Samsung Electro-Mechanics' profit is forecast up 124% as its AI chief warns China has 10 rivals to its one
Samsung Electro-Mechanics builds the capacitors and substrates inside Big Tech's AI servers, and its 2026 operating profit is forecast to more than double. Its first chief AI officer says the only answer to Chinese rivals that outnumber his field more than ten to one is an internal army of AI agents.
Vincent Jiang · 3 min read
The chief AI officer opened with the threat
Jang Woo-suk, executive vice president and the first chief AI officer of Samsung Electro-Mechanics (KRX: 009150), gave his first interview on October 13, 2026, at the company's Suwon plant and named the problem his new job exists to solve 12. He calls it the "red sandwich crisis": Chinese rivals closing on technology and price at once 1.
"There are more than 10 times as many companies in the same business in China," Jang said. "That means we cannot hold off the pursuit by developing technology at the same pace they do" 1. The same day, 200 employees opened a four-day hackathon at headquarters to build the AI agents he is betting on 12.
The boom being defended is the company's biggest
Samsung Electro-Mechanics makes the multilayer ceramic capacitors (MLCCs) and flip-chip ball grid array (FC-BGA) substrates used in Big Tech's AI chips 1. Data provider FnGuide forecasts 2026 revenue of 14.43 trillion won ($10.1 billion) and operating profit of 2.05 trillion won ($1.4 billion), up 28% and 124% 1. The stock gained more than 400% in 2026 through late September 3.
Operating profit is forecast to more than double in 2026 and keep climbing
- Estimate
Data
| Value | |
|---|---|
| 2025 (estimate) | ₩0.91T |
| 2026 forecast (estimate) | ₩2.05T |
| 2027 forecast (estimate) | ₩3.01T |
Big Tech's prepaid buying has reached the component layer
The multi-year prepaid buying that Nvidia−2.97% — Nvidia, down 2.97 percent today, Google and Microsoft−1.36% — Microsoft, down 1.36 percent today brought to memory now covers components. Samsung Electronics−7.39% — Samsung Electronics, down 7.39 percent today, the memory-chip maker and a separate company from Samsung Electro-Mechanics, has locked 75% to 80% of next year's planned memory output in long-term deals 56, on five-year contracts with 20% to 25% cash prepayments and clauses that bind buyers even if they cancel 5.
Samsung Electro-Mechanics has signed MLCC supply agreements worth 3.32 trillion won since May 2026 with about 10 global companies 7, and is finalizing a 700 billion won ($507 million) deal to supply MLCCs to Delta Electronics 5, a Taiwan-based maker of power supplies and cooling systems for AI data centers 8. Signing it would push the order book past 4 trillion won 7.
Its board answered on September 28, 2026, with 6.78 trillion won ($4.99 billion) of new FC-BGA lines in Sejong and Vietnam, a commitment reported at up to 7 trillion won ($5.2 billion) and backed by mid- to long-term supply commitments from unnamed Big Tech customers that will provide part of the capital 39. Mass production begins only in September 2028 3.
One hundred AI projects against ten times the rivals
Jang's defense is mandatory and internal: every team carries an assigned AI-agent project, more than 100 of them under way, built on SEMCo-Work, a model the company runs on its own servers 12. Through October 16, 200 employees compete for 33 million won ($23,000) in prizes to build agents that cut repetitive work 12.
His warning cuts inward as well. "More than 10 sites are being expanded and we are growing in scale, but in some areas we are also stagnating," he told employees, urging substance alongside size 2.
Queues and a Japanese film keep rivals out, for now
Qualifying a new substrate supplier takes 12 to 24 months 3, and Japan's Ajinomoto, better known for food seasonings, supplies about 95% of the Ajinomoto Build-up Film (ABF) insulation inside every FC-BGA substrate 3. Ibiden and Shinko, also Japanese, hold about 70% of the FC-BGA market; in AI-server capacitors Samsung Electro-Mechanics shares a duopoly with Japan's Murata 4. Chinese numbers do not clear those queues quickly.
Jang's point about pace still stands, and Choi Woo-young, a professor at Seoul National University, names the risk on the other side: suppliers locked into five-year deals face defaults or forced renegotiation if the AI boom slows 5.
October 28 is the first reading
Provisional third-quarter results land on October 28, 2026, figures the company flags as provisional and subject to revision in audit 10. The first test is operating profit against the 2.05 trillion won forecast 1; behind it come the Delta Electronics MLCC signing and the hackathon's winning agents 157.
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
