Samsung Electro-Mechanics Sees AI Server MLCC Demand Rising Eightfold in 2027

Samsung Electro-Mechanics said during its third-quarter earnings call on October 28, 2026, that demand for multilayer ceramic capacitors (MLCCs) used in AI servers is expected to rise to about eight times this year's level in 2027, up from its previous forecast of more than seven times. The company said the number of customers that have signed or are negotiating long-term supply agreements has reached about 50, compared with around 10 that had completed contracts in the second quarter.

The company attributed the rush for long-term deals to the capacitance requirements of AI servers doubling each year. MLCCs, which store and release electrical energy to semiconductors, are considered essential components in AI servers powered by high-performance chips. As major tech companies prepare to launch next-generation AI servers in 2027, demand for AI-related MLCCs continues to grow rapidly.

On pricing, average MLCC selling prices rose more than 10% quarter over quarter in the third quarter of 2026, following high-single-digit growth in the second quarter. Samsung Electro-Mechanics said the increase reflects a widening supply-demand gap and a higher share of high-value-added products in its sales mix.

To address supply constraints, the company plans to boost production capacity at its new Philippine plant, which will begin mass-producing advanced high-value MLCCs in 2027. It is also adding flip-chip ball grid array (FC-BGA) substrate lines in Sejong, Busan and Thai Nguyen, Vietnam, with production ramping in phases from 2027 and expected to make a significant revenue contribution from 2028. The company also plans to double shipments of FC-BGA substrates for server CPUs in the fourth quarter of 2026.

Management said supply tightness will persist because customer demand is growing faster than expected and capacity expansion takes time. The company is currently evaluating the timing and scale of further investment.