on Nov18 but has experienced a
  $315 billion market cap loss
  since its September 10 OpenAI partnership announcement, indicating ongoing investor skepticism about the deal’s value [0,3].

• The cooling inefficiency claim is a recognized industry challenge: U.S. data centers are projected to use up to
  12% of electricity by 2028
  (from 4.4% in 2023) due to AI workloads, per Flexential’s 2025 State of AI Infrastructure Report [2].
• However, companies are actively mitigating risks: VRT is expanding cooling solutions via partnerships (Caterpillar) and liquid cooling technologies [0,4,6], while Oracle is investing in energy-efficient infrastructure (Exadata X11M,
  100% renewable energy goal by 2025
  ) [1,7].

• Mixed: Tech sector underperformance (-0.55%) reflects valuation concerns, but energy/utility sectors (up
  2.01%/1.18%
  ) benefit from data center demand for power solutions [0].

Metric	ORCL	VRT
Current Price	$220.49	$164.86
Market Cap	$618.54B	$63.03B
P/E Ratio (TTM)	51.16x	62.21x
Volume (Nov18)	18.82M (below avg 24.81M)	7.56M (above avg7.42M)
Recent Growth	-$315B market cap loss (Sept-Nov25)	43% organic sales growth (Americas Q325) [0]

Sector Performance: Tech (-0.55%) and Industrials (-0.16%) underperformed on Nov18, while Energy (2.01%) led gains [0].

1. Directly Impacted:
   ORCL (AI cloud infrastructure), VRT (data center cooling/power solutions).
2. Related Sectors:
   AI computing hardware, cloud services, power generation (Caterpillar), liquid cooling tech vendors.
3. Supply Chain:
   Upstream (energy providers), downstream (AI cloud users like OpenAI).

• Financial Health:
  Unable to access recent financial indicators (revenue growth, profit margins, debt levels) for ORCL/VRT due to IP limits.
• Valuation Details:
  Need analyst consensus on ORCL’s OpenAI deal ROI and VRT’s P/E ratio (62x) relative to industry peers.
• Cooling Efficiency Metrics:
  Lack of company-specific data on ORCL/VRT’s cooling system efficiency vs. industry benchmarks.

• Bear Case:
  The Reddit post’s claim about unaccounted cooling costs could erode AI infrastructure valuations if not addressed. ORCL’s OpenAI deal risks and VRT’s high P/E ratio are red flags [3,4].
• Bull Case:
  VRT’s Caterpillar partnership and Oracle’s renewable energy investments are proactive steps to mitigate cooling inefficiencies, supporting long-term growth [1,4,7].

• ORCL:
  Users should be aware of the $315 billion market cap loss from the OpenAI deal, which may impact long-term valuation [3].
• VRT:
  This development raises concerns about VRT’s high P/E ratio (62x) amid ongoing tech sector pullbacks, warranting careful consideration of valuation sustainability [0,6].

1. ORCL’s quarterly earnings updates on the OpenAI partnership’s contribution.
2. VRT’s adoption rate of Caterpillar collaboration solutions.
3. Sector trends in data center cooling efficiency (liquid cooling vs. traditional methods) [8].
4. Analyst revisions for ORCL/VRT’s target prices.

Note: Tier 1 sources (Oracle, Pew, Flexential) are prioritized for credibility. Lower-tier sources (Reddit) are noted for transparency.

This analysis is for informational purposes only and does not constitute investment advice. Always conduct thorough research before making financial decisions.