Samsung Electro-Mechanics shares set a new all-time high for a second straight day. Samsung Electro-Mechanics closed at 2.2 million won on the 18th, up 8.27% from the previous trading day, and the rally continued on the 19th, rising intraday to as high as 2.417 million won.
Compared with early this year, the share price is up about 760%. Demand for artificial intelligence (AI) servers is turning not only high-bandwidth memory (HBM) but also flip-chip ball grid array (FC-BGA), a semiconductor substrate, and multilayer ceramic capacitors (MLCC) into bottleneck components, which is cited as the driver pushing up the stock.
However, analysts say that for Samsung Electro-Mechanics' share gains to continue, the market must look not only at its own competitiveness but also at external variables. That is because the pricing and capacity expansion strategy of Japan's Murata Manufacturing (Murata), the No. 1 global MLCC company, could affect Samsung Electro-Mechanics' average selling price, long-term supply agreements (LTA), and market share defense strategy.
◇ Target price of 3 million won appears… the premise is "price hikes"
As the AI market expands, demand is rising in tandem for MLCCs and semiconductor substrates, Samsung Electro-Mechanics' key items. KB Securities on the 19th raised its target price for Samsung Electro-Mechanics by 36% to 3 million won from 2.2 million won. The change reflects the view that MLCCs and packaging substrates have entered a super-boom and that shortages could persist for at least two years.
According to FnGuide, the consensus for Samsung Electro-Mechanics' third-quarter consolidation results this year is 3.457 trillion won in revenue and 470 billion won in operating profit. That implies increases of 19.7% in revenue and 80.6% in operating profit from a year earlier. The consensus for full-year operating profit is 1.5895 trillion won, and securities firms commonly analyze that it could rise 74.0% from the prior year.
However, these numbers can materialize only if several assumptions are met. ▲ A shortage of MLCCs for AI servers must actually lead to price hikes, ▲ customers must lock in volumes in advance through LTAs, and ▲ Samsung Electro-Mechanics must avoid losing share to Murata while increasing the portion of high value-added products.
Conversely, if Murata quickly adjusts its pricing and expansion strategy, if customers resist price hikes, or if Samsung Electro-Mechanics mis-sequences price hikes and expansions, the earnings outlook could also change.
◇ Crowded MLCC market with many rivals… big variables also for AI server products
The demand surge and shortages driven by AI expansion are appearing in FC-BGA and MLCCs following memory semiconductors.
Still, it is necessary to look more closely at how long the factors behind Samsung Electro-Mechanics' share-price rise will last and how they will actually translate into earnings gains. While HBM and other DRAM are in a structure effectively dominated by Samsung Electronics, SK hynix, and Micron, there are more players in MLCCs.
According to market research firm DataIntello, the 2025 global MLCC market share by revenue is estimated at Murata 28%–30%, Samsung Electro-Mechanics 22%–24%, TDK 11%–13%, Taiyo Yuden 8%–10%, and Yageo 7%–9%.
In the securities industry, Murata (45%) and Samsung Electro-Mechanics (40%) are estimated to effectively split the market for high-spec MLCCs used in AI servers. The two companies thus hold the leadership in AI server MLCCs. However, the more the two focus production on high-spec products, the more room there may be for other companies to seize opportunities in commoditized products. Samsung Electro-Mechanics is not in a structure where it can focus production only on AI server products with high profitability.
◇ Samsung Electro-Mechanics can raise prices only if Murata moves first
Samsung Electro-Mechanics raised prices preemptively during the MLCC boom in 2017–2018. As a result, it ceded some customers to other corporations, suffered a drop in market share, and took three to five years just to recover. Analysts say that in this boom Murata is likely to move first, and after customer reactions are confirmed, Samsung Electro-Mechanics will respond.
In effect, Samsung Electro-Mechanics' earnings growth magnitude will be determined by Murata's strategy. According to the industry and the securities community, Murata recently notified customers of MLCC price hikes of 15%–35%. In its earnings release at the end of Apr., Murata also guided that in fiscal year 2026, server-related capacitor sales would increase 85%–90% from the previous year and the average selling price (ASP) for capacitors overall would rise 5%–10%.
iM Securities said that if MLCC prices rise 10%, Samsung Electro-Mechanics' operating profit in 2027 could expand to around 2.5 trillion won. If prices rise 20%, operating profit could increase to as much as 3.1 trillion won. Conversely, if price hikes meet customer resistance or Samsung Electro-Mechanics loses some volume, earnings estimates could fall.
◇ Shares rising without capacity additions… could become a risk the moment plans are announced
An MLCC shortage is already evident. Market research firm TrendForce analyzed that the lead time for some high-capacity X6S MLCCs has lengthened from the previous eight weeks to as long as 20 weeks. That means it could take about five months from order to delivery.
The current rise in MLCC-related stocks is also due to expectations of price hikes stemming from insufficient capacity additions. Demand for high-spec MLCCs for AI servers is growing rapidly, but suppliers are not formalizing large-scale expansions in the short term. When demand is visible but supply growth is limited, prices rise and expectations build for margin improvement.
