Stringent EU Regulations on Energy Efficiency (e.g., EN50600, EU Taxonomy) Pushing Operators to Adopt Greener Solutions
The European data center cooling market is projected to reach $20.55 billion by 2035 from $6.76 billion in 2024, growing at a CAGR of 10.18% during the forecast period 2025-2035.
The rise in data generation, cloud computing, and the expansion of digital infrastructure are driving the data centre cooling industry in Europe. Efficient cooling systems are becoming essential for preserving equipment reliability and uptime as the need for high-performance computing rises. Strict EU rules and sustainability goals have impacted the market, leading to a move towards low-energy, eco-friendly cooling technology.
The region's adoption of sophisticated, energy-efficient cooling solutions is accelerating due to ongoing innovation and mounting pressure to cut energy usage, even while obstacles like high initial investment and system complexity still exist.
The market for data centre cooling in Europe is changing quickly because to the exponential rise in workloads related to artificial intelligence, cloud computing, and data production. Effective thermal management has become essential for maintaining hardware longevity, operational continuity, and regulatory compliance as data centres grow in size and complexity. Energy-efficient solutions are a strategic focus for operators throughout the region because cooling systems can contribute up to 40% of a data center's overall energy consumption.
The adoption of cutting-edge cooling technologies is mostly being driven by European nations, especially Germany, the Netherlands, Ireland, and the Nordics.
These include direct-to-chip systems, liquid cooling, and free air cooling, which are made to manage high-density computing with little effect on the environment. Low-carbon, water-efficient, and environmentally friendly cooling techniques are becoming more popular in the region as a result of the push for sustainability brought about by EU climate rules, the Renewable Energy Directive, and the European Green Deal.
Europe's diverse climates have an impact on cooling tactics as well. While southern nations need more durable solutions to sustain efficiency in hot conditions, northern locations benefit from ambient cold air to lessen reliance on mechanical systems. The European data centre cooling market is expected to continue to innovate and grow as regulatory pressure increases and digital infrastructure keeps growing.
Market Trends, Drivers and Challenges of Europe Data Center Cooling Market
Market Trends
Shift toward liquid and immersion cooling to manage high-density AI and HPC workloads
Rising focus on energy-efficient and sustainable cooling systems to meet ESG and carbon neutrality goals
Adoption of free cooling and economizers in colder regions like Scandinavia to reduce energy consumption
Growing use of AI and automation for real-time thermal management and predictive maintenance
Integration of modular and prefabricated cooling solutions for faster deployment and scalability
Increase in green data centers powered by renewable energy and eco-friendly cooling technologies
Market Drivers
Surge in data traffic and cloud computing demand driving data center expansion across Europe
Stringent EU regulations on energy efficiency (e.g., EN50600, EU Taxonomy) pushing operators to adopt greener solutions
Government incentives and sustainability mandates supporting low-carbon infrastructure development
Need to reduce operational costs, particularly energy expenses tied to cooling (up to 40% of total energy use)
Rise in edge data centers and colocation facilities, requiring compact and efficient cooling systems
Market Challenges
High upfront costs for advanced cooling technologies like liquid immersion and adiabatic systems
Regulatory complexity and variations across European countries creating compliance difficulties
Water usage concerns, especially in drought-prone regions, limiting the viability of water-based cooling
Legacy infrastructure limitations slowing the transition to next-gen cooling methods
Skilled labor shortage in cooling system design, integration, and maintenance across the region
Key Market Players and Competition Synopsis
This report crafts a strong competitive strategy tailored to the Europe data center cooling market. It evaluates market rivals, suggests methods to stand out, and offers guidance for maintaining a competitive edge.
By adhering to these strategic directives, companies can position themselves effectively in the face of market competition, ensuring sustained prosperity and profitability.
Some of the prominent names in this market are:
Schneider Electric
Asetek, Inc.
