Samsung Electro-Mechanics announced in a regulatory filing on June 30 that it has signed a major contract worth approximately 450 billion KRW (about $325 million USD) to supply multilayer ceramic capacitors (MLCCs) for artificial intelligence (AI) servers to a global Big Tech company. The one-year supply agreement is scheduled to run from January 1, 2027, to December 31, 2027.
MLCCs are critical electronic components that temporarily store electricity and deliver a stable current to semiconductors to ensure seamless operation. By filtering out electromagnetic interference (noise) within electronic devices, they significantly enhance both performance and hardware reliability.
AI servers require a massive surge in component density, demanding more than ten times the volume of MLCCs found in standard enterprise servers. Typically, a single graphics processing unit (GPU) requires over 20,000 MLCCs, and a fully loaded server rack can house up to 600,000 units. Because instantaneous power fluctuations within a server can directly cause performance degradation, the role of MLCCs in managing precise, ultra-stable power delivery has become paramount in high-performance AI computing environments.
Samsung Electro-Mechanics has been aggressively targeting the AI server market by leveraging its technological edge in ultra-small, high-capacitance, and high-reliability components. While the company commands around a 25% share of the overall global MLCC market, its footprint expands to over 40% in the highly demanding AI server segment, cementing its position as a dominant global leader in high-end component manufacturing.
According to the company, this contract represents an exceptionally rare, large-scale procurement order, driven by a widening supply deficit and surging enterprise demand for advanced AI server MLCCs. Building on this milestone, Samsung Electro-Mechanics is currently in multifaceted discussions with major global clients and leading Big Tech firms to expand its supply pipelines beyond 2027. The company plans to continuously pivot its portfolio toward high-margin products tailored for AI and automotive electronics.
“This contract is a definitive testament to our technical prowess, validating Samsung Electro-Mechanics' MLCCs as a foundational component of the AI era,” said Chang Duck-hyun, CEO of Samsung Electro-Mechanics. “We will continue to secure an early lead in the market by preemptively developing next-generation, cutting-edge products tailored to the evolving needs of our clients.”
