Samsung Electro-Mechanics is on the verge of surpassing 4 trillion won in long-term supply contracts for multilayer ceramic capacitors (MLCCs) related to artificial intelligence (AI). Analysts suggest that the benefits of AI infrastructure, previously concentrated in graphics processing units (GPUs) and high-bandwidth memory (HBM), are now extending to passive components that control power and signals.
According to industry sources, Samsung Electro-Mechanics is in discussions with global power and electronic component companies for a long-term supply contract (LTA) worth around 700 billion won for MLCCs used in AI servers. If successful, this contract would push the total value of long-term agreements secured since May for silicon capacitors and AI server MLCCs beyond 4 trillion won.
Earlier this month, Samsung Electro-Mechanics signed a supply contract for AI server MLCCs worth 1.072 trillion won with a major global corporation, marking the largest contract in the company's history for MLCCs. The company is reportedly engaged in long-term contracts with over ten global tech giants and semiconductor firms, with additional agreements under negotiation.
MLCCs play a crucial role in stabilizing current in electronic circuits and reducing signal interference between components. Although they are smaller than a grain of rice, high-performance AI servers require a significantly higher number of MLCCs to ensure stable power supply. AI server products reportedly contain more than ten times the MLCCs compared to standard servers, with prices exceeding three times that of mobile applications. The industry notes that only a handful of manufacturers can produce MLCCs capable of withstanding high temperatures and voltages 24/7.
The competitive performance of AI chips is also driving demand. According to market research firm TrendForce, the number of specific high-capacity MLCCs used in next-generation AI server boards is expected to surge by 632%, from 1,440 to 10,544 units. Some MLCCs used in NVIDIA's next-generation 'Vera Rubin' platform have increased from 320 to 500 units per board. The expansion of proprietary AI chips by major tech companies like Google and AWS is also supporting this demand.
Samsung Electro-Mechanics is shifting its production capacity towards AI. In July, the company announced plans to invest approximately 15 trillion won by 2040 to develop its Busan facility into a key production and R&D hub for high-value MLCCs and high-performance package substrates for AI data centers. The industry estimates that Samsung Electro-Mechanics holds over 40% market share in the AI server MLCC sector.
Go Ui-young, a researcher at iM Securities, stated that as Samsung Electro-Mechanics secures large long-term contracts, it is strengthening its supply leadership in the high-value MLCC market for servers and AI. The expansion of AI investments is driving up demand and prices for key components within servers, leading to a rapid restructuring of Samsung Electro-Mechanics' business focus from smartphones to AI and data centers.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.