Submer
Munters
ALFA LAVAL
Condair Group
Danfoss
Johnson Controls International plc
STLUZ
DCX Liquid Cooling Systems
Rittal GmbH & Co. KG
Key Attributes:
Report Attribute Details No. of Pages 150 Forecast Period 2025 - 2035 Estimated Market Value (USD) in 2025 $7.8 Billion Forecasted Market Value (USD) by 2035 $20.55 Billion Compound Annual Growth Rate 10.1% Regions Covered Europe
Expand
Key Topics Covered:
1 Markets
1.1 Trends: Current and Future Impact Assessment
1.1.1 Trends Shaping Data Center Cooling Market
1.1.2 Increase in Data Requirements
1.1.2.1 Increasing Rack Power Density - New Data Center Reality
1.1.2.2 5G Services to Drive Exponential Growth in Data Centers
1.1.3 Growth in Demand for Environment-Friendly Cooling Systems
1.1.3.1 Carbon Neutrality
1.1.3.2 Utilization of Renewable Energies
1.1.3.3 Green Initiatives by Government Body
1.1.4 New Data Center Trends toward Adoption of Liquid Cooling, 2024-2034
1.1.4.1 Case Study
1.1.4.1.1 Immersion Cooling Technology
1.1.4.1.1.1 Advancing Data Center Cooling Efficiency: The University of Leeds' Adoption of Fully Immersed Liquid-Cooled Servers
1.1.4.1.1.2 PeaSoup Cloud: Pioneering Eco-Friendly Cloud Services with Immersion Cooling Technology
1.2 Evaporative Cooling Market for Data Center Overview
1.3 Supply Chain Overview
1.4 Research and Development Review
1.5 Ecosystem and Ongoing Programs
1.6 Market Dynamics Overview
1.6.1 Market Drivers
1.6.1.1 High-Efficient Cooling Systems
1.6.1.1.1 Emerging Technologies Promote Cost-Effectiveness
1.6.1.1.2 AI-Assisted Automatic Cooling Control
1.6.1.1.3 Power Usage Effectiveness (PUE) Optimization with Economic Cooling Solutions
1.6.1.2 Increasing Number of Data Centers and Spendings
1.6.1.3 Thermal Energy Recovery Conversion from Data Centers
1.6.1.4 Water Usage Effectiveness Driving Adoption of Alternate Cooling Solutions
1.6.1.5 Retrofitting to a Free Cooling Data Center
1.6.2 Market Restraints
1.6.2.1 High Investment Costs for Non-Conventional Cooling Systems
1.6.2.2 Technical Challenges to Cooling Systems
1.6.2.2.1 Air and Free Cooling Systems Adaption Complexities
1.6.2.2.2 Reliability Limitations with Immersion Liquid Cooling
1.6.3 Business Opportunities
1.6.3.1 Growing Emphasis for Retrofit Data Center
1.6.3.2 Data Center Infrastructure Management for Power Management
1.6.3.3 Increasing Number of Distributed or Edge Data Centers
1.7 Key Start-Ups in the Europe Data Center Cooling Market
2 Regions
2.1 Regional Summary
2.2 Europe
2.2.1 Key Market Participants in Europe
2.2.2 Business Drivers
2.2.3 Business Challenges
2.2.4 Application
2.2.5 Product
2.2.6 Europe (By Country)
2.2.6.1 Germany
2.2.6.2 France
2.2.6.3 U.K.
2.2.6.4 Italy
2.2.6.5 Netherlands
2.2.6.6 Spain
2.2.6.7 Rest-of-Europe
3 Competitive Benchmarking & Company Profiles
3.1 Next Frontiers
3.2 Geographic Assessment
3.3 Competitive Landscape
3.4 Company Profiles
3.4.1 Schneider Electric
3.4.2 Asetek
3.4.3 Submer
3.4.4 Munters
3.4.5 ALFA LAVAL
3.4.6 Condair Group
3.4.7 Danfoss
3.4.8 Johnson Controls International
3.4.9 STULZ GMBH
3.4.10 DCX Liquid Cooling Systems
3.4.11 Rittal GmbH & Co. KG
3.5 Other Key Market Participants
For more information about this report visit https://www.researchandmarkets.com/r/pkpioe
About ResearchAndMarkets.com
ResearchAndMarkets.com is the world's leading source for international market research reports and market data. We provide you with the latest data on international and regional markets, key industries, the top companies, new products and the latest trends.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Wire
19 minutes ago
- Business Wire
Reynold Lemkins Drives Cross-Border Deep Tech Investment, Featured Prominently at Asia's Leading Capital and Innovation Forums
HONG KONG & MACAU--(BUSINESS WIRE)--Reynold Lemkins Group, a global investment firm known for its long-term cross-border capital strategy, made a notable impact this May at two of Asia's premier events: the Greenwich Economic Forum (GEF) Hong Kong and BEYOND Expo 2025 in Macau. At GEF Hong Kong, Reynold Lemkins Asia Chief Investment Officer Kris Haoran Liu was invited to speak on a high-level roundtable titled 'Family Office Investment Outlook', moderated by Tae Yoo, Managing Director of Hong Kong Exchanges and Clearing (HKEX). Liu emphasized IPO as not merely an exit but a strategic entry point into long-term value creation, especially in sectors undergoing structural transformation. He also highlighted Hong Kong's pivotal role as a pricing anchor for global capital. The forum, which brought together global financial leaders including Nouriel Roubini (Chairman & CEO, Roubini Macro Associates), Kenny Lam (CEO, Two Sigma Asia Pacific), and Jan Boomaars (CEO, Optiver), underscored the rising relevance of Asia—especially Hong Kong—in the evolving landscape of alternative investments, economic realignment, and tech-led growth. In Macau, at BEYOND Expo 2025 —Asia's largest tech innovation summit—Reynold Lemkins took part as a Legacy Partner, hosting private sessions with deep tech founders, researchers, and institutional LPs. The firm engaged across verticals including AI, advanced manufacturing, robotics, and frontier healthtech, reinforcing its thesis of value-backed, scalable innovation across borders. 