Samsung Electro-Mechanics lands record W1.7tr MLCC deal with global tech giant

Samsung Electro-Mechanics has signed its largest-ever long-term supply contract for multilayer ceramic capacitors (MLCC).

The company said Tuesday it secured a 1.07 trillion won ($781 million) order for AI server MLCCs from a major global firm. The supply agreement runs for one year, from January through December next year.

The deal brings to more than 10 the number of global companies with which Samsung Electro-Mechanics has signed long-term MLCC supply agreements. Additional contracts are expected, as the company is currently in talks with several other global firms.

MLCCs are key electronic components that regulate current flow in circuits and prevent signal interference between parts.

AI server MLCCs in particular must withstand high temperatures and high voltages around the clock, demanding greater capacity and reliability than standard products. The technical difficulty involved means only a handful of manufacturers can produce them.

Samsung Electro-Mechanics holds more than 40 percent of the global market share, splitting the AI server MLCC market with Japan's Murata. The company has earned recognition for its design capabilities, product reliability, and production and quality management capacity to meet demand from large global customers, driving a surge in orders.

Since May, Samsung Electro-Mechanics has signed a series of long-term supply contracts for silicon capacitors and AI server MLCCs totaling about 2.25 trillion won. Backed by stable demand, the company is also accelerating a portfolio shift toward higher-value products.

AI server MLCCs are installed in more than 10 times the quantity found in standard servers. Industry observers expect MLCC demand to grow rapidly alongside rising investment in AI data centers.

According to Goldman Sachs, the AI server MLCC market is projected to grow at an average annual rate of about 34 percent, from $1.4 billion in 2025 to $5.8 billion in 2030.

Despite this structural rise in demand, only Samsung Electro-Mechanics and Murata are realistically positioned to meet it, pushing the market in effect into a supply shortage. Lead times from order to delivery have lengthened, and MLCC prices have continued to rise as a result.

"This contract reflects global customers' recognition of Samsung Electro-Mechanics' technological capabilities and supply stability," a company official said. "We will expand the supply of high-reliability MLCCs for AI servers and establish firm leadership in the AI market."