Murata, the world's No. 1 company in MLCC (multilayer ceramic capacitors), is discontinuing some of its existing products and restructuring its production lines. This move is seen as a strategy to concentrate production capacity on high-value products amid a sharp surge in demand for MLCCs used in AI servers. With strong demand confirmed for high-value MLCCs and price increases anticipated, Samsung Electro-Mechanics is expected to benefit significantly.
According to industry sources on the 13th, Murata recently notified customers of plans to discontinue certain specifications among nine MLCC series. The final order deadline is set for late March 2028, and the final shipment date is scheduled for late March 2029.
The products targeted for discontinuation include not only general-purpose items used in consumer electronics and industrial equipment but also some automotive-grade products. Murata explained to customers: "We are reevaluating our MLCC product lines to stabilize supply and improve support systems," adding, "We plan to discontinue production of these products to expand capacity for other products."
Industry observers view this move as a portfolio restructuring aimed at concentrating production capacity on high-value MLCCs with rapidly growing demand, such as those for AI servers. In particular, high-specification MLCCs for servers require more production resources than general-purpose products.
Depending on product specifications, producing one server-grade MLCC may require the same production capacity needed to make three general-purpose MLCCs. As production of high-specification products increases, the capacity available for general-purpose products declines even faster.
This trend closely mirrors recent changes in the memory semiconductor market. Memory companies such as Samsung Electronics and SK Hynix prioritized allocating their limited wafer production capacity to HBM (high-bandwidth memory) after demand for AI-related HBM exploded. The expansion of HBM production constrained general-purpose DRAM supply, leading to a price increase across the entire DRAM market.
In the MLCC market as well, as leading companies like Murata and Samsung Electro-Mechanics expand production of MLCCs for AI servers, the production capacity available for general-purpose products decreases. The supply shortage that began with AI-related products is spreading to general-purpose items, pushing up prices across the entire MLCC market.
In fact, signs of supply shortages in the MLCC market have become increasingly clear. According to UBS eVidence Lab, as of last month's 9th, global MLCC distributors' inventory levels dropped by 8% compared to four weeks prior, falling to a record low. Meanwhile, during the same period, the MLCC distribution price index rose by 7%.
Increased demand for high-value products and rising prices for general-purpose products are both positive for Samsung Electro-Mechanics. Murata's product discontinuation and production capacity reallocation are interpreted as signals of strong demand for high-value MLCCs. Industry forecasts also suggest that Samsung Electro-Mechanics will raise prices for both general-purpose MLCCs and high-specification products used in AI servers in the fourth quarter of this year.
Orders for MLCCs for AI servers are also increasing rapidly. Recently, Samsung Electro-Mechanics signed a contract to supply AI server-grade MLCCs worth 1.722 trillion won over the course of 2027 to global big tech (large IT) companies.
Since May, long-term supply contracts related to silicon capacitors and AI server-grade MLCCs have totaled 3.32 trillion won. Samsung Electro-Mechanics maintains its position as a global leader in the AI server MLCC market with over 40% market share.
In particular, AI servers are equipped with more than ten times the number of MLCCs compared to general-purpose servers. Market research firm Mordor Intelligence forecasts that the global MLCC market size will grow more than twofold from $31.87 billion this year to $64.19 billion in 2031.
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