'Reynold Lemkins Group demonstrated clear conviction in identifying globally relevant tech solutions, from regulatory-ready biotech platforms to next-gen energy systems and smart infrastructure,' commented a tech investor familiar with the firm's presence in Macau. Recent investments reflect this diversified thesis. In addition to health-focused companies like Cloudbreak Pharma and VISEN Pharmaceuticals, the firm has also actively supported high-growth industrial and AI ventures such as Contemporary Amperex Technology (CATL), Sanhua Intelligent Controls, and Unisound, exemplifying its multi-sector strategy across late-stage and semi-public market opportunities. To learn more, visit follow Reynold Lemkins on LinkedIn, or explore insights via Medium.
Business Wire
19 minutes ago
- Business Wire
SingleStore Expands Presence to Serve Japan and Accelerate Global Enterprise AI Innovation
TOKYO--(BUSINESS WIRE)--SingleStore, a database delivering the performance, simplicity and flexibility needed to power enterprise AI, today announced its official launch in Japan. The move underscores the rising demand for high-performance, AI-optimized data infrastructure in one of the world's most technologically advanced markets. The expansion further cements SingleStore's leadership in delivering the real-time capabilities and foundational data strategies essential to building the next generation of high-performing enterprise AI applications. With this expansion, SingleStore is bringing its ultra low-latency AI-ready database platform to one of the world's largest and most innovation-driven economies. The move comes as Japan accelerates its national AI strategies and enterprises increasingly seek scalable, real-time data platforms like SingleStore that support global Fortune 500 companies at scale to develop next-generation AI applications. 'Expanding into Japan is both a strategic and symbolic step in SingleStore's mission to power global AI progress,' said Raj Verma, CEO of SingleStore. 'Japan is home to one of the most technologically advanced economies in the world, and we're thrilled to use our real-time, AI-optimized data capabilities to power its next wave of innovation. This new chapter in Japan underscores the worldwide demand for real-time, scalable, and AI-optimized data infrastructure, and we're excited to be part of it.' This expansion comes at a time of immense growth for SingleStore. The company grew from $10 million in ARR to over $100 million in just four years and achieved unicorn status with a valuation of over $1 billion following its most recent funding round in 2022. SingleStore currently has customers across 50+ countries, with its expansion to Japan marking its eighth office globally. Seasoned enterprise technology leader Tadashi 'Troy' Nishioka will drive SingleStore's work in Japan as Managing Director and brings deep experience from his work in Japan's cloud and data markets. Under Nishioka's leadership, the company will grow its local footprint through strategic hires, partnerships with leading cloud and system integrators, and a focus on serving industries including financial services, manufacturing, telecommunications, and healthcare. 'Our goal is simple: empower Japanese businesses to realize their AI ambitions by giving them the performance, scale, and simplicity they need,' said Nishioka. 'We're deeply committed to understanding the unique needs of Japanese enterprises and aligning with the country's culture of precision, quality, and continuous improvement to become a trusted partner for Japanese businesses harnessing the full potential of AI.' SingleStore's expansion into Japan builds on a deep presence across the APAC region, with customers in 12 APAC countries, a regional hub in Singapore and a strong presence in India. The company already serves over 100 customers in the region, including leading enterprises such as Nikkei, Samsung, Tata, DBS Bank, Posco, and 6sense. 'Since partnering in 2017, we've trusted SingleStore for its exceptional performance and innovative approach,' said Hajime Sano, software engineer and engineering manager at Nikkei. 