Samsung Electro-Mechanics Co. is accelerating its pivot away from consumer electronics toward artificial intelligence infrastructure and electric vehicles, reducing its vulnerability to the volatile smartphone market that once dominated its revenue.
The South Korean component maker has cut the share of IT-related products in its multilayer ceramic capacitor business to 53% this year from 83% in 2018, according to analysis from iM Securities. That ratio is expected to fall to 44% by 2027 as industrial, automotive, and server applications take over.
The shift is already paying dividends. Samsung Electro-Mechanics’ global MLCC market share climbed to 24% in the third quarter from 21% in 2023, with the segment now contributing roughly 70% of operating profit versus 55% two years earlier. Average selling prices have also edged higher.
Driving the momentum is explosive demand for AI server components. Japanese rival Murata Manufacturing recently raised its estimate for MLCC content per AI server baseboard to as many as 20,000 units from a previous range of 10,000 to 15,000, prompting analysts to revise the segment’s annual growth rate to 30%.
IBK Securities projects Samsung Electro-Mechanics will post revenue of ₩12.4 trillion ($8.4 billion) next year, up 10% from 2024, with operating profit climbing 33% to ₩1.2 trillion ($820 million).
