Seoul: Samsung Electro-Mechanics Co. announced on Tuesday that it has secured a substantial contract valued at 454 billion won (US$293 million) to provide multilayer ceramic capacitors (MLCCs) for artificial intelligence (AI) servers to a customer based in the United States. The contract is set to span from January 2027 to December 2027.

According to Yonhap News Agency, Samsung Electro-Mechanics, a key division of Samsung Electronics Co., has opted not to publicly identify the client due to a confidentiality agreement. However, industry experts speculate that the customer could be one of the leading U.S. cloud service providers (CSPs).

The demand for AI server MLCCs is witnessing a significant surge as major CSPs, such as Amazon Web Services, Google, and Meta, ramp up their investments in AI-driven data centers. MLCCs are essential electronic components that manage and stabilize electrical currents within circuits. These capacitors are utilized extensively in various devices, including smartphones, personal computers, automotive electronics, and AI servers.

MLCCs specifically designed for AI servers necessitate more sophisticated manufacturing processes compared to those used in mobile devices. Industry analysts highlight that contracts of this magnitude are uncommon in the MLCC market, indicating a tightening supply and a robust demand for components tailored for AI servers.