Samsung Electro-Mechanics has signed a supply contract worth approximately 879.3 billion won for multilayer ceramic capacitors (MLCC) intended for artificial intelligence (AI) servers. The demand for high-capacity and high-reliability components is increasing due to rising power consumption in AI servers, prompting the company to accelerate its revenue base through long-term supply agreements.
On October 30, Samsung Electro-Mechanics announced that this contract is one of eight long-term supply agreements disclosed this year, with the contract period running from December 21, 2026, to December 21, 2027. This is the second-largest MLCC long-term supply contract announced this year, bringing the cumulative total for major component contracts to approximately 5.18 trillion won.
The company is currently engaged in long-term supply agreements with over 50 clients. Based on these contracts, Samsung Electro-Mechanics expects to secure more than half of its MLCC sales for 2027 through long-term agreements. These contracts enhance supply stability by reflecting customer demand in advance and serve as a means to transition the business structure toward high-value products.
The market for MLCCs used in AI servers is expanding alongside improvements in semiconductor performance. As the computational power of graphics processing units (GPUs) and application-specific integrated circuits (ASICs) increases, the importance of components that can reliably control voltage fluctuations is also growing. Samsung Electro-Mechanics anticipates that the demand for MLCCs for AI servers will double each year.
MLCCs for AI servers must not only be high-capacity and miniaturized but also operate reliably in high-temperature and high-voltage environments. Due to high technical barriers to entry, the number of suppliers is limited. Samsung Electro-Mechanics has reported that it holds over 40% market share in this sector. Although the specific scale of the contract with the client has not been disclosed, this agreement is expected to increase the company's share of high-value components for AI servers.
Goldman Sachs projects that the market for MLCCs used in AI servers will grow from $1.4 billion in 2025 to $5.8 billion by 2030, reflecting an average annual growth rate of about 34%. As the market expands, Samsung Electro-Mechanics faces the challenge of translating long-term contracts into actual revenue and profitability while maintaining its capacity to supply high-spec products.
* This article has been translated by AI.
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