Cold therapy is used to reduce blood flow- vasoconstrict, therefore, is useful for reducing heat and swelling in an area this is often the case in acute injuries or post-surgery. Laser is also useful in these cases to increase the healing rate of wounds.
Reducing swelling also reduces pressure on the nociceptors which in turn reduces pain. In this way, it is similar to how PEMF works.
Cold therapy also reduces pain via the pain gate theory in which the ‘gate’ or threshold for pain perception is overwhelmed by cold signals preventing the pain signals being perceived.