AI NewsWaveSamsung Electro-Mechanics Wins 879.3 Billion Won AI Server MLCC Supply Deal, Its 8th This Year
Key points
- 879.3 billion won AI server MLCC supply contract
- Contract runs one year from Dec. 21
- Long-term deals this year total more than 5 trillion won
Samsung Electro-Mechanics said on the 30th that it signed a supply contract worth about 879.3 billion won for multilayer ceramic capacitors (MLCCs) for artificial intelligence servers with a major global company. TechM gave the exact amount as 879.28540 billion won. The contract runs one year, from Dec. 21 to Dec. 21, 2027. The reports identified the counterparty only as a major global company or a large customer.
Cumulative long-term supply contracts this year have exceeded 5 trillion won. IT Chosun reported that this is the eighth long-term supply contract this year, and Chosun Biz also said in its headline that it is the eighth long-term contract this year. The cumulative total was given as about 5.18 trillion won by iNews24, and as 5.2 trillion won in the headlines of Digital Daily and Bloter. Kukmin Ilbo and Chosun Biz reported that it is the second-largest of the long-term supply contracts disclosed this year.
Explanations of the demand behind the deal were similar. Digital Today explained that MLCCs are components that supply power stably to semiconductors, and iNews24 reported that the contract came as demand for high-value components for AI servers grows. Digital Daily noted that Samsung Electro-Mechanics is pursuing long-term supply contracts with about 50 customers and that more than half of its 2027 MLCC revenue is expected to come from long-term contracts.
In recent developments, Samsung Electro-Mechanics said on the 28th that it posted its largest-ever quarterly results, with third-quarter revenue of 3.7633 trillion won and operating profit of 691 billion won (Techworld News). On a conference call the same day, it said more than half of next year's AI MLCC revenue is expected to be secured through long-term supply contracts (Chosun Biz), and that supply shortages of FCBGA for AI servers continue and it is seeking price adjustments with customers. It plans to double fourth-quarter supply of ultra-large substrates for AI servers from the existing level. Nvidia also said on the 28th that, together with supply chain partners including Samsung Electro-Mechanics, it will expand its substrate production capacity for its products 2.5 times over the next three years and double its semiconductor testing capacity (IT Chosun). Earlier, on the 23rd, iNews24 reported that Nvidia had signed a long-term supply contract with Samsung Electro-Mechanics for AI chip package substrates.
Glossary An MLCC is a tiny component in electronic circuits that briefly stores electricity and releases it to stabilize current. FCBGA refers to a package substrate in which a semiconductor chip is flipped and attached directly to the substrate.