Samsung Electro-Mechanics Announces 879.3 Billion Won AI Server Contract
Key Facts
Samsung Electro-Mechanics announced a 879.3 billion won supply contract for multilayer ceramic capacitors for AI servers, Aju Press reported on October 30, 2026. The company signed the agreement with a major global company whose name was not disclosed, according to the report. Performance begins on December 21, 2026, and ends on December 21, 2027. The report described the deal as the company’s second-largest long-term MLCC contract announced this year and its eighth disclosed long-term supply contract overall during the year. The deal adds to supply commitments tied to data center components, as the company’s results reflect expanding demand for these applications.
The cumulative value of announced key component contracts reached about 5.18 trillion won from May through October 30, according to Chosun Biz. These contracts include silicon capacitors and MLCCs for servers, inductors and FCBGA substrates, so the figure goes beyond the new deal alone. The size of the announced portfolio offers a picture of the breadth of the company’s business in hardware components linked to data centers. The value of the new MLCC contract is tied to its one-year supply period, while the total combines contracts for multiple products. The name of the customer receiving the capacitors under the new agreement was not disclosed.
The company’s third-quarter results showed simultaneous growth in revenue and operating profit, with revenue up 9% and operating profit up 57% compared with the second quarter, according to its earnings statement. The Component Solutions division recorded revenue of 1.883 trillion won, up 36% year over year and 14% quarter over quarter. The company attributed the division’s growth to higher sales of applications used in AI data centers, including servers, networking and power. This performance places the new capacitor contract within a broader expansion in component sales, rather than making it the sole indicator of the company’s activity. The earnings statement also links the increase in required capacitor capacity to the development of GPUs used in AI servers.
The company says the MLCC capacity required for each GPU in an AI server doubles annually, according to its third-quarter earnings statement. This outlook concerns the amount of capacitors required per GPU and does not mean total market demand is doubling at the same rate. Separately, Aju Press linked the growing need for capacitors to the high power consumption of AI servers. Chosun Biz says Samsung Electro-Mechanics holds more than 40% of the market for these capacitors designed for servers. Goldman Sachs estimates that the market will rise in value from 1.4 billion dollars in 2025 to 5.8 billion dollars in 2030, at an average annual growth rate of about 34%.
The company is seeking to secure a portion of its future revenue through long-term supply agreements. Chosun Biz reported that it has signed or is negotiating agreements with about 50 companies, meaning the figure includes parties at different stages and does not represent customers who have all already signed contracts. The company expects these agreements to cover more than half of MLCC revenue in 2027. In its second-quarter results published on July 30, it said it had signed long-term MLCC supply agreements with more than 10 global customers. Figures published since then reflect an expansion in the scope of contracts and negotiations, while next year’s revenue outlook remains tied to the agreements’ execution.
Looking ahead, the company expects strong demand from AI data center customers for high-performance components to continue in the fourth quarter. It said it would respond to customer requests by expanding packaging substrate supplies and providing new FCBGA products for CPU servers and AI accelerators. These plans include components beyond MLCCs as part of its response to data center demand. This places the supply contract running through December 2027 within a broader growth trajectory for the component business. The cumulative value of announced contracts and the outlook for MLCC revenue in 2027 remain separate indicators of the scale of announced business and what the company expects from its agreements.