'It's now a core part of our data platform, powering real-time analytics that support approximately 1,500 journalists at the Nikkei Online Edition. With SingleStore, we've reduced data latency from 45 minutes to just 200 milliseconds – transforming how we understand reader behavior and deliver relevant content. The launch of SingleStore's Tokyo office signals a strong commitment to Japan, and we look forward to continuing our partnership.' As enterprises around the globe look to consolidate legacy databases, accelerate AI adoption, and modernize their infrastructure, SingleStore is the database of choice for building that future in real time. Its unified platform uniquely supports hybrid transactional and analytical processing, vector and full-text search, and low-latency streaming ingest, making it ideal for powering modern AI applications. With built-in support for serverless ingest, integrated AI functions, and developer-optimized workflows, SingleStore provides the flexibility and power modern teams need to build intelligent, responsive AI applications. Its native handling of both structured and semi-structured data, compatibility with platforms including Snowflake, Postgres, SQL Server, Oracle and MySQL, and scalability across cloud environments allow organizations to unify their data architecture while dramatically reducing complexity and latency. Additional Resources: SingleStore will engage with local media and analysts in Japan over the coming weeks to share more about its expansion strategy and AI-driven innovations. About SingleStore SingleStore empowers the world's leading organizations to build and scale modern applications using the only data platform that allows you to transact, analyze and search data in real time. With streaming data ingestion, support for both transactions and analytics, horizontal scalability and vector and full text search capabilities, SingleStore helps deliver 10–100x better performance at 1/3 the cost of legacy architectures. Learn more at
Business Wire
2 hours ago
- Business Wire
Otter Tail Corporation Announces Second Quarter Earnings and Increases Annual Earnings Guidance
FERGUS FALLS, Minn.--(BUSINESS WIRE)--Otter Tail Corporation (Nasdaq: OTTR) today announced financial results for the quarter ended June 30, 2025. SUMMARY Produced diluted earnings per share of $1.85 in the second quarter of 2025. Increased midpoint of 2025 earnings per share guidance by $0.38 to $6.26 per share. Return on equity of 17% over the trailing twelve months. CEO OVERVIEW 'We are pleased with our second quarter financial results,' said President and CEO Chuck MacFarlane. 'Across our businesses, our team members remain committed to our mission - delivering value through building strong electric and manufacturing platforms - amidst dynamic market conditions. "During the second quarter, severe weather moved through Otter Tail Power's service territory, resulting in significant property and infrastructure damage, as well as tree loss. Approximately 30 percent of our customers experienced an interruption in electric service due to the storms. Our employees worked tirelessly to restore power to our customers as quickly and safely as possible. 'Beyond our storm response, Otter Tail Power continues to perform well, executing on our significant capital investment plan and regulatory priorities. We secured approval to directly assign and recover the capital investment for our two solar development projects from the Minnesota and South Dakota Commissions. We look forward to adding 345 MW of cost-effective solar generation to our portfolio to better serve our customers. Additionally, for the first time since 2018, we filed a request with the South Dakota Public Utilities Commission for permission to increase our electric rates by approximately $5.7 million. 'Our Manufacturing segment continues to navigate soft end market demand but remains well positioned to respond when market conditions improve. Our recently completed BTD Georgia facility is ramping up to full production capability and we look forward to being able to better serve our growing customers in the southeast. 'Plastics segment results outpaced our expectations for the second quarter. We continue to benefit from strong product demand and higher sales volumes as the sales prices of PVC pipe continue to recede. 'We are uplifting our 2025 diluted earnings per share guidance for the Plastics segment, increasing our consolidated guidance to a range of $6.06 to $6.46 from our previous range of $5.68 to $6.08. 