Murata is increasing investment in capacitors to meet data center demand. To capture expanding data center demand, it has also identified small, high-capacity capacitors and power modules as key growth tasks. However, it will take time for the effects of expansion to translate into actual increases in high-spec MLCC supply. That is because MLCCs for AI servers have longer manufacturing lead times and are harder to secure Production yield than general MLCCs.
Samsung Electro-Mechanics also has a need to expand capacity. In its first-quarter earnings release this year, Samsung Electro-Mechanics said AI-related demand is growing faster than previously expected, so investment could more than double from a year earlier, and investment over the next three years could be much larger than in the past. iM Securities estimated Samsung Electro-Mechanics' capital expenditures this year at more than 1.8 trillion won. However, large-scale official announcements remain limited regarding the start timing of new AI server MLCC lines, which the market watches most closely, or the specific scale of production capacity expansion.
An industry official said, "While shortages persist, Samsung Electro-Mechanics and Murata can hold the upper hand as suppliers," but added, "The moment a large-scale expansion plan is formalized, the market will bring forward the point at which it prices in the end of the shortage."
If Samsung Electro-Mechanics formalizes expansion quickly, it could cut its own bottleneck premium. Conversely, if expansion is delayed, it could lose customer volumes to Murata. The industry sees a high likelihood that Samsung Electro-Mechanics will adjust its MLCC supply strategy while watching Murata's investment pace, the intensity of its price hikes, and customer LTA demands.
◇ AI servers and in-house ASICs proliferate… MLCC demand "surges"
Despite various variables, it is clear that MLCC demand is exploding. MLCCs store electricity and supply it stably to various electronic devices while reducing voltage fluctuations and noise. They are used in most electronic devices, including smartphones, PCs, and automobiles, and are also called the "rice of the electronics industry."
MLCCs are essential for AI semiconductors that use electricity, such as central processing units (CPU), graphics processing units (GPU), and application-specific integrated circuits (ASIC). AI servers consume far more power than general servers, and momentary power fluctuations are much larger around GPUs or ASICs. If power supply wavers, AI chip performance can drop or errors can occur. That is why MLCCs that are smaller, hold more electricity, and withstand higher temperatures in a tight space are needed.
MLCCs for AI servers are more technically demanding than mobile and IT products, but they are also more expensive and are a flagship product for ensuring profitability. While a smartphone circuit board carries about 800–1,200 MLCCs, an AI server reportedly carries around 20,000–30,000. As AI chip performance rises, even more MLCCs are required. Nvidia's next-generation AI server platform, the Vera Rubin series NVL72 server, is estimated to carry about 600,000 MLCCs, more than 30% higher than the existing Blackwell series GB300.
Another pillar recently spurring MLCC demand is the expansion of in-house ASICs by cloud service providers (CSP). Big Tech corporations such as Google, Amazon Web Services (AWS), Meta, and Microsoft (MS) are focusing on developing their own AI accelerators to reduce dependence on Nvidia GPUs and lift revenue.
As CSPs increase their in-house ASICs, MLCC demand naturally grows as well. ASICs, like GPUs, use a lot of power and require precise control of power fluctuations. TrendForce analyzed that the spread of in-house ASICs by global CSPs is concentrating demand for high-spec MLCCs on certain premium specifications. Demand is converging on high value-added products such as 47µF 2.5V X6S 0402 and the 100µF X6S series.
Increases in MLCC usage are also being confirmed in next-generation AI accelerator platforms. On the AMD MI450 platform, usage of 47µF 2.5V X6S 0402 MLCCs increased from 1,440 per board to 10,544 during validation, a 632% jump. On Nvidia's Vera Rubin platform, usage of 100µF 4V X6S 0805 MLCCs reportedly rose from 320 to 500 per board.
In the second half of this year, major in-house ASIC platforms such as Google TPU V8t/i, AWS Trainium 4, and Meta MTIA 400 and 450 are expected to ramp up mass production. Once these products enter full-scale production expansion, MLCC demand could rise to a new peak.
◇ Samsung Electro-Mechanics' differentiation cards are MLCCs, FC-BGA, and silicon capacitors
Murata has strengths in ceramic materials, powders, thin-film lamination, and miniaturization technologies. It has MLCCs and other passive components, communications modules, high-frequency components, and power modules. A strength is that it can propose not just MLCCs but the entire suite of power-stabilizing components to AI data center customers.
By contrast, Samsung Electro-Mechanics has expanded its presence in AI server MLCCs by responding to demand for high-capacity products and server and automotive customers. In addition, it has FC-BGA, a package substrate for AI Semiconductor, and silicon capacitors, allowing it to offer a comprehensive AI semiconductor power-stabilization solution, which is cited as a differentiator.
NH Investment & Securities analyzed that, unlike other MLCC makers, Samsung Electro-Mechanics has a packaging division, and its differentiated competitiveness leveraging synergies could stand out. The point is that it can propose a power-stabilization solution that considers both substrates and MLCCs, rather than supplying only MLCCs. Samsung Electro-Mechanics recently signed a 1.5 trillion won supply contract for silicon capacitors, components mounted inside high-performance semiconductor packages such as AI server GPUs and HBM to boost power-supply stability.
A researcher at a market research firm said, "Murata has formalized demand for data center capacitors and an ASP rise, and how much Samsung Electro-Mechanics can capture in prices and volumes within that trend will be the factor that determines the stock going forward."