'Our strategic diversification continues to serve us and our stakeholders well even as we return to more normalized levels of Plastics segment earnings, generating incremental cash for us to reinvest into our significant utility rate base growth plan. We remain confident in our ability to deliver on our investment targets, producing an earnings per share growth of 6 to 8 percent.' QUARTERLY DIVIDEND On August 4, 2025, the corporation's Board of Directors declared a quarterly common stock dividend of $0.525 per share. This dividend is payable September 10, 2025 to shareholders of record on August 15, 2025. CASH FLOWS AND LIQUIDITY Our consolidated cash provided by operating activities for the six months ended June 30, 2025 was $159.4 million compared to $223.5 million for the six months ended June 30, 2024, with the decrease primarily due to the timing of fuel cost and rider recoveries from our utility customers and the timing of payments for operating costs, as well as a decrease in earnings. Investing activities for the six months ended June 30, 2025 included capital expenditures of $124.2 million. Capital expenditures during the period were largely within our Electric segment, including investments in wind repowering, advanced metering infrastructure, and transmission line projects. Financing activities for the six months ended June 30, 2025 included the issuance of $100.0 million of long-term debt at Otter Tail Power; the proceeds of which were used to repay short-term borrowings, fund capital investments, and support operating activities. Financing activities for the six months ended June 30, 2025 also included net repayments of short-term borrowings totaling $69.6 million and dividend payments of $44.0 million. As of June 30, 2025, we had $170.0 million and $211.0 million of available liquidity under our Otter Tail Corporation and Otter Tail Power credit facilities, respectively, along with $307.2 million of available cash and cash equivalents, for total available liquidity of $688.2 million. Electric Segment The following table shows heating and cooling degree days as a percent of normal. Three Months Ended June 30, 2025 2024 Heating Degree Days 86.5% 68.8% Cooling Degree Days 114.2% 48.8% Expand The following table summarizes the estimated effect on diluted earnings per share of the difference in retail kilowatt-hour (kwh) sales under actual weather conditions and expected retail kwh sales under normal weather conditions for the three months ended June 30, 2025 and 2024. Operating Revenues increased $15.9 million primarily due to increases in fuel recovery and rider revenues, and the impact of favorable weather compared to the same period last year. Increased fuel recovery revenue was primarily driven by an increase in the price of natural gas and the cost of market energy. Increased rider revenue was largely from the recovery of our investments in our wind repowering projects. Net Income increased $0.7 million primarily due to the increase in revenues, as described above, partially offset by increased operating and maintenance expenses, including planned outage costs at Coyote Station, and increased depreciation and interest expense associated with our rate base investments. Manufacturing Segment Operating Revenues decreased $18.0 million primarily due to a 9% decrease in sales volumes, with declines experienced across several end markets, including agriculture, recreational vehicles, lawn and garden, and construction. Sales volumes were down at our metal fabrication business due to soft end market demand and inventory management efforts by manufacturers and dealers. A 7% decrease in steel costs, which are passed through to customers, also contributed to the decrease in operating revenues. Net Income decreased $3.4 million primarily due to lower sales volumes and enhanced profit margins in the second quarter of 2024, which benefited from the positive impact of the timing of pass-through steel cost fluctuations and the selling of lower cost inventory. The impacts of decreased operating revenues and profit margins were partially offset by a decrease in general and administrative costs. Plastics Segment Operating Revenues decreased $7.2 million primarily due to a 15% decrease in sales prices compared to the same period last year, continuing the steady decline in product pricing from peak market conditions in late 2022. The impact of decreased sales prices was partially offset by an 11% increase in sales volumes, driven by strong distributor and end-market demand for our products, coupled with increased production capacity following the completion of our expansion project at Vinyltech in late 2024. Active infrastructure investment and construction activity across our sales territories continue to contribute to strong demand for our products. Net Income decreased $7.5 million primarily due to decreased sales prices, as described above, partially offset by the 11% increase in sales volumes and a 15% decrease in PVC resin cost driven by global supply and demand dynamics which continues to result in elevated supply. Corporate Net Income increased $0.9 million primarily due to increased market-based gains on our corporate-owned life insurance policy investments. 2025 OUTLOOK We are increasing our 2025 diluted earnings per share guidance to a range of $6.06 to $6.46. We expect our earnings mix in 2025 to be approximately 37% from our Electric segment and 63% from our Manufacturing and Plastics segments, net of corporate costs. Our anticipated earnings mix in 2025 deviates from our long-term expected earnings mix of 65% Electric / 35% Non-Electric as we expect Plastics segment earnings to remain elevated in 2025 compared to our long-term view of normal earnings for this segment. The segment components of our 2025 diluted earnings per share guidance compared with actual earnings for 2024 are as follows: We are maintaining our earnings guidance for our Electric and Manufacturing segments and maintaining our Corporate cost outlook. We are increasing our Plastics segment earnings guidance based on: Better than expected financial results in the second quarter of 2025, Lower material costs anticipated for the remainder of the year, as the forecasted price of PVC resin has declined, and Revised expectations for PVC pipe pricing for the second half of the year. CONFERENCE CALL AND WEBCAST The corporation will host a live webcast on Tuesday, August 5, 2025, at 10:00 a.m. CT to discuss its financial and operating performance. The presentation will be posted on our website before the webcast. To access the live webcast, go to and select 'Webcast.' Please allow time prior to the call to visit the site and download any software needed to listen in. An archived copy of the webcast will be available on our website shortly after the call. If you are interested in asking a question during the live webcast, visit and follow the link provided in the press release announcing the upcoming conference call. FORWARD-LOOKING STATEMENTS Except for historical information contained here, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words 'anticipate,' 'believe,' 'can,' 'could,' 'estimate,' 'expect,' 'future,' 'goal,' 'intend,' 'likely,' 'may,' 'opportunity,' 'outlook,' 'plan,' 'possible,' 'potential,' 'predict,' 'probable,' 'projected,' 'should,' 'target,' 'will,' 'would' and similar words and expressions are intended to identify forward-looking statements. Such statements are based upon the current beliefs and expectations of management. Forward-looking statements made herein, which may include statements regarding 2025 earnings and earnings per share, long-term earnings, earnings per share growth and earnings mix, anticipated levels of energy generation from renewable resources, anticipated reductions in carbon dioxide emissions, future investments and capital expenditures, rate base levels and rate base growth, future raw materials costs, future raw materials availability and supply constraints, future operating revenues and operating results, and expectations regarding regulatory proceedings, as well as other assumptions and statements, involve known and unknown risks and uncertainties that may cause our actual results in current or future periods to differ materially from the forecasted assumptions and expected results. The Company's risks and uncertainties include, among other things, uncertainty of future investments and capital expenditures; rate base levels and rate base growth; risks associated with energy markets; the availability and pricing of resource materials; inflationary cost pressures; attracting and maintaining a qualified and stable workforce; changing macroeconomic and industry conditions that impact the demand for our products, pricing and margin; long-term investment risk; seasonal weather patterns and extreme weather events; future business volumes with key customers; reductions in our credit ratings; our ability to access capital markets on favorable terms; assumptions and costs relating to funding our employee benefit plans; our subsidiaries' ability to make dividend payments; cybersecurity threats or data breaches; the impact of government legislation and regulation including foreign trade policy and environmental; health and safety laws and regulations; changes in tax laws and regulations; the impact of climate change including compliance with legislative and regulatory changes to address climate change; expectations regarding regulatory proceedings, assigned service areas, the construction of major facilities, capital structure, and allowed customer rates; actual and threatened claims or litigation; and operational and economic risks associated with our electric generating and manufacturing facilities. These and other risks are more fully described in our filings with the Securities and Exchange Commission, including our most recently filed Annual Report on Form 10-K, as updated in subsequently filed Quarterly Reports on Form 10-Q, as applicable. Forward-looking statements speak only as of the date they are made, and we expressly disclaim any obligation to update any forward-looking information. Category: Earnings About the Corporation: Otter Tail Corporation, a member of the S&P SmallCap 600 Index, has interests in diversified operations that include an electric utility and manufacturing businesses. Otter Tail Corporation stock trades on the Nasdaq Global Select Market under the symbol OTTR. The latest investor and corporate information is available at Corporate offices are in Fergus Falls, Minnesota, and Fargo, North Dakota. OTTER TAIL CORPORATION CONSOLIDATED BALANCE SHEETS (unaudited) June 30, December 31, (in thousands) 2025 2024 Assets Current Assets Cash and Cash Equivalents $ 307,241 $ 294,651 Receivables, net of allowance for credit losses 180,823 145,964 Inventories 151,558 148,885 Regulatory Assets 8,946 9,962 Other Current Assets 25,842 30,579 Total Current Assets 674,410 630,041 Noncurrent Assets Investments 128,289 121,177 Property, Plant and Equipment, net of accumulated depreciation 2,754,068 2,692,460 Regulatory Assets 99,010 98,673 Intangible Assets, net of accumulated amortization 5,192 5,743 Goodwill 37,572 37,572 Other Noncurrent Assets 66,747 66,416 Total Noncurrent Assets 3,090,878 3,022,041 Total Assets $ 3,765,288 $ 3,652,082 Liabilities and Shareholders' Equity Current Liabilities Short-Term Debt $ — $ 69,615 Accounts Payable 98,234 113,574 Accrued Salaries and Wages 25,039 34,398 Accrued Taxes 16,465 17,314 Regulatory Liabilities 24,580 29,307 Other Current Liabilities 39,162 45,582 Total Current Liabilities 203,480 309,790 Noncurrent Liabilities and Deferred Credits Pension Benefit Liability 32,204 32,614 Other Postretirement Benefits Liability 26,494 27,385 Regulatory Liabilities 289,546 288,928 Deferred Income Taxes 278,091 267,745 Deferred Tax Credits 14,705 14,990 Other Noncurrent Liabilities 102,932 98,397 Total Noncurrent Liabilities and Deferred Credits 743,972 730,059 Commitments and Contingencies Capitalization Long-Term Debt 1,043,374 943,734 Shareholders' Equity Common Shares 209,522 209,140 Additional Paid-In Capital 432,664 429,089 Retained Earnings 1,131,542 1,029,738 Accumulated Other Comprehensive Income 734 532 Total Shareholders' Equity 1,774,462 1,668,499 Total Capitalization 2,817,836 2,612,233 Total Liabilities and Shareholders' Equity $ 3,765,288 $ 3,652,082 Expand OTTER TAIL CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) Six Months Ended June 30, (in thousands) 2025 2024 Operating Activities Net Income $ 145,827 $ 161,333 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation and Amortization 58,822 52,528 Deferred Tax Credits (285 ) (372 ) Deferred Income Taxes 6,149 9,492 Investment Gains (2,741 ) (3,111 ) Stock Compensation Expense 7,396 6,824 Other, net (1,745 ) (1,251 ) Change in Operating Assets and Liabilities: Receivables (34,859 ) (34,803 ) Inventories (131 ) (11,551 ) Regulatory Assets (643 ) 7,361 Other Assets 4,756 (3,951 ) Accounts Payable (6,477 ) 41,239 Accrued and Other Liabilities (13,447 ) (19,312 ) Regulatory Liabilities 198 23,863 Pension and Other Postretirement Benefits (3,441 ) (4,828 ) Net Cash Provided by Operating Activities 159,379 223,461 Investing Activities Capital Expenditures (124,239 ) (175,528 ) Proceeds from Disposal of Noncurrent Assets 2,792 5,124 Purchases of Investments and Other Assets (5,579 ) (57,661 ) Net Cash Used in Investing Activities (127,026 ) (228,065 ) Financing Activities Net Repayments of Short-Term Debt (69,615 ) (68,612 ) Proceeds from Issuance of Long-Term Debt 100,000 120,000 Dividends Paid (44,023 ) (39,122 ) Payments for Shares Withheld for Employee Tax Obligations (3,134 ) (5,753 ) Other, net (2,991 ) (1,610 ) Net Cash (Used in) Provided by Financing Activities (19,763 ) 4,903 Net Change in Cash and Cash Equivalents 12,590 299 Cash and Cash Equivalents at Beginning of Period 294,651 230,373 Cash and Cash Equivalents at End of Period $ 307,241 $ 230,672 Expand OTTER TAIL CORPORATION Three Months Ended June 30, Six Months Ended June 30, Operating Revenues Electric $ 128,731 $ 112,828 $ 278,451 $ 254,317 Manufacturing 78,726 96,684 160,412 196,065 Plastics 125,586 132,824 231,533 239,022 Total Operating Revenues $ 333,043 $ 342,336 $ 670,396 $ 689,404 Operating Income (Loss) Electric $ 23,633 $ 22,597 $ 52,676 $ 51,639 Manufacturing 5,065 9,600 7,492 17,014 Plastics 72,034 82,089 130,909 145,392 Corporate (3,274 ) (3,375 ) (9,620 ) (8,159 ) Total Operating Income $ 97,458 $ 110,911 $ 181,457 $ 205,886 Net Income Electric $ 19,195 $ 18,485 $ 43,903 $ 40,956 Manufacturing 3,481 6,835 5,013 12,096 Plastics 53,104 60,612 96,543 107,350 Corporate 1,948 1,063 368 931 Total Net Income $ 77,728 $ 86,995 $ 145,827 $ 161,333